You are browsing the archive for 2019 June 08.

Avatar of admin

by admin

The U.S. Postal Service Is Dying. Here Is How We Can Save It.

June 8, 2019 in Economics

By Chris Edwards

Chris Edwards

Mail volumes are falling and the U.S. Postal Service is losing
billions of dollars a year while accumulating large
liabilities.

The USPS has partly offset declining mail revenues with growth
in package revenues. But the company’s finances look pretty bleak
overall.

The table below illustrates the USPS’s predicament with data
from 2009 and 2018 from here, here, and here.

!function(e,t,s,i){var n=”InfogramEmbeds”,o=e.getElementsByTagName(“script”)[0],d=/^http:/.test(e.location)?”http:”:”https:”;if(/^/{2}/.test(i)&&(i=d+i),window[n]&&window[n].initialized)window[n].process&&window[n].process();else if(!e.getElementById(s)){var r=e.createElement(“script”);r.async=1,r.id=s,r.src=i,o.parentNode.insertBefore(r,o)}}(document,0,”infogram-async”,”https://e.infogram.com/js/dist/embed-loader-min.js”);

The data in the table reflects that:

- Mail demand is falling and package demand is rising. The
problem is that mail is more profitable and accounts for most of
USPS revenues.

- USPS management has cut costs where it can, such as by
reducing the worker count. But Congress resists other cost savings
such as closing post offices, even though the number of retail
customers is falling.

The USPS should be
privatized and postal markets opened to competition.

- Marketing mail has become by far the largest type of mail by
volume. Thus we have a vast fleet of trucks driving around the
country, burning gas and creating pollution, and the main thing
being delivered is junk mail.

- More than three-quarters of USPS costs are employee
compensation, which includes excessive health and pension benefits.
About four-fifths of the USPS labor force is unionized.

- USPS has been losing money for more than a decade. Expenses
are a few billion a year higher than revenues.

- USPS assets are falling and liabilities are soaring. The
largest liabilities are unfunded retiree health benefits, worker
compensation costs, and debt.

What’s the solution? I testified to
Congress
that the USPS should be privatized and postal markets
opened to competition. Those reforms would give the USPS the
flexibility it needs to cut costs, diversify, and innovate, while
creating equal tax and regulatory treatment of businesses across
postal and package markets.

Chris
Edwards
is an economist at the Cato Institute. He recently
testified before the House Oversight and Reform Committee about the
USPS’s dire financial condition. …read more

Source: OP-EDS

Avatar of admin

by admin

Forget the U.S.-China Trade War: Is a Conflict Over Taiwan the Real Threat?

June 8, 2019 in Economics

By Ted Galen Carpