And Now for a Postal Bailout
It’s another week in Washington, and it’s yet another bailout. This time, taxpayers will be tapped for another $41 billion to subsidize the healthcare retirement benefits of postal workers – benefits that are quite scarce in the private sector.
Democrats have a serious problem with creative destruction and advancements in technology. For self-described progressives, they are quite regressive when it comes to efficiency in markets and use of technology. They exhibit nostalgia for 14th century energy technology and 20th century banking technology. Hence, they don’t care too much for market progression. In concerted drives to hold back the tide of technology, they are quick to offer a helping hand to a dying industry. One such industry is the mail delivery.
It’s no secret that the United States Postal Service is on its way out. The transition to electronic communication, in conjunction with the success of private mail carriers, has dramatically reduced the demand for their service. Consequently, they no longer generate enough revenue to function as a self-sufficient entity, particularly when it comes to paying employee retirement benefits. In recent years, the USPS has patched the annual losses with borrowed money from the Treasury. However, it is now in such dire straits that it’s expected to hit the $15 billion borrowing cap later this year. It needs extra taxpayer cash to fill in the gaps.
If the USPS were a private entity, it would trim its workforce and operations to the amount of revenue they can produce until they are eventually forced to go out of business. That’s how creative destruction and supply and demand work in the real world. That is not how it works in Washington.