Chapter One:
INTRODUCTION
The mail carries personal messages, political newspapers, books and magazines, advertising, bills, parcels and campaign literature. It has always had an important role in the U.S. economy, and its role has changed constantly over the last two centuries. Over one million Americans are employed in the publicly-owned or private sector mailing industry. As a public institution, the United States Postal Service (USPS) and its predecessor, the Post Office Department, have had to balance often-competing interests. Service has been provided through contracts with private firms and through direct government activity. The rates paid by mail users have reflected both actual costs and political considerations. The current debate over postal privatization is a result of contending political and economic forces in the United States and in the world.
The term "privatization" can refer to several different processes. In countries where factories or natural resource industries have been nationalized, privatization often means the sale of these entire industries to private investors. In the United States, however, "privatization" generally refers to government contracting with private companies for the provision of various services, from garbage collection to schools, rather than providing those services directly through public employees. In the case of the Postal Service, this is the most frequently-advocated form of privatization.
This chapter will look at the political forces and interests currently supporting privatization, or large scale contracting, of postal service. Is the push for privatization coming from an internal motivation? In other words, does the USPS have problems that must be resolved in this manner? Or is privatization more a matter of "pull" rather than "push" -- the changes driven by those who want access to the market?
This chapter will show that the "pull" factor explains the current assault on public ownership of the postal service by politicians, businesses and their advocacy groups and think tanks. The growing influence of transnational corporations (TNCs) and their expansion into the previously-public world postal and package markets provides an explanation for the political coalitions behind privatization.
Over the course of U.S. history, there has been an ongoing debate over what postal services would be provided, whether they would be provided publicly or privately, how workers would be paid or treated, and how benefits and costs would be assigned. Before considering the current debate, it will be useful to briefly review the history of postal service in the U.S. It will also be useful to look at the current status and performance of the USPS as a public institution. This chapter will look at the literature supporting and opposing privatization and will briefly survey international postal privatization efforts. It will show that postal privatization is not a practical response to demands to cut government costs, nor is it an ideological movement. Rather, it reflects the interests of large businesses to enter a huge, previously government monopoly.
U.S. POSTAL HISTORY: PUBLIC AND PRIVATE HERITAGES
Before considering the current initiatives to privatize U.S. postal services, it is useful to review the history of postal services in the United States. Debates in the past show that there have not been extremely clear lines between the public and private sector, and often the infrastructure created by the public has had a private benefit as well. There have long been disagreements over which portions of the service should be provided publicly and which should be contracted or open to competition.
The United States Postal Service (USPS) was created by the Postal Reorganization Act of 1970, which was finally passed through the Congress partially as settlement of the March, 1970 wildcat strike that virtually shut down the nation's postal service. The USPS replaced the old Post Office Department, whose operations were governed directly by Congress and the President, with a government-owned corporation directed by a Presidentially-appointed Board of Governors.
Postal service has been a responsibility of government since the time before the United States was an independent nation, but there has always been a contentious relationship between the public and private business over the actual provision of services. When British colonial authorities barred journalist William Goddard from distributing his newspaper through the mails, he hired riders and began operating his own postal services that ran from Portsmouth, New Hampshire to Williamsburg, Virginia. The Continental Congress took over control of postal operations in 1775, electing Benjamin Franklin Postmaster General. Franklin had previously served the British crown as a postal official, but had been dismissed for his support of colonial patriots.
The early post roads were essential to the development of the country. City delivery to homes existed in only a few urban areas; for the most part, people went to local post offices to pick up their mail. Rates were high, for it was expensive to carry mail over long distances and to sparsely-settled areas. In many parts of the south, slaves were used as riders until a law of 1802 forbade use of any but "free whites" to carry mail. Postmaster Granger feared that "since the more intelligent were used. . . these might gain knowledge which would make them dangerous to the white people."
By the mid-1840s, private companies had discovered that a profit could be made carrying mail to densely-populated urban areas. More than 40 companies operated in the Boston area alone by 1844, and private carriers handled more mail in New York City than the Post Office Department did. Parcels were not considered mail matter, and letters were often carried by individual riders, stagecoach drivers and railroad employees. The Post Office Department moved to lower and standardize rates in 1845, and a subsequent series of court decisions confirmed a government monopoly over the carriage of letter mail, in a series of decisions known as "The Private Express Statutes."
Before 1855, postage could be collected on the receiving end, but prepaid postage became mandatory after that date. City carriers, however, often collected 1 or 2 cents for each letter delivered because they often had to pay themselves from the receipts. In 1863, the dual system of compensation was abolished, all carriers became federal employees, and free carrier service was begun in 49 cities.
At the turn of the 20th century, free delivery was available to only about 19 million of the 76 million people in the country. Rural people had to travel miles to post offices, which were often in country stores, to receive mail. With support from the newspaper publishers, the first rural free delivery experiment was launched in 1896. Rural carriers were paid $300 per year and, as today, supplied their own transportation. The service became popular and, by many accounts, broke down the isolation of rural Americans. It also increased demand for products that could be ordered and shipped by mail. RFD was treasured by rural residents and spurred improvements in roads, bridges, and highways, since the Post Office would not offer service where roads were bad. It was even credited by Postmaster General George von L. Meyer with reducing the incidence of insanity in rural areas.
A government-provided Parcel Post was a creature of the Progressive-era reform movement, some of whose leaders pushed for government ownership of railroads, telegraph and telephone lines. Private carriers, who handled parcels at the time, and country retail merchants fought long and hard against proposals in Congress to establish a public parcel post. Rural residents strongly favored a public parcel service, however. They were over half of the country's population and were ill-served by the oligopoly of three private express companies -- Wells Fargo, American Express, and Adams Express. The parcel companies had arrangements with the railroads allowing them to attach special cars to trains. During a Congressional debate over government parcel service in 1911, Wells Fargo declared a large dividend to stockholders, and the resulting public outrage at the high profits pushed the reform through. Parcel post service began in 1913, and the mail-order rural market expanded rapidly. Private parcel carriers remained in business but were unable to compete in the large home delivery market with a public service that took advantage of existing infrastructure. United Parcel Service, a private company which is currently the leading package carrier, began in the early 20th Century by making custom arrangements with department stores in urban markets and expanded from that base.
