A Proposal for the US Postal Service

Since our inception as a country, the United States Postal Service (USPS) has been among the most recognized public service providers of the federal government.  By enabling communication and commerce between all parts of our nation, it has served to help build and strengthen our republic and build a shared American identity.

With the advent of email, and increasingly digitalization of communication and commerce, mail volume has decreased. Mail delivery service peaked in the mid-2000s at about 210 billion units delivered annually. Nevertheless, the USPS still handles an impressive amount of mail.  In fiscal year 2019, the Postal Service delivered 143 billion pieces of mail to 160 million delivery addresses.  This includes over 46 million rural addresses, where often, the USPS is the only delivery option.¹ This service generates significant revenue.  For example, between January 1 and March 31, 2020, the USPS reported total revenue of $17.8 billion.  For context, that single quarter revenue is more than the full year budget for the US Department of the Interior ($12.8 billion, 2021), which among other things operates the National Weather Service and National Parks System.  And on an annual basis, USPS revenue exceeds the budget of the the Department of Education ($66.6 billion, 2021) and is more than triple the budget of NASA ($69.9 billion, 2021).

Not exactly “chump change”!  Even a smaller USPS is still a significant business operation, and it is one that both serves and represents our country.  As such, it bears asking the question: Is the way the USPS carries out its function aligned with the values and needs of our country? When it comes to climate, the simple answer is the the USPS could do a lot more.

The majority of Americans see climate as a pressing issue.  Recent polls indicate that 50 percent of voters believe climate change poses a “critical threat” to the country’s vital interests in the next decade.  Another quarter rank climate as important.² According to a report from the non-partisan Pew Research Center, about 2/3 of Americans believe that the federal government should be doing more to address the issue.  And among a variety of policy proposals almost three-quarters (73%) support taxing corporations based on carbon emissions.³

Weather events confirm almost daily the need to address climate risk.  The 2021 heat wave in the Pacific Northwest has already claimed hundreds of lives, and direct and indirect economic costs are likely to range into the hundreds of millions of dollars.  “Once in a hundred year” events seem to be occurring every year. 

The situation is simple: extreme weather is extremely costly.

In its day-to-day operations, is the USPS aligned?  In some respects, the Postal Service has taken some modest positive steps.  For example, USPS recycles oil used in delivery jeeps.  It facilitates recycling by USPS customers.  It has implemented bicycle delivery routes and purchased some alternative fuel vehicles.  It has piloted some solar projects.  It has also established the USPS BlueEarth Product Carbon Accounting service.  The service provides large commercial customers a customized statement of carbon emissions associated with the customer’s mailings, which can help customers track progress toward carbon neutrality.

These actions are laudable, but in many respects, fall short of more ambitious goals.  As a large business operated by the US government on behalf of the American public, the USPS should be a leader on issues like sustainability and mitigating climate risk. The simple fact is that the USPS could and should be doing much more.

One very specific step that would have an outsize impact:  Introduce incentives through tiered postal rates for commercial business mail that uses carbon neutral, 100% recycled paper or wood paper alternatives and other environmentally sustainable products.  In other words, offer tiered postage rates that take account of the sustainability (or lack of it) in the materials being shipped.

The USPS can easily leverage the work of organizations that provide certification for such products.  Not only would companies respond to the economic signal, but as a US government business, the USPS would also set a new standard for other domestic and global mail and logistics companies.

As more companies use these “alternative” products, new supply chains will develop, and cost premiums for such products would diminish.  Driven by the business use case of large commercial mail clients, the availability of truly sustainable mail materials will increase for retail USPS clients – individuals, community organizations, and small businesses.

To facilitate the change, the new policy could be phased in with plenty of advance notice.  And at the start, it could apply to only the largest, commercial mail clients.  Over time, the sustainability-based postage rates could extend to additional companies.  In regard to enforcement, the USPS could rely on a simple system of company certification and recipient feedback.  Mail receiving a tiered shipping rate could be marked, perhaps with a colored leaf.  Getting mail that seems not to be in compliance with the leaf  mark?  A recipient could call the USPS, and if the mailer was found to be “cheating,” a fine could be issued.

Getting to carbon neutral is going to take vision and the capacity to imagine new, better ways of doing business.  Tiered sustainability-based postage rates represent a positive step forward.

Common sense?  Perhaps, but there can be an enormous chasm between what seems like embarrassingly easy policy and legislative action.  In fact, the idea of tiered postal rates is not new.  It was actually suggested a generation ago.⁴

The Postal Rate Commission undertook a feasibility study of implementing incentives to mailers who used recycled paper.  Members of Congress took some interest during oversight hearings. In its written response to questions put by members of the congressional oversight committee, the head of the Postal Rate Commission testified.

