Wal-Mart is the largest civilian employer. Guess who’s number two? The post office. The USPS employs 600,000. My friend Chris Edwards at Cato explains:
For more than a century, the federal government has pursued a misguided witch hunt against perceived monopolies in the private sector. But in a glaring hypocrisy, Congress has long protected one of the nation’s largest businesses against competition. The legal monopoly conferred on the U.S. Postal Service (USPS) is a relic. Government-run mail makes no sense in our email-dominated economy, and other nations are showing that postal privatization works. If the centuries-old Royal Mail can be privatized, then so can our USPS.
In a new study, former Clinton administration economist Robert Shapiro provides useful input to the privatization debate. He looks at the subsidies that Congress confers on the USPS, as well as the extra costs.
Here are some background facts from Shapiro:
- With more than 600,000 workers, the USPS is the nation’s second largest civilian employer, after Wal-Mart.
- The USPS has three protected monopoly products: first-class mail, standard mail (bulk circulars, catalogs, etc.), and periodicals.
- Employee wages and benefits account for 78 percent of USPS costs. Average USPS worker compensation is at least 32 percent higher than comparable private-sector workers.
- Since the last time Congress supposedly fixed the USPS in 2006, the agency has been losing more than $4 billion a year.
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