POSTAL WORKERS AND THEIR UNIONS
In a large and rapidly-growing country, the workers for the expanding Post Office Department became a large constituency. Postal workers began to form labor unions in the 1870s, first joining local Knights of Labor Assemblies or forming city-based associations. Congress had passed an eight hour law for federal employees in 1868 but excluded Post Office workers from the legislation, so postal employees worked through the Knights or other local, often secret, associations to agitate for the eight hour day. They had their first Congressional champion in Congressman Samuel "Sunset" Cox, a Democrat who had represented Ohio and New York during his long career. With Cox's help, the eight hour law was passed for letter carriers in 1888, and the National Association of Letter Carriers, the union that exists today, was formed in 1889.
Clerks organized their first union, the United National Association of Post Office Clerks, largely regarded as a "company union," in 1894. Clerks participated in other labor movement campaigns on local levels, and in 1900, Chicago clerks requested that the American Federation of Labor charter a union. Soon, the National Federation of Post Office Clerks formed local organizations in many cities. The clerks hoped the legislative committees of the AFL could help them approach Congress for reform, since a Presidential "gag" order, instituted after a 1901 lobbying effort, made it illegal for them to lobby Congress in their own behalf.
Postal union members were often fired for their labor advocacy, and not until the passage of the Lloyd-LaFollette Act in 1912 could they even appeal to Congress to improve their pay or conditions. This modest reform was vigorously opposed by the National Association of Manufacturers. Postal workers pursued their interests primarily through lobbying and never struck or formed industrial unions during the more militant labor struggles of the 1930s. The Wagner Act did not allow government workers to bargain collectively, and President Roosevelt spoke against collective bargaining for government workers, saying "the very nature and purposes of government make it impossible to bind the employer in mutual discussions with employee organizations."
Through the 1950s, postal workers lobbied, demonstrated, and even held prayer services as their wages fell behind inflation and below comparable private sector wages. President Kennedy signed an Executive Order in 1962 that recognized unions' right to bargain for federal workers, except they couldn't bargain wages, hours or benefits, and there was no enforcement mechanism if management would not negotiate. Arbitration was only advisory; strikes were illegal.
But in 1970, postal workers had reached an economic breaking point. With many workers having to "moonlight" to get by, and with Congress voting themselves a pay raise while stalling postal wage increases, letter carriers in New York City voted to strike on March 17, 1970. Their picket line was honored by other postal employees and the strike spread to many cities and throughout the country. Effectively, the postal service was shut down for the nation's centers of business and politics.
The strike, centered in New York City, was highly effective. Wall Street's check was truly "in the mail" in those times, and the pressure on the workers, and on business and trade, was extreme. President Nixon sent 25,000 National Guard and army troops, some rolling down the streets of New York in tanks, into post offices to attempt to sort and deliver the mail. They were unsuccessful in breaking the strike, but on March 25, postal union leaders signed a return to work agreement and the workers went back. The strike had won a 6 percent wage increase retroactive to December 1969, with an additional 8 percent upon the enactment of the proposed Postal Reorganization Act. The unions, which had opposed reorganization until that time, became its sponsors. The Act established collective bargaining for wages, hours, and working conditions for the first time, though it outlawed the union shop and strikes. Binding arbitration was instituted to resolve contracts and grievances. Within a few years, postal workers were some of the best paid federal employees.
POSTAL REORGANIZATION
The Postal Reorganization Act of 1970 changed the governance of the national postal system. The Act stated that "The United States Postal Service shall be operated as a basic and fundamental service provided to the people by the Government of the United States. . . the Postal Service shall have as its basic function the obligation to provide postal services to bind the Nation together through the personal, educational, literary, and business correspondence of the people. It shall provide prompt, reliable, and efficient services to patrons in all areas and shall render postal services to all communities."
The legislation went on to say that "As an employer, the Postal Service shall achieve and maintain compensation for its officers and employees comparable to the rates and types of compensation paid in the private sector of the economy of the United States." Strikes remained illegal, although otherwise most workers were covered by the provisions of the National Labor Relations Act.
The eleven-member Board of Governors was defined and granted the power to manage the service. The law stated, "Nine of the members, to be known as Governors, shall be appointed by the President, by and with the advice and consent of the Senate, not more than 5 of whom may be adherents of the same political party. . . The Governors shall be chosen to represent the public interest generally, and shall not be representatives of specific interests using the Postal Service."
Labor relations in the postal service have been contentious, according to union officers and political observers, but disputes have not taken the form of work stoppages, with minor exceptions. Conflict is manifested through stalled negotiations, huge backlogs of grievances, thousands of Unfair Labor Practice complaints, and the service's high rate of internecine violence. A brief wildcat strike occurred in the 1970s but succeeded in shutting down only two bulk mail facilities, one in California, and one in New Jersey. Postal workers overwhelmingly sign up for union membership; postal unions have among the highest documented membership rates in any open shop environment; the American Postal Workers Union and the National Association of Letter Carriers, the two largest unions, claim that over 80% of eligible workers join the union, and 90 percent of career employees are covered by collective bargaining agreements.
USPS AND CONTRACTING: CRISIS DRIVEN?
It would be incorrect to see the Postal Service's contracting and moves toward privatization as being driven by a financial or organizational crisis. In fact, USPS, has a good record of on-time delivery, residential customer satisfaction, and financial performance. Viewed over the long term, the USPS has had this successful record of service provision largely without government subsidy. Also, despite predictions of the "coming collapse of the post office," (Prentiss-Hall published a book by that title in 1975) due to competition from United Parcel Service or due to the increase in electronic messaging, the mail volume has grown steadily since the 1970s.
The Postal Service ranked, by 1996 sales, as the tenth largest US corporation on the Fortune 500 list, with $56 billion in annual revenue and 38,000 facilities (see Table 1). Mail volume growth through the 1970s and 1980s continues in the electronic age, with 1.5% growth in 1994 and 1996, and 4.1% growth in 1997 (see Table 2). The number of employees, despite management and labor predictions alike of downsizing due to automation, remains high. In 1970, 662,467 career (not temporary) employees worked for the Post Office; today, despite a revolution in mail sorting technology, the number of career employees is 765,174. Fortune magazine's December 1996 issue credited the USPS with improving its service more than any other company or agency in America. Audits by Price Waterhouse found on-time delivery in 1997 as 92%.
Postal operations produced a $1.3 billion surplus in 1997, and from 1995-1997 the USPS earned a net $4.6 billion. This compares with a total $9 billion in losses in the first 23 years after the reorganization.
