Re: Government competition

[stan johnson <sjohnson@gwi.net>]

** Reply to note from joemoore@cs.uky.edu Thu, 10 Dec 1998     
01:46:22 -0500   
      
 It has been suggested that governments should not be in direct   
 competition with private sector businesses. I was wondering how the   
 US Postal service fits in with this view, particularly with respect to   
 its agressive ads comparing its priority mail service with FedEx, and   
 UPS.   
      
 Should the government shut down the post office?   
      
 --Joe   
      
   
I must enter a *strong* objection to such draconian suggestions! To     
turn essential social services, such as the mails, the prisons, the     
police, and others, (I would add medical care) over to entities whose     
basic objective is to maximize their profit and minimize their costs,     
without primacy given to regard for the adequacy or completeness of     
their services, is and would be disastrous, in terms of services to the     
public. We have a government for a reason: to perform acts which are     
best done by an agency acting on behalf of the whole of society. The     
profit of an investor is *NOT* directly related to the benefit of the     
whole society. It *is* directly related to minimizing costs and     
maximizing income. Surely this need not be extensively discussed on a     
list devoted to appraising Microsoft!!   
   
Providing mail and parcel service to remote rural areas in a timely     
fashion is not a dollar-efficient operation. If UPS etc. didn't have the     
USPS as 'competition', I'm quite confident that service in rural areas     
would be drastically reduced. It would be the logical thing for a     
dollar-conscious manager to do--maximize parcels delivered per hour.    
And *all* private enterprise managers are inherently dollar-conscious. If    
not, they soon cease being private enterprise managers. Although the    
details are different, the same effect has been seen here in Maine in    
bus and airline service, with deregulation.  
  
And I reject out of hand any suggestion that 'this can all be regulated  
to assure our needs are met'. The actual fact, theory to the contrary  
notwithstanding, is that large corporate bodies are able to influence    
statutory and regulatory actions to their benefit. This is often contrary   
to society's benefit. Recall the recent appropriations for military   
contracting in Newt Gingrich's district--appropriations which even the   
Pentagon didn't want!! Examples could be adduced almost without   
limit, unfortunately.  
   
I've never seen [must admit I've never looked for] any rational     
exposition of this conventional-wisdom idea that 'the government     
shouldn't compete with private enterprise'. Why should I as a     
citizen be deprived of a service provided by my government just     
because some entrepreneur sees an opportunity to enrich him or     
herself? Does government exist first for the benefit of the citizens in     
general, or first for the benefit of entrepreneurs and investors?  
  
I've seen the follow-up post by Eric Bennett, citing 'audit' activities by    
the USPS. As is frequently done, one aspect of a problem is singled    
out in the cited post, and (without explicitly saying so) morphed into a    
proposal on a much broader front. The bottom line, IMO, is that    
carrying ordinary mail (as distinct from large parcels) is inherently    
inefficient, and would become very expensive if done for profit. Note    
that the offending mailings are described as (usually) large bundled    
deliveries. Not individual letters and bill payments. Once again,    
skimming the low-cost, high-profit parts of the service. Akin to the    
skimming of low-cost patient sectors by for-profit medical services, to    
the detriment of those most in need of those services.  
  
The USPS is already largely separated from the government: it is    
required to be [largely?] self-supporting, IIRC. I've already commented   
on the 'why not have private enterprise do it' idea. 


slj
-- 
Stan Johnson    TeamOS/2
sjohnson@gwi.net