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Saturday, July 15, 2017

Why the Post Office Gives Amazon Special Delivery

A Citigroup analysis finds each box gets a $1.46 subsidy. It’s like a gift card from Uncle Sam.

In my neighborhood, I frequently walk past “shop local” signs in the windows of struggling stores. Yet I don’t feel guilty ordering most of my family’s household goods on Amazon. In a world of fair competition, there will be winners and losers.

But when a mail truck pulls up filled to the top with Amazon boxes for my neighbors and me, I do feel some guilt. Like many close observers of the shipping business, I know a secret about the federal government’s relationship with Amazon: The U.S. Postal Service delivers the company’s boxes well below its own costs. Like an accelerant added to a fire, this subsidy is speeding up the collapse of traditional retailers in the U.S. and providing an unfair advantage for Amazon.

More here

4 comments:

Anonymous said...

And continues the postal service crying for government bailouts for the last four decades. Ehobruns a business like this and is able to keep their doors open

Anonymous said...

Bezos need the money for WaPo

Anonymous said...

"It’s like a gift card from Uncle Sam."

No, it's like a gift card from every taxpayer in the U.S.

Anonymous said...

Postal service can't even come close to fed-ex ground. I can order supplies from chewy.com and have it NO later than 36 hours later. The postal service pays fed-ex for the use of their airplanes. At one point they had total control of letter-magazine,parcel,and overnight services. Instead of buying all the necessary equipment to sustain growth into the future what have they continued to do? They have for decades given out substantial bonuses to mid-upoer level Mngmt