Emerging electronic communications technologies threaten to reduce volumes in the future and eventually make some of the mail obsolete. An article in the December 22, 1996 Los Angeles Times predicted the loss of between 8 billion and 30 billion of the 180 billion pieces of mail delivered each year by the year 2000. The steady mail volume growth between 1995 and 1997 shows this has not yet begun to occur, but the Postal Service's own annual report predicts an eventual loss to electronic transmissions.
A study published by the Universal Postal Union (UPU, based in
Bern, Switzerland) predicted that the share of physical mail (letters) in the global communication market will drop to 14.5 percent in the year 2005, down from 19.6 percent in 1995, while e-mail will convey 11.6% of all messages (up from 5.2% in 1995).
The growth of internet-based product sales, though, has boosted the volume of parcels shipped. "This may sound like a paradox," said Jean-Remi Gratadour, head of new technologies at the Institute for Postal Research and Perspective (IREPP) in Paris, "but advances in information technology, far from undermining direct mail, are stimulating demand for a more efficient distribution system for paper mail and parcels." Catalogue and parcel volumes are rising, with more people ordering merchandise from their homes, via computer or printed catalogue and telephones, and physical distribution is still required. In the parcel area, USPS faces stiff competition from major providers such as United Parcel Service and Federal Express.
The Postal Service managers and the advocates of privatization have long complained about the "over 80%" of postal costs being attributable to wages and benefits of its workforce. While its labor costs are higher than its competitors', the 1997 Annual Report shows that figure has dropped to 77%. Prices of stamps initially rose faster than inflation during the first years of reorganization but have stayed basically even with consumer prices since the mid-1970s (see Table 3). The current 32 cent first-class stamp is a relative bargain compared with the rest of the industrial world; Japan charges the equivalent of 83 cents, Great Britain 42, and Germany 58.
The Postal Service has continued to invest in research and development, contrary to claims by E.S. Savas, author of Privatization: The Key to Better Government. Savas says that government operations do not do the kind of research and development that private industry does and that "the private sector tends to use more productive and more expensive capital equipment." The USPS has been aggressively investing in development of new technologies for two decades. In fiscal years 1994 and 1995, for example, the USPS invested $102.4 million in R&D. The postal service began the development of Optical Character Reader (OCR) technology in the 1960s, though the OCR was not used extensively in mail processing until the 1980s. The USPS developed remote video encoding technologies and its plans call for over $4 billion investment in OCRs, Bar Code Sorters, Delivery Bar Code Sorters, and facer/cancellers for the period from 1987-2005. Total capital projects from fiscal 1998-2004 are projected at $17 billion.
Public perceptions of postal service are positive and have improved in the last decade; there is no large scale public dissatisfaction driving privatization or contracting of postal work. In a 1997-1998 survey, the Pew Research Center for The People & The Press found that 89 percent of respondents rated the Postal Service favorably, topping the scores for all government agencies. The next closest positive score was an 85 percent favorable rating for the National Park Service. The Postal Service's score had jumped 13 points since 1987. By contrast, the Internal Revenue Service scored a 38 percent approval rating, and the CIA a 51 percent approval rating. Independent surveys by Price Waterhouse have shown Customer Satisfaction Index scores in the high 80th percentile to mid 90th percentile (people rating their service as "good" or "very good") since 1990.
There is no financial crisis or public perception crisis driving efforts to privatize or contract out portions of the US mail. From time to time, the conservative think tanks have complained about rates, largely blaming wages, and periodic complaints about bulk mail service arise. When pressured, the Postal Service has responded to such complaints by reorganizing management, adding workers, or altering schedules.
The advocates of reform do not argue a "crisis;" rather, competitors and subcontractors argue "unfair competition." The advocates of privatization want a share of a lucrative, globalizing market and have the political influence to affect government policy on postal issues. In addition to the well-funded efforts of the leading conservative think tanks which will be described later, the service's major private sector competitors are important contributors to political campaigns. United Parcel Service doled out more than $3.4 million to congressional candidates from 1993 to 1995, more than any other company in America, and Federal Express was third, behind AT&T.
SUPPORT FOR, AND OPPOSITION TO PRIVATIZATION
This section will examine the literature produced by supporters and opponents of privatization. Several political constituencies are involved in the debate currently taking place concerning the Postal Service, since many groups have an important interest in the mail that reaches every home and business six days per week. Businesses large and small, non-profit organizations and religious groups, local, state and federal government, and virtually every household use the mail to carry out some or, sometimes, most of their activities. Organizations that represent publishers, non-profit mailers, labor unions, and advertising mailers all have almost-permanent lobbying presences on Capitol Hill to attempt to influence postal rates and policies.
The conservative think tanks, most notably The Heritage Foundation, the Cato Institute, and the American Enterprise Institute, have been the most prominent political voices advocating postal privatization. There has also been lobbying by United Parcel Service and Federal Express, the two largest non-governmental mail and parcel companies, to restrict expansion of USPS services and to relax regulations that favor government over private service. If privatization is backed by the middle class or blue collar social conservatives who have tended to vote Republican in the last two decades, they have not made it part of their political campaign priorities. In fact, the opposition to privatization among rural residents pushes in the opposite direction. The important political backing for concrete steps to privatization comes, rather, from the largest corporations in the mailing, publishing, and advertising industries and from contractors (or potential contractors) in the high-tech defense and information sectors, as shown by their political support of think-tank proposals and from their presence on "reform" task forces.
The most significant and best-organized constituency opposing postal privatization is the postal work force, represented by four labor unions which bargain for the over 700,000 hourly workers. The unions fear privatization would mean the loss of secure, living-wage jobs; there is an institutional interest, as well, because postal labor organizations' bargaining relationship and organizational forms have been constructed to conform to the structure of the Postal Service since its 1970 reorganization. The four labor unions that organize the majority of postal workers have no members outside the USPS; therefore, they see their survival as largely dependent on the maintenance of the public system.
PROMOTERS OF PRIVATIZATION
The arguments for privatization have been extremely ideological and, despite considerable municipal, state, and federal experience have seldom called attention to results of case studies or acknowledged the commercial interests of privatization supporters. The literature contains radical statements opposed to government "interference" in market affairs and advocates radical reductions in government and public infrastructure.
Opposition to unionized work forces is a central feature of privatization literature. For instance, Douglas Adie argues in his 1989 book, Monopoly Mail, "Postal labor unions . . . serve no productive function but enjoy support that is indirectly derived from government subsidies, favors and recognition, In return for this, the unions make implicit threats of violence during illegal postal strikes. . . " . E.S. Savas, head of the Privatization Research Organization in New York, says "In the public sector, as we all know, it is virtually impossible to get rid of a malperforming employee."
