United States Postal Service

:This article describes the United States Postal Service. For the band named The Postal Service see The Postal Service.

Governance and organization

The USPS is headed by a Board of Governors appointed by the President and confirmed by the US Senate. The Board has a similar role to a corporate board of directors, setting policy and procedure and postal rates for services rendered. The United States Postmaster General, formerly appointed by the president and confirmed by the Senate, but now appointed by the board of governors, serves as Chief Operating Officer and oversees the day to day activities of the service.

Related Topics:
Board of Governors - President - US Senate - Board of directors - United States Postmaster General - Chief Operating Officer

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The USPS is often mistaken for a government-owned corporation (e.g. Amtrak), but is legally defined as an "independent establishment of the executive branch of the Government of the United States," as it is wholly owned by the government and controlled indirectly by the President. As a government agency, it has many special privileges, including a monopoly immune from antitrust law (see below), sovereign immunity, eminent domain powers, and powers to negotiate postal treaties with foreign nations.

Related Topics:
Corporation - Amtrak - Antitrust - Sovereign immunity - Eminent domain

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Although it is governmental in nature, the USPS has for the last few years insisted on using usps.com as its primary Internet address, with a .com top level domain implying that it is a commercial entity. The more-appropriate usps.gov address merely redirects to the .com version. However, some links on the website, like to the international rate calculator, link back to .gov, and the .com address does not work.

Related Topics:
Internet - .com - Top level domain - Commercial - .gov

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Monopoly status

The USPS enjoys a government monopoly with respect to first-class and third-class letter delivery under the authority of the Private Express Statutes. The USPS says that these statutes were enacted by Congress "to provide for an economically sound postal system that could afford to deliver letters between any two locations, however remote." In effect, those who mail letters to a near location are subsidizing those who are mailing letters to distant locations.

Related Topics:
Government monopoly - Private Express Statutes

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The USPS enjoys monopoly status in that it possesses the exclusive permission under federal law to deliver first and third class mail. However, an exception to private carriers is made with regard to "extremely urgent letters" as long as the private carrier charges at least $3 or twice the U.S. postage, whichever is greater (other stipulations, such as maximum delivery time, apply as well); or, alternatively, it may be delivered for free. The USPS also enjoys a monopoly privilege in placing mail into standardized mailboxes marked "U.S. Mail." Hence, private carriers must deliver packages directly to the recipient, leave them in the open near the recipient's front door, or place them in a special box dedicated solely to that carrier (a technique commonly used by small courier and messenger services).

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In the 1840s Lysander Spooner started the commercially successful American Letter Mail Company which competed with the United States Post Office by providing lower rates. He was successfully challenged with legal measures by the U.S. government and exhausted his resources trying to defend what he believed to be his right to compete.

Related Topics:
Lysander Spooner - American Letter Mail Company

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The 37 cents (USD) required by the USPS to deliver a letter in the U.S. compares favorably to other industrialized countries, such as those of the European Union, where the postage for an ordinary domestic first-class letter is nearly twice that much.

Related Topics:
USD - European Union

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Today, it is arguable whether any meaningful competition for ordinary letter delivery would develop in the absence of a monopoly, as letter volume continues to dwindle due to replacement by more efficient electronic means of communication and payment. In countries that have recently undergone postal service privatization, such as Germany, no meaningful competition for first-class letter delivery has materialized and the overall cost of services to consumers has risen. As it continues to lose package services market share to private competitors, the USPS and its organizational structure face an uncertain future.

Related Topics:
Postal service privatization - Germany

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As an affiliate of the federal government, the USPS is not required to pay any of the federal or state income taxes that regular businesses pay. Since the USPS is also directed by law to break even in the long run, there is currently not much tax revenue lost due to this tax exemption. However there is a possibility that a private alternatives to the USPS monopoly on normal letter delivery could be profitable and net tax contributors (Private competitors in package delivery have become profitable even with the tax burden placed on them). Therefore some critics view the current tax exemption as a subsidy provided by the government to the USPS.

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Subsidized services

The USPS claims to have operated "in a businesslike manner without taxpayer support" since its spinoff from the cabinet on July 1, 1971 following the passage of the Postal Reorganization Act of 1970. It does, however, receive compensation from taxpayer funds for certain services that it is mandated to provide for free or at a discount, including free mail for the blind, military mail, nonprofit mail and overseas ballots. $36 million such compensation was paid for fiscal 2004. In addition, Congress appropriated the USPS a total of $762 million for biohazard decontamination and detection equipment in response to the 2001 anthrax attacks.

Related Topics:
July 1 - 1971 - Postal Reorganization Act of 1970 - Military mail - Nonprofit mail - $ - Fiscal - 2004 - Biohazard - 2001 anthrax attacks

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