Wouldn’t it be sweet if our post office poured billions into government coffers instead of sucking them out? Such an impossible dream is possible.
Last quarter the Postal Service lost over a billion dollars. When it loses money you pay for it. The government bails it out with your money.
This loss is not new. The service has lost billions over the years. It claims it made money the last four years. However, Congress lets it use accounting that would pass muster only with the Three Stooges. It lets it ignore billions in costs.
Now, the service is trying. It has cut its staff. It is offering early retirement to lots of high paid workers. Meanwhile, it has improved its on-time delivery record. It deserves a lot of credit.
But the fact remains that it loses bundles of your money.
Meanwhile, the headlines 15,000 miles away are about postal profits. New Zealand’s post office makes huge profits. It also pays taxes to government. And then it funnels its profits back to government as well.
It is a separate company that government owns. Set up in 1987. Government may not interfere with it. This allows the post office to shutter unprofitable offices. No powerful politician can force it to keep the Podunk Post Office open. It can hire and fire as it wishes. It can raise or lower postal rates whenever it wants. Without a congressional hearing.
It can – and has – opened thousands of kiosks within retail stores. This gives lots of small retailers more business and keeps them alive in tiny communities. It gives Kiwis more places to find postal services.
In other words, its management is allowed to operate the postal service as a business.
Before we look at its profits, we might look at its challenges. Because they are a carbon copy of ours. Yes, our service has to cover 3000 miles. But New Zealand’s has to cover 1000. It battles horrible weather, mountains, remote tiny locations. It needs to lug mail between two major and several small islands. And it does this for a mere 4 million people.
It is the size of Colorado with only one-third the postal customers. Yet it manages to offer over 1000 postal centers. And another 3000 retailers of stamps.
And New Zealanders are using snail mail less each year. Just like Americans. So the New Zealand Post has to adjust to this reality just as our post office does.
Its on-time delivery is equal to ours. Actually better. Its prices are 15 percent lower than ours. And its profits put our service to shame.
Since 2000 New Zealand Post has made over $287 million profit. After taxes! It has paid countless millions in taxes to the government. And countless more millions to the government as dividends - since government owns its stock.
Our population is about 76 times larger than New Zealand. So let us multiply this profit by 76. That comes to nearly $22 billion. In seven years! And they handle a first-class letter for 36 cents versus 42 cents here.
That tiny country runs a post office that has brought the equivalent of probably $12 billion into government coffers in the last 7 years. It retains some of its profits for expanding its business. And since the business grows in value, the government reaps a benefit. Its shareholding keeps growing more valuable. If it someday sells the shares to the public the profits for taxpayers will be staggering.
The U.S. should be ashamed. That is, the politicians should be. They will not look at making changes in how our system does business. They are prepared to let our service lose billions. When tiny New Zealand could teach them how to make billions from the mail.
From Tom ... as in Morgan.
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