Why is hostility to unions such a central feature of privatization literature? Most obviously, there is the issue of wages. Since unions tend to enable workers to negotiate higher wages in public or private operations, the wage premium does tend to increase costs or, in private operations, diminish profits. Private postal and express operations are often able to establish and to hold wages at levels far below union-negotiated scales and often to hold benefits costs to near-zero (See Table 4). This issue will be explored further in Chapter 3 below. But unions also tend to do something else that is critical in the process of privatization: they have tended, historically, to initiate and defend public ownership in a variety of areas, from Social Security to schools, to unemployment insurance, to telecommunications and postal systems. They are the primary opponents to postal and telecom deregulation and privatization and have been able to organize effectively on a national scale and within the European Economic Community. With their power constrained and their membership lowered, unions would be less of a political obstacle to the kinds of legislative change that are essential for privatization and for global deregulation that is necessary for the development of private telecom and express markets.
The debate over postal privatization is currently focused on a bill proposed to the 105th Congress: HR 22, The Postal Reform Act of 1997, submitted by Rep. John McHugh (R-NY). McHugh chairs the Subcomittee on the Postal Service of the House Committee on Government Reform and Oversight. HR22 is an appropriate focus for this discussion, because the changes proposed in the legislation closely reflect a growing consensus among private express shippers, bulk mail lobbying groups, and postal officials.
There are no serious legislative efforts, nor have there been during the last decade, to sell the entire postal system to a private company. There is no funded or organized political constituency for such an idea. Rural mail service, some daily household service, and retail counter service are expensive operations that do not bring in net revenue. Most of the proponents of extensive contracting would prefer to leave the expensive parts of the system in public hands, even publicly subsidized, and let private industry profit from the technologically improved, centralized, or concentrated operations that can generate profit. The far more extensive contracting advocated by privatizers would disrupt the economies of scale of the natural monopoly, and the public would have to socialize the high costs of rural delivery if people felt it was important to retain this service. The benefits of high-tech and higher-revenue operations would then be privatized to the contractors.
THE "THINK TANKS" AND US POSTAL PRIVATIZATION
There have been nearly two decades of political discussion about privatizing the postal service. The leading policy advocates for postal privatization have been The Heritage Foundation, the Cato Institute, and the American Enterprise Institute. Between them, Heritage, AEI, and Cato have produced most of the policy studies and press releases supporting postal privatization and have served to coalesce the interests and political proposals of large mailers and contractors alike. Opposition to privatization is voiced by the labor-supported Economic Policy Institute and by labor-connected policy organizations, such as the AFL-CIO's Human Resources Development Institute and its Public Employee Department. The "moderate" Progressive Policy Institute, the organization closest to President Clinton and the Democratic Leadership Caucus, states opposition to "privatization" but supports "reinventing government," "entrepreneurial government," and large scale contracting of government and postal services.
Heritage, AEI, and Cato have grown in influence, funding, and staff since the 1970s, when politically active conservatives, distrusting the research and policy work done at universities, argued that business would have to become more ideological and focus on influencing political action. The American Enterprise Institute was formed in 1943 but lacked significant influence until the mid-1970s, when it began to mass mail op-ed pieces to local newspapers, circumventing the Washington "elite" press corps. Heritage was founded in 1973; Cato in 1977.
The foundations receive most of their money from large corporations. AEI drew 51% of its 1985 $12 million budget from corporate donations. Significantly for postal contracting, as will be shown later, corporations with roots in the defense industry, but currently expanding their non-military contracts with government, are significant sponsors of AEI and Heritage. Reader's Digest Association, a major mailer and corporate member of numerous postal advisory committees, substantially funds Heritage, and Reader's Digest CEO James P. Schadt is on the Board of Trustees of AEI. AEI's staff includes Robert Bork, Dinesh D'Souza, Irving Kristol, Gerald R. Ford and Jeane Kirkpatrick. Many of former President Ronald Reagan's cabinet members, appointees and advisors came from Heritage and AEI, and the Heritage Foundation's 1000- page book, "Mandate for Leadership," came to be known as "the bible of the Reagan Revolution."
AEI published a study of the Private Express Statutes as early as 1974, arguing that there was no economic justification for the public monopolies and that entrepreneurial innovation was being stifled. The institute also published a study of postal wages in 1977. Heritage's 1981 Mandate for Leadership advocated a general approach to introducing competition into markets under postal monopoly. The principles laid out in this early work still continue to guide the conservative agenda for postal privatization. The book's chapter on the Postal Service was authored by James I. Campbell, Jr., who is identified as former counsel to DHL Corporation. DHL is a globally operating express, courier, and trucking company that has challenged public postal monopolies in many countries. Campbell later testified at the House of Representatives, Subcomittee on the Postal Service hearings in 1995 as counsel to Federal Express Corporation.
First, Campbell argued that postal wages and benefits were too expensive and laid the blame on the collective bargaining system begun after the 1970 postal strike and passage of the 1970 Postal Reorganization Act. The author quotes AEI's Douglas Adie in his claim that postal workers "earn in excess of 40% higher wages than the average American." Second, the author complained that because of these excessive wages, postal prices had risen far beyond inflation and that there was no built-in incentive for the Postal Service to control costs. Campbell also claimed the postal monopoly over the carriage of letters was being expanded and the Postal Service was venturing into areas where it "didn't belong," like electronic communications.
The report recommended that then-President Reagan "keep his distance" from the Postal Service and not attempt to "re-politicize" it or regulate it, but use competition to achieve change. The three strategies preferred by the foundation were 1) construing the postal monopoly very narrowly, so that other carriers could compete, 2) appointing members to the Postal Rate Commission and Board of Governors who share the conservative agenda, and 3) restrict the Postal Service from expanding the scope of its operations.
The Heritage report warns of the reaction of Americans who support and depend upon universal service and uniform rates, though the authors fail to see "why a uniform first-class mail rate is in the national interest." The report also cautions that rural political constituents, fervent in their attachment to universal service, should not be provoked by policies that damage rural service. The report recommends that rural service be directly subsidized through general federal funds rather than provided for through the functional cross-subsidization of postal operations.
