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Kodak and the Post Office
· Tuesday, January 10, 2012
The news that Eastman Kodak is preparing to file for bankruptcy, after being the leading photographic company in the world for more than a hundred years, truly marks the end of an era.
The skills required to use the cameras and chemicals required by the photography of the mid-19th century were far beyond those of most people -- until a man named George Eastman created a company called Kodak, which made cameras that ordinary people could use.
It was Kodak's humble and affordable box Brownie that put photography on the map for millions of people, who just wanted to take simple pictures of family, friends and places they visited.
As the complicated photographic plates used by 19th century photographers gave way to film, Kodak became the leading film maker of the 20th century. But sales of film declined for the first time in 2000, and sales of digital cameras surpassed the sales of film cameras just 3 years later. Just as Kodak's technology made older modes of photography obsolete more than a hundred years ago, so the new technology of the digital age has left Kodak behind.
Great names of companies in other fields have likewise vanished as new technology brought new rivals to the forefront, or else made the whole product obsolete, as happened with typewriters, slide rules and other products now remembered only by an older generation. That is what happens in a market economy and we all benefit from it as consumers.
Unfortunately, that is not what happens in government. The post office is a classic example. Post offices were once even more important than Eastman Kodak, and for a longer time, as the mail provided vital communications linking people and organizations across thousands of miles. But, today, technology has moved even further beyond the post office than it has beyond Eastman Kodak.
The difference is that, although the Postal Service is technically a private business, its income doesn't cover all its costs -- and taxpayers are on the hook for the difference.
Moreover, the government makes it illegal for anyone else to put anything into your mail box, even though you bought the mail box and it is your property. That means you don't have the option to have some other private company deliver your mail.
In India, when private companies like Federal Express and United Parcel Service were allowed to deliver mail, the amount of mail delivered by that country's post offices was cut in half between 2000 and 2005.
What should be the fate of the Postal Service in the United States? In a sense, no one really knows. Nor is there any reason why they should.
The real answer to the question whether the Postal Service is worth what it is costing can be found only when various indirect government subsidies stop and when the government stops forbidding others from carrying the mail -- if that ever happens.
If FedEx, UPS or someone else can carry the mail cheaper or better than the Postal Service, there is no reason why the public should not get the benefit of having their mail delivered cheaper or better.
Politics is the reason why no such test is likely any time soon. Various special interests currently benefit from the way the post office is run -- and especially by the way government backing keeps it afloat.
Junk mail, for example, does not have to cover all its costs. You might be happy to get less junk mail if it had to pay a postage rate that covered the full cost of delivering it. But people who send junk mail would lobby Congress to stay on the gravy train.
So would people who live in remote areas, where the cost of delivering all mail is higher. But if people who decide to live in remote areas don't pay the costs that their decision imposes on the Postal Service, electric utilities and others, why should other people be forced to pay those costs?
A society in which some people make decisions, and other people are forced to pay the costs created by those decisions, is a society where a lot of decisions can be made despite their costs being greater than their benefits.
That is why the post office should have to face competition in the market, instead of lobbying politicians for government help. We cannot preserve everything that was once useful.
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Jeremy
The government is only in it for the government.
Posted January 10, 2012 at 11:13:04 AM
Robert A. Hall
The Marines made Tom Sowell a photographer, and it has stayed with him for life. Kind of like how I shout at people. My DIs taught me that skill. Seriously, Sowell never-ending efforts to teach people to think beyond stage one and develop economic literacy, through his columns and books like “Basic Economics,” have rendered as great a service to this country as any Marine has given. People should be required to read “Basic Economics” and pass a short test on it to hold public office. Or to vote. The country would be in far better shape. I will link to this from my Old Jarhead blog.
Robert A. Hall
Author: The Coming Collapse of the American Republic
All royalties go to help wounded veterans
For a free PDF of my book, write tartanmarine(at)gmail.com
Posted January 10, 2012 at 11:25:33 AM
Howard Last
Good thing the govmint was not in the buggy whip business or we would be subsidizing it. With the govmint now subsidizing electric cars we may need buggy whips again.
AS for slide rules there is one benefit over calculators, you knew if the results were correct. With a slide rule you have to run the calculation in your head to know where to place the decimal point. With a calculator you can be off by an order of magnitude (for those who went to govmint skools that is ten times) or more. There is an additional benefit, they don't need batteries.
Posted January 10, 2012 at 12:23:50 PM
John Havener
"If FedEx, UPS or someone else can carry the mail cheaper or better than the Postal Service, there is no reason why the public should not get the benefit of having their mail delivered cheaper or better."
To begin with, the above quote from Mr. Sowell is a doozey. "IF?" Do you trash a whole institution based on a wild "if?" What if they can't? Are we then stuck with $4 stamps that get letters, packages, magazines, newspapers and the like, delivered on Tuesday, Thursday and alternate Saturdays? Do you trash a whole institution that was never intended to show a profit, because it 'costs' money to operate? The Congress took 4.5 billion dollars from the Postal Service in the '80s, and never gave it back.
To assume that everyone has access to, or the technological skills to operate the electronic means of communication is also a blunder of the highest degree. Should the Post Office disappear, millions of people in rural areas, or lower income urban areas, who do not have computers, or if they do, do not have high speed internet access, would be without means to conduct the communications of their daily lives.
There is a rank arrogance in one assuming that he knows what is best for all Americans. We already have enough of those kinds of persons in Washington...The Senate, the House and the Oval Office, to name a few.
Posted January 16, 2012 at 7:30:42 PM
John Havener
P.S. For a man to speak of removing any integral part of a society, without having a viable, tested, working replacement part is pure foolishness, no matter what his claim to fame...
Posted January 16, 2012 at 7:42:38 PM
Sherry
What I don't understand is why there is this continual talk about getting rid of the post office while we have the usurper in the White House lobbying to get the power to create a really big bureaucracy while he pretends to cut departments. What piddling few pennies we pay for postal service over what they bring in is nothing compared to the trillions spent on unauthorized wars, unauthorized social welfare, and unauthorized Presidential vacations, campaign busses, campaign parties, campaign golf excursions, campaign...
What are the chances that the crooks in congress and the White House would transfer the power of the post office to a private provider without lining their own coffers in the process? As long as we continue to elect crooks and shysters, we can't trust them to do anything with integrity.
Posted January 16, 2012 at 7:45:21 PM
Wumingren
Mr. Sowell said, "Moreover, the government makes it illegal for anyone else to put anything into your mail box, even though you bought the mail box and it is your property. That means you don't have the option to have some other private company deliver your mail."
Therein lies the answer! We all put up two mailboxes, one for the U.S. mail, and the other for "any other mail carrier." Then, we wait and see which box gets the fullest the fastest. Skrew the U.S. government monopoly on mail. We simply sidestep it.
I think I should buy some stock in mailbox manufacturing companies.
Posted January 17, 2012 at 12:15:15 AM
railfancwb
The post office is one of the few quasi-commercial endeavors the federal government is authorized to do by the Constitution, so naturally they want to get out of it in favor of the "war on drugs", department of education, and other unconstitutional ursupations of power.
Posted January 24, 2012 at 8:25:53 PM