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Comment by toomuchtodo | Hacker News Reader

Why reduce your margins for an adversarial customer who will squeeze you until they build their own distribution network with underpaid independent contractors? There is plenty of shipping volume for FedEx and UPS without Amazon deliveries. I would also be curious what happens when Amazon delivery contractors are reclassified as employees, since they only deliver for Amazon (Fedex lost a large legal [$240MM] dispute over this years ago [1]).

[1] https://www.reuters.com/article/us-fedex-settlement-idUSKCN0...

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During the holiday season, my rural post office will get multiple semi truck loads per day, just of Amazon packages to deliver. Don't discount the massive volume of deliveries from amazon.

That said, regular mail is also on the decline, significantly so, as more people use technology instead of pen and paper- bills, letters, contracts, nearly everything is going digital. Packages make up an increasingly significant amount of post office revenue.

That said, anyone who pays attention to Amazon at all knows that they show no remorse about screwing over business partners by entering the same market, and Amazon has been doing that for awhile now.

Even so, I suspect that they aren't going to bother expanding delivery out to where I am now- paying the post office to deliver is almost certainly cheaper than keeping a regular workforce of independent delivery drivers way out here.

> During the holiday season, my rural post office will get multiple semi truck loads per day, just of Amazon packages to deliver. Don't discount the massive volume of deliveries from amazon.

Except, when we do napkin math, it's costing USPS more money to deliver each of those packages than they collected! They would literally make money by not delivering packages.

They aren't making money off delivering your package, no - they lose money. If they were making money, they would not need billions of capitol injection routinely.

Aren't they forced to lose money by law, or something like that?

They're not losing money. They make money on package deliveries still, last I checked. The losing money thing is a republican/libtertarian talking point that is ignoring the law mandates them to prefund pensions by 75 years.

They could maybe get rid of a bunch of unproductive employees, keep the pension funding at the same level, and bring on new productive employees.

It's no secret getting a job at USPS is for life. That should not be a thing for a supposed public "service" organization that's expected to not bleed money everywhere.

And conversely this undue pension funding burden is a talking point as well. A lot of companies would be in a good financial position if only they didn't have to worry about their unfunded liabilities.

Can someone clarify for me if this USPS pension thing is any different from any other organization that offers pensions? Naively, the requirement to "fund" pension liabilities pretty reasonable. How else do you guarantee pensioners they'll have something when they retire. I know here in Chicago we're in bad shape because of unfunded pension liabilities.

I think they're being asked to fund pensions until the end of time, which regular companies aren't being asked to.

The USPS is the only company that needs to fund 75 years out. Do you know any that must also do that?

Yes, there is some point to be made about pensions and 401ks being raided, but now is not the time.

> Yes, there is some point to be made about pensions and 401ks being raided, but now is not the time.

When would the appropriate time be then?

The point of 75 year pension is to guarantee, in no uncertain terms, the existence of a retirement for the over 470,000 postal employees.

That is absolutely huge - particularly for an organization that's subject to the political whims of the day.

The only thing certain to happen 75 years from now is postal employees will be able to enjoy a rightfully earned retirement. Why would you want to deprive them of that?

I don't want to deprive them of that. Stop arguing in bad faith. The requirement stands out as extremely onerous and atypical. Look at most state pensions. Somehow, magically, most republicans only care about the USPS.

> Somehow, magically, most republicans only care about the USPS.

I could argue the opposite right now. Seems "the other side" only wants to champion USPS right now, even though only a year ago everyone would have been in near agreement USPS needs reforms. It's political... I get it, but does everyone here arguing get it too? Doubtful.

In my time serving as a legislative assistant for a California Assemblyman, we fought against several state controlled pension funds, including pushing for divestment from Iran. These attempts were always met with fierce opposition - "you're destroying my retirement!" and more. Anecdata I know...

Pensions, in my opinion, are universally bad. You, the individual, should control your own retirement. Too often these pensions, that people rely on, dry up or disappear suddenly due to gross mismanagement.

If you're going to have a pension - it should have to be funded for a massive amount of time. Maybe not 75 years, but the average person's working years (ie, 40 or 50 years). Making it impossible for the pension to be gone through no fault of your own is what we owe people stuck with pensions.

I'm continually stunned at how many people believe this obviously false fact. The USPS is not required to fund 75 years worth of pension payouts. They are required to set aside money to pay the pension liabilities they have incurred.

As the comment above got downvoted for pointing out the 75 year pension pre-funding requirement, the other framing is to even ASK the USPS to be profitable.

It's a common attack on public goods: Amtrak & USPS, but would never be asked of the Military or FEMA.

Neither the Military nor FEMA charge for services and also collect tax payer funds. How could either be "profitable"?

Amtrak and USPS both charge for services. It's reasonable to expect them to not hemorrhage billions of dollars annually as well.

Further, it can be argued a private business could operate on USPS or Amtrak scale with greater efficiency, cost much much less, and even turn a profit (see SpaceX).

1. SpaceX is not a community service.

2. SpaceX, one could argue, is being subsidized majorly by the US government, for strategic reasons. I'm pretty sure it would have gone bankrupt without government intervention.

3. Almost no passenger rail system is fully profitable, in the world. Just like education, it's something you still want because it's a community/public service.

USPS is not a community service either, in that regard. They charge for their services, so does SpaceX.

The assertion was a privately run company could do what USPS does a lot better, for less cost, and likely provide a better end result. SpaceX is an example of that, but there are many others.

> Neither the Military nor FEMA charge for services and also collect tax payer funds

Some parts of the military charge consumers, don’t they? For example, military Exchange stores charge for goods, but are also partly subsidized by direct appropriations - and the “profits” go back into military quality-of-life programs. You could decide instead to forgo this charge since as you say the military is not designed to turn a profit, but then you’d have to deal with all the perverse allocation problems and incentives that might pop up if everything in the store was suddenly “free”. Adding a cost to items helps to allocate limited supply (and helps to defray costs to the taxpayer of other military programs), even if the military as an overall organization is intended to direct taxpayer funds into achieving a purpose.

Now take that same idea and apply it to “providing government funded public transportation to make a city economically viable”, or “maintain a constitutionally mandated postal service”. Taking money for services is not incompatible with being fundamentally a government-funded service that expends more taxpayer funds than it brings in.

> They aren't making money off delivering your package, no - they lose money. If they were making money, they would not need billions of capitol injection routinely

This seems like a specious argument to me. I'm not intimately familiar with the napkin math, but I am also not convinced that they would ve profitable simply by not delivering Amazon's packages. Their costs continue to rise every year- new addresses, inflating gas, healthcare and pension expenses- while their primary revenue stream (posted mail) has been continually declining.

Add to that the fact that the USPS still has to go by every address every day, and so the last mile costs are relatively fixed; the only additional cost to them for delivering is the internal sorting and movement investments needed to handle the volume. Nobody actually knows the rates amazon and USPS have negotiated, but outside of Trump I have not seen many people argue that they are losing money on the deal- most seem to believe that it is a win-win scenario.

When FedEx walked away from Amazon, people said they were crazy.

Now, today, UPS has to bend-over-backwards to meet Amazon's demands for delivery days, pickup days, days worked, the price Amazon is willing to pay, etc.

Amazon was even able to compel USPS to delivery Amazon packages on Sundays!

Basically, UPS works for Amazon now - FedEx saw that coming, and saw Amazon buying up freighter aircraft and trucks, etc.

> Why reduce your margins for an adversarial customer who will squeeze you until they build their own distribution network with underpaid independent contractors?

Would you rather make $0 on 0 packages or "not $0" on lots of packages?

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