The Cato Institute published The Last Dinosaur: The U.S. Postal Service, by James Bovard, in 1985. Bovard repeats the Heritage/AEI theme that "postage rates are skyrocketing because postal wages have long been out of control" and argued that "The ideal solution is to open the floodgates to private competition."
By 1988, the Bush administration had created the "President's Commission on Privatization," which held hearings on privatizing the postal service and recommended repeal of the private express statutes through a phased-in method and exploration of the possibilities for private ownership of the USPS. The Commission advocated immediate removal of the private express restrictions on third class, urgent, and rural mail (making no immediate suggestion as to how rural mail would be provided for) and called for immediate repeal of the existing prohibition of private companies' use of letter mail boxes. Further, it recommended that the USPS "more actively pursue contracting out opportunities in all its functions, and should focus special attention on retail, delivery and sorting functions." The language and recommendations in the report echoed the think tank proposals. The Commission, however, admitted that "opinion polls show the public at large is fairly satisfied" and that the public seemed to fear that any proposed changes would likely be for the worse. They argued that major mailers' dissatisfaction with rates was more important because "while the consuming public may be relatively satisfied with postal services, it is important to keep in mind that more than 92 percent of all mail either originates from or is destined for business and only 17.5 percent of mail originates from households. The consuming public is a minor customer of the USPS, and postage is usually a minor component of a given household's budget. However, for business mailers, postage can be a fairly high proportion of the budget, and high-quality service can be critical."
The proposed 1988 reforms, however, were not well developed or seriously pushed and failed to materialize. In fact, throughout the 1980s, no legislation to repeal the Private Express Statutes made it out of Congressional committees. The only time such legislation made it to the floor was in 1975-76, and it was overwhelmingly defeated in 82 to 6 Senate, 319 to 68 House votes. In 1989, Douglas K. Adie of the Cato Institute called for a deregulation and privatization of the USPS that would take methods from the 1980s AT&T breakup, creating seven separate regionally-based corporations supervised by a "postal investment corporation." Adie characterized the Postal Service as "a welfare system within which first class, urban, and some business mailers subsidize other classes of mail, rural mailers and homeowners (sic)." His "breakup" proposal received no independent corporate nor much legislative support. Instead, privatization efforts were shifted toward contracting and creating opportunities for national-level competition.
A more concrete think tank/administration strategy began to emerge in 1989-90. The third volume of Heritage's Mandate for Leadership repeated general recommendations from the previous volume but warned that "a White House suggestion to repeal the Private Express Statutes, however, is sure to mobilize opposition and doom all other achievable attempts at postal reform." Instead, Heritage recommended that the Bush administration appoint "reform-minded" officials, appoint a presidential commission to review performance, strengthen the administration by the Board of Governors by giving it an independent full-time staff, establish a two tier wage scale and work rule changes, experiment with use of private carriers in rural areas, loosen restrictions on urgent and advertising mail, expand contracting out, create an independent monitoring system, keep the Postal Service on the federal budget, and prohibit USPS from developing new markets and new products. The Bush administration and the postal administration were able to implement the two-tier wage, the independent monitoring system (by Price Waterhouse) and the expansion of contracting out work.
DEMOCRATIC PARTY AND ADMINISTRATION
The Democratic Party and the Clinton administration formally oppose privatization of the USPS yet support large scale contracting of its functions. In an address to the 1996 convention of the American Postal Workers Union, First Lady Hillary Clinton promised that "the President will not allow the Postal Service to be privatized," but the Clinton administration has followed the path laid out by Republican administrations and has not put forth an alternative vision for the Postal Service. Before the 1992 election, Clinton's think tank, The Progressive Policy Institute, called for the new administration to "inject further competition into the delivery of federal services, such as those provided by the General Service Administration, the Postal Service, Amtrak, the military, and the Coast Guard." The PPI urged the Postal service to "use competition to improve" the agency. "Some postal functions -- management of post offices, sorting facilities, even local mail delivery -- could be contracted out on a competitive basis," they said. Both the President and Vice President adopted the term "reinventing government," taking ideas and political arguments from David Osborne and Ted Gaebler's 1992 book of that title. While Osborne and Gaebler did not focus on the Postal Service in their recommendations, they criticized its monopoly and high labor costs and implied solutions similar to Heritage's and Cato's.
LABOR AND LIBERAL OPPOSITION
The labor and liberal arguments against privatization have shied away from ideological statements about the obligations of government and have tended to concentrate on issues of costs, impact on workers, and service quality. The studies and papers sponsored by prominent labor and labor-supported groups have examined and challenged assertions that privatization saves public money and results in better service quality. The studies have not, however, looked at privatization and government contracting as an industry strategy and have not examined large-scale contracting over time. They have tended to look at many different cases of contracting on a local, state and federal level and have identified the push for privatization and contracting out as coming from government, not from private industry. These assumptions can be misleading; they tend to focus all opposition energy on answering conservative arguments and proving that privatization produces higher costs. The result is that unions do not pay much attention to the political and economic strategies and material interests of corporations that go after contracts.
An example of union literature that identifies privatization as a cost-cutting or ideological strategy is the AFL-CIO Public Employee Department publication, The Human Costs of Contracting Out: A Survival Guide for Public Employees and its predecessor, America: Not For Sale. In the Preface, Public Employee Department President Al Bilik and Secretary-Treasurer John Leyden stated that unions all over the country heard "the same sad story of a budget crunch or a right-wing politician which resulted in the contracting out to lower paid employees and poorer services." They explained that "contracting out provides government officials with a quick way to make the budget balance--even if down the road it ends up costing more."
The Public Employee Department literature includes case studies of contracting and its negative impact on wages and service levels. It counterposes labor/management cooperation in the public sector to contracting as a way to improve service and achieve costs savings.
Literature by postal labor unions generally presents a vision of a fragmented, small-business postal market under privatization, in which many different companies compete to deliver mail to homes. The American Postal Workers Union publishes no comprehensive studies on privatization. The National Association of Letter Carriers, in their 1988 pamphlet, The Case Against Privatization, argues for the efficiency of the regulated monopoly under public ownership but does not identify any specific parties who support or would profit from privatization. The argument in the pamphlet is directed against privatization through employee ownership of the USPS. The American Postal Workers Union, recently faced with the contracting of large portions of its traditional work to Emery Airlines, has shifted its rhetoric to oppose "big corporations" but has not addressed the governance methods and policies of the USPS which favor those corporations.