Question 4:  What is the status of your inquiry into the feasibility of creating a class of mail for mailers who utilize recycled paper?

Answer:  The Commission’s inquiry into the feasibility of rate incentives for mailers who use recycled paper was established as Docket No SS93-2 Recycled Mail Incentives and noticed in the December 29 1992 issue of the Federal Register [57 FR 61936].  The notice which also posed a series of questions for discussion invited comments from interested parties by May 1 1993.  As of April 15 1993 the Commission has received 37 comments.  Of these submissions, about half are from persons or organizations with ties to envelope manufacturing or the paper industry; the remainder generally are from environmental interests consumer groups, local government entities, and interested individuals.  At the close of the public comment period, the Commission will review all submissions in the broader context of the inquiry that has been requested.⁵

There was strong opposition from businesses that saw the proposal as a punitive tax.  The proposal went nowhere.  

Many expressed versions of the idea that, “if the public values using recycled paper, mailers will respond and do so without the need for any government involvement.” The following is one such example.

Question 2: The Rate Commission is presently conducting a study on the feasibility of creating a class of mail for mailers who utilize recycled paper.  Would you support this separate class of mail?

Answer:  I would not favor the creation by the Postal Rate Commission of a separate class of mail for mailers utilizing recycled paper.  That would violate the current statutory ratemaking scheme.  I would oppose legislation authorizing the creation of such a class because it would involve an unprecedented interference by the Congress in the business affairs of a selected group of businesses that is mailers.  All kinds of businesses utilize paper in the operations of their business and would not be effectively taxed by the federal government for their failure to use recycled paper.  We see no justification for singling out mailers among all of the business community for such a punitive measure.  On the other hand as the American people become more sensitive to the social value of the utilization of recycled paper and express that sentiment in their consumer choices it can be expected that mailers as well as other businesses will find that it is good business to utilize recycled paper.  Reforms in business behavior of this kind should be generated by the marketplace and not by governmental interference.⁶

While markets can be important drivers of activity, including socially beneficial outcomes, there are myriad ways that markets may break down.  Trained economists know this. But it doesn’t take a degree. We all know this to be true from day-to-day experience.

The last 30 years have demonstrated that the “leave-it-to-the-markets” approach is not resulting in positive change. This is not because there isn’t public interest in sustainability or mitigating climate change. Nor is it because mail recipients and the American public would not prefer mail to be sustainably sourced and fully recyclable. So clearly there is a disconnect.

In this case, perhaps the best explanation for why there has not been a market-generated increase in use of recyclable commercial mail is that the connection between mail recipients and others who value sustainability and senders of such mail is simply too attenuated.  It is exactly in these sorts of cases that government action — which is effectively, collective public action — is both warranted and appropriate.

A punitive tax? Hardly. There is no reason that non-sustainable business practices should be subsidized by the public through the USPS. Those who do not use sustainably sourced and fully recyclable mailing materials are creating a variety of additional costs that we collectively must bear. Moreover, there is no requirement that anyone mail anything through the USPS. If individual entities find a tiered postal rate structure unacceptable, a variety of alternatives are available. Protests against policies that are environmentally conscious and sustainability focused on the grounds that they are punitive taxes ultimately are red herrings. We must move beyond this way of thinking to achieve a sustainable 21st century economy.

To be sure, tiered postal rates for using recycled paper and other sustainable practices is not typically strong click-bait.  It’s not the kind of thing that generates headlines and lots of media attention.  But it is exactly the sort of action that can have meaningful impact, particularly because of the “ripple effects” that implementing the policy could have.

© 2021. Greening Our Mail is an original post from Yaroki, and may not be copied on other sites.

Sources:
¹ See https://about.usps.com/news/delivers-facts/usps-delivers-the-facts.pdf.
² See, e.g., https://morningconsult.com/2021/04/27/paris-agreement-climate-change-threat-poll/. 
³ See https://www.pewresearch.org/science/2020/06/23/two-thirds-of-americans-think-government-should-do-more-on-climate/.
⁴ See Oversight Hearings on the U.S. Postal Service–1993: Hearings Before the Committee on Post Office and Civil Service, House of Representatives, One Hundred Third Congress, First Session, March 25, 30; April 20, 27; June 8, 1993.
⁵ See id., at 52.
⁶ See id., at 144-145.