The Economic Policy Institute, a labor-supported liberal think tank, has issued several pamphlets on privatization. Their studies have tended to assume that cost-cutting and right wing ideologies are the primary motivations for the push to privatize. The Institute published Princeton Professor Paul Starr's paper, "The Limits of Privatization" in 1988. Starr identifies privatization with "right wing simplifications" and argues for a "pragmatic public policy" that "must recognize where private alternatives might work better, and, by the same token, where new forms of public provision may ameliorate endemic shortcomings of the market." Starr is ambivalent about privatization and, without citing specific studies or data, suggests that "the rationale for the postal system as a public enterprise may be an anachronism 25 or 35 years from now. . ."He suggests that "we might well consider selling some of its (USPS) assets, such as downtown distribution centers."
Subsequent publications by the Economic Policy Institute have similarly identified privatization with (unsuccessful) cost cutting and right wing ideologies. The most recent study from EPI, The Privatization of Public Service: Lessons from Case Studies, by Columbia University Professor Elliott Sclar, examines three case studies of municipal and state contracting and concludes that "privatization is not a successful method for ensuring that citizens get the services they require from government in a cost-effective manner." The paper identifies "privatization" with conservative politics and suggests that it is a new label for an old idea, contracting to private companies, "in the service of an ascendant political ideology." Sclar also reflects this perspective in an article in the Summer, 1994 issue of Dissent, when he says "that the right's concern is ideological rather than pragmatic is revealed by the penchant among conservative privatization advocates to oppose careful cost analyses." Starr sees privatization as driven by ideologues, not by corporations.
The studies by liberal and labor groups have been successful in showing that costs are seldom reduced over the long term and that the source of profit, or any reduced costs, come from the lower wages paid by contractors. They successfully argue that a community does not benefit by lowering the income of its working citizens. The conservative foundations and politicians do promote the idea that private business is always more efficient than public service, and it is important to show that the public generally does not save money by contracting services to private companies.
A MORE SATISFYING EXPLANATION:
TRANSNATIONAL CORPORATE INTERESTS
These studies, however, beg, but do not answer, the question: If lower costs and community benefits do not result from contracting out, why do politicians persist in contracting? The only satisfying answer is that the political power of the contracting corporations outweighs the political power of unions and other groups that benefit from publicly-provided service.
More satisfying explanations for increased government contracting and political pressure for privatization are provided by economists Edward S. Herman and Laurie Clements. In a 1991 article, Clements explains that "privatization on the global scale is linked to the global restructuring of capital and the world division of labor." He shows that privatization is part of the redefinition of the role of the state and says that "international capital mobility has supported privatization initiatives, and, conversely, privatization facilitates such capital mobility." Clements' paper does not focus on a particular case study, but recent privatization of postal services bear out his view, as will be shown below. Edward Herman agrees that "the privatization wave over the past twenty years is rooted in increased corporate power." He also ties privatization to international capital restructuring and identifies the "resurgent business and financial community" as the most important forces behind international privatization.
All of the literature that opposes privatization characterizes it as a threat to democracy as accountability for government services and functions is lost. This literature also places unions at the center of a broader public coalition to defend public services and make them serve effectively. Clements calls on unions to appeal to private sector workers and the public in general and work to improve public services.
It is important to address the legitimate concerns of citizens and officials in controlling the costs of government, and union and liberal literature generally explains that contractors seldom live up to their promises of cheaper service, and, if they are successful, the "savings" ultimately come out of workers' pockets. It is also important to show the roots of these policies in conservative ideology and in the financial backing corporations provide for the foundations that promote this ideology. Unions are at a disadvantage in answering these arguments because they do not have the funds and access to mass market media, but they also stop short of providing a convincing explanation for the push for privatization. They also pose no strong political alternative, because they, for the most part, support the Democratic Party politicians who often initiate contracting. If unions respond by organizing workers in contracted operations, they can slow down the process and protect some of the interests of their members, but they cannot provide answers for the general public. If, however, they are willing to examine and critique the collusion between public officials and corporate contractors, they are challenged to put forward a clear alternative and form another, as yet nonexistent, political coalition.
GLOBALIZATION, PRIVATIZATION, AND INFRASTRUCTURE
The process of postal privatization, and the debate about it, are not restricted to the United States. The globalization of trade and finance have an important relationship to both domestic and international privatization. In almost every country, postal and telecommunications operations are being restructured or "reformed." As markets increasingly cross national boundaries, transnational corporations in the shipping, express, and communications industries provide infrastructure and service and profit from this trade. The US Postal Service's $56 billion revenue comes from handling 41% of the world's mail volume,but this volume figure does not include the international mailing and package delivery business done by private transnationals. Clearly, the world market in postal services is lucrative and potentially profitable, especially if a corporation can provide services or equipment in many different countries.
Privatization is an essential part of the transformation of global markets and international economic restructuring. The modification of the role of the state in economies opens up opportunities for private organizations to expand their rates of profit, and transnational corporations (TNCs) are most able to take advantage of, and push for, deregulation, contracting and sales of government operations. Their role in postal privatization is key.
Deregulation and privatization are important to globally-operating corporations because they permit new entry, eliminate subsidies, and provide large businesses and corporate service users with substantial cost savings from a variety of sources, including lower labor costs. As Rutgers Industrial Relations Professor Jeff Keefe explains, "This provides large corporations with an international competitive advantage due two factors: lower supply costs and the most advanced network structures, which become the world standard, allowing them to move globally within a familiar infrastructure. In transportation industries, deregulation has caused a fairly spectacular wave of bankruptcies and failures, which was then followed by national and now international consolidations -- national and international oligopolies replaced local or regional monopolies."
A special section on privatization in the October 2, 1995 Wall Street Journal was entitled, "Sale of the Century," and made clear the business interests in international privatization. Full and half-page ads from many of the worlds high-tech, telecommunications, transportation, and manufacturing firms dominated the pages. An article tracing the political heritage of privatization cited the first "milestone" as Gen. Augusto Pinochet's coup in Chile and subsequent privatization of public enterprises and cooperatives.
The value of services surpassed that of goods in international trade in the 1980s, and business services, of which postal services are a part, led the way. Global trade is centered in transnational corporations, which accounted for two thirds of the value of all exports by 1993, according to the U.N. The technological innovations in telecommunications and information are changing the way mail is processed, and many of the transnational communications corporations are important contractors with the U.S. Postal Service and other national systems. Firms like Siemens, IBM, NCR, Lockheed, and Hewlett Packard are characteristic. TNCs also operate mass mail advertising and mail order businesses, like Time-Warner and Bertelsmann (BMC). Deregulation and privatization have been key to the establishment of global corporate business networks across many formerly public jurisdictions, and most of the TNCs have been political advocates of postal and telecom deregulation and privatization. Advocates of privatization imply that modernization is dependent on privatization, but Puerto Rico's technical and financial success with its national phone company and Sweden's establishment of universal public internet access are only two examples of innovative public services which belie these claims.
Private shippers Federal Express and United Parcel Service have challenged the U.S. Postal Service's control of international mailing rates and policies. The USPS represents the United States in the Universal Postal Union (UPU), an international organization that sets postal policies and funds transfers between countries. A bill introduced into Congress in June of 1998 would replace the USPS with the U.S. Trade Representative in the UPU. The obvious intent is to open up competition for all international shipping, not just for parcels and expedited materials. The Postal Service opposed the bill, citing a threat not from private U.S. shippers, but from Britain’s Royal Mail and Dutch Mail, who have privatized a portion of their postal services. The privatized segment is seeking to win for-profit shipping business in other countries.
GLOBAL SHIPPERS CHALLENGE PUBLIC SERVICES
National postal monopolies are being challenged worldwide by transnationals in the package shipping and mailing industry, including TNT, the Australian trucking, express, and remailing company, DHL, the express courier, Federal Express, and United Parcel Service. European studies report a tremendous growth in the parcel and express industries and companion congestion and pollution problems in cities. According to a study by the Post, Telephone, and Telegraph International, deregulation and relaxation of postal monopolies have been the single most decisive factor accounting for the prominence of these firms.
United Parcel Service has aggressively pursued a privatization agenda, charging the German Deutsch Post with "unfair competition" in the European Union. In France, UPS is suing the postal service for its joint venture with another package delivery company. When British postal workers struck in 1996, the government temporarily suspended the postal monopoly, but, according to London's Times, "the big four international courier companies -- TNT, DHL, United Parcel Service and Federal Express -- have said it is not worthwhile attempting a rival service for only one month." TNT, however, has pushed the government for a "duopoly," under which it could deliver "slow" mail. In New Zealand, TNT offered to deliver Christmas cards anywhere in the world for 77 cents, and UPS partner Mailboxes Etc. also offers international services.
The World Bank is aiding the process of private corporations' investments in formerly-public services. World Bank officer Kumar Ranganathan announced that the bank was prepared to invest in postal "reform" at the Universal Postal Union's 1996 conference in Berne, Switzerland. He said that all posts had to recognize that they were in the communications business and indicated that the WB would facilitate private investment in deregulated postal services.
U.S. OFFICIALS STUDY "SUCCESSFUL" PRIVATIZATIONS
Substantial deregulation of postal services has taken place in several industrialized countries. In January of 1996, the House Subcommittee on the Postal Service and the Senate Subcomittee on Post Office and Civil Service held hearings entitled, "United States Postal Service Reform: The International Experience." Representatives of national postal services in Sweden, Australia, New Zealand and Canada described their deregulation policies, and the Government Accounting Office and Price Waterhouse reported on international privatization and reform. Congressman John McHugh reported that "many deregulation and privatization proponents cite the examples of foreign posts as blueprints for privatization of our postal system."
Each postal administration that testified operated a system that was still government-owned. While all except Sweden showed reduced labor costs and successful price controls, most had decreased rural service and allowed substantial private entrance into the parcel and express markets.
Only Argentina has totally privatized its mail service, and the experience has led to scandals and public anger. Mass protests have occurred over the government's entire privatization program. "The huge profits from privatization are not reaching the average person," said Arturo Valenzuela, director of the Center for Latin American Studies at Georgetown University, yet, according to the Washington Post, "foreign investors, especially those from the United States and Europe, remain bullish on the Argentine economy and continue to invest at a rapid pace. "The rich are getting richer, and we've become the forgotten people again," said a teacher from the country's rural provinces who was helping lead a hunger strike against privatization at the steps of the Congress.
Previously, Argentina had a "duopoly," in which a courier service run by private postal magnate, Alfredo Yabran, had a substantial share of the market. Yabran was accused of corruption in seeking to monopolize the planned privatization of Argentina's post office. He had close ties to then-President Carlos Menem and was accused by the economy minister of bribery, coercion and money laundering. President Menem signed a decree to privatize the post office in March, 1997, and an Argentine consortium -- Banco Galicia and Grupo Macri-controlled companies Itron and Sideco -- won a 30-year concession to run Argentina's state postal service, with the technical backing of the British Post Office. The group offered to pay the state approximately $102 million annually for the next 20 years to run the Correo Argentino, over 40% more than the amount offered by bidders including units of Citicorp and ING Bank of the Netherlands. Francisco Macri, principal of Grupo Macri, has as partners the Western Union unit of First Data Co., General Electric Co., and Microsoft Corp.
Two European postal services, publicly owned, were involved in the Argentine bidding. The deregulation and corporatization of the Dutch, British and German postal services have allowed them to operate as private companies and bid to run other nations' postal operations in partnership with other corporations.
While privatization proponents admire the abolition of the public monopoly on mail delivery in Sweden, Sweden Post remains publicly owned and has been successful in expanding the types of services it offers. The strength of labor unions in Sweden has determined the outcomes substantially, and privatization advocates hesitate to call attention to the differences between Sweden's reform and those of other administrations. The Swedish postal service lost its letter monopoly in 1993, but the government system was more economically viable than any of its competitors for letter mail and has made a profit in every year since the deregulation. Sweden Post has also provided electronic mail and promoted its use.
Swedish unions represent about 90 percent of the labor force, and private companies had to compete on factors other than the ability to pay low wages. The influence of the unions and socialist or social-democratic political parties in the government have ensured that the postal reform contained provisions that benefited residential customers, such as subsidized stamp prices for households. While 30 companies competed with Sweden Post as of 1996, they operated only within local markets. City Mail, the best-known private operator, twice filed for bankruptcy and eventually went out of business. Sweden's extremely high unionization rate and extensive wage and social benefit protections meant that private companies could not make profits by drastically cutting wages as they could in other countries. With an innovative public system and effective worker protection, private companies have difficulties making profits despite deregulation.
MASS PROTESTS OF PRIVATIZATION
Deregulation of telecommunications and privatization of national telephone companies have caused mass strikes and protests as international telecommunications corporations have acquired government-owned phone services. In July of 1998, almost 500,000 workers in Puerto Rico struck in an effort to stop Governor Pedro Rossello's sale of the Puerto Rico Telephone Co. to GTE Corp. of Stamford, Connecticut, for $1.75 billion. The strike began with the phone company workers and rapidly spread throughout the public sector, involving private sector workers on July 7 and 8. The administration of Gov. Rossello has launched an aggressive campaign to sell government hotels, hospitals and other assets. Colombian telephone workers also struck in June, 1998, against the privatization of the national phone company.
A complex restructuring of postal services is taking place internationally, initiated by international businesses in the transportation and package delivery industries. These companies, like UPS, TNT, and Federal Express, want access to global markets, and publicly-owned postal services are obstacles and competitors. Unions have taken the leadership in opposing privatization, and mass protests and strikes have often resulted when national governments have attempted to sell or contract a major portion of their postal or phone systems.
REFORM LEGISLATION -- ITS CORPORATE HERITAGE
The central role of transnational corporations in promoting privatization is illustrated by the career of Marvin Runyon and by the support for Rep. John McHugh's (R-N.Y.) postal reform legislation, HR 22. The Heritage Foundation and other advocates of privatization requested the appointment of "reform-minded" officials; certainly their goal was met when Postmaster General Marvin Runyon began his term in July of 1992. Consumer advocate Ralph Nader reacted to the appointment of Runyon by claiming that private contractors and consultants would like Runyon and that he had "a mind for privatization."
Runyon was expected to support both contracting of postal work and a crackdown on postal wages and union power. He came to the USPS after leaving his post as chairman of the Tennessee Valley Authority (TVA). Runyon froze power rates for corporate TVA customers, while laying off over 11,000 workers and contracting construction to private firms. Before coming to TVA, Runyon was the president of the Nissan automobile assembly plant in Smyrna, Tennessee and handed an historic defeat to the United Automobile Workers Union when they attempted to organize the plant in 1987.
Runyon and other postal officials have worked closely with Congress to restructure postal services for the benefit of contractors and large mailers. Rep. John McHugh, Chairman of the House Subcommittee on the Postal Service, has introduced and held hearings on a reform bill that unites the ideas of the think tanks, the TNCs, and top postal management. The bill contains provisions that have been advocated by Runyon, UPS, and the mailing industry over the past ten years.
Runyon began agitating for reform of the Postal Reorganization Act in 1995. He stated that postal employees were paid 30 percent more than private industry employees in comparable jobs, and objected to binding arbitration when contract negotiations failed to produce an agreement. "The problems start with collective bargaining," he told the National Press Club. Runyon complained that the Postal Service was "dragging a ball and chain" and said, "We've got a '70s law that isn't cutting it in the '90s . . . We need to fix it and fix it now." At the same time, he said the USPS had to have the ability to change prices more quickly than the public appeals before the Postal Rate Commission allowed.
The most recent version of the Postal Reform Act would cap postal rate increases to increases in the Consumer Price Index. The postal unions consider this a "wage cap," and the 1997 USPS Strategic Plan indirectly supports this claim, as it contains a chart showing that "costs per work hour drives costs and prices." The proposed legislation creates a postal employee-management commission that would alter the current collective bargaining procedures, an idea long supported by Runyon and the think tanks. The price cap, and more freedom for postal management to change rates, is supported by the Advertising Mail Marketing Association (AMMA), but opposed by the non-profit mailers. The Reform Act, while regulating increases, does not regulate the discounts that can be offered to large quantity mailers.
McHugh's bill separates the "competitive products" -- express, Priority Mail, and parcels -- from the "monopoly" product -- letter mail, and restricts the USPS from borrowing federal funds for any of these operations. It drops the competitive price restriction to $2, meaning private companies could enter any market in which the Postal Service charged more than $2 for service.
United Parcel Service supports these changes. In a December 12, 1997 letter to McHugh, UPS vice president Kenneth Churchill said, "I would like to commend you on your revision of the Postal Reform Act of 1997. On behalf of United Parcel Service, I would like to offer our assistance and cooperation as you embark on this arduous process of refining the legislation."
Another privatization proposal, by Rep. Phil Crane (R-IL), has failed to garner corporate support. Crane's introduced a bill into the 104th Congress to privatize the USPS through sale of shares to employees. Murray Comarow, an attorney who represents advertising mailers and former chair of President Johnson's Committee on Postal Organization, called the bill, HR 210, a "case study in the clash between ideology and reality," referring to the bill's lack of relationship to the needs of any significant constituency. He explained, "the postal system is too important to the nation's economy to be a laboratory experiment in employee stock ownership." Price Waterhouse's response to McHugh's questions about employee stock ownership plans said, "We are not aware of any postal administration that operates with this kind of model." Private contractors and powerful privatization advocates favor McHugh's approach as opposed to Crane's. They have a vital economic interest in securing as much of the $56 billion in postal business as possible and have no interest in promoting employee ownership by 800,000 workers.
CONCLUSIONS
While government and public institutions are supposed to balance a wide variety of interests in society, in recent years, government administrators and Congressional representatives have pushed postal policy strongly toward the interests of large advertisers, equipment manufacturers, private shipping companies and contractors. Advocates of postal privatization have little to say to postal workers, non-profit mailers or small business, but they aggressively push the interests of TNCs in communications, transportation, and mailing technology. Privatization, or large-scale contracting of the U.S. Postal Service is driven by the business priorities and political power of transnational corporations in the advertising, mailing, information technology, and electronics industries. In order to understand the political and economic processes at work, it is important to address the financial interests behind privatization. While public arguments are formed by highly ideological conservative think tanks, the backers of the rhetoric have a strong financial interest in gaining access to markets that were formally public. Arguments for privatization often center on reducing costs, but there is little evidence to support long term costs savings and much evidence contradicting this claim, as we will see below. Similarly, it is difficult to maintain that a financial or service crisis motivates postal privatization in the U.S. as the USPS has been successful by these measures.
The debate over public and private interest has a long history, and unions have been at the center of the discussion, if only because they represent workers who are profoundly affected by political decisions. Privatization of mailing and communications are global processes, and unions are finding that they face the same corporations in the mailing industry across oceans and continents. Government officials have not been hostile to private challengers but have worked with them to bring public policy in line with private priorities. In the next section, we will look at the "public interest" in the USPS and how it has been defined, governed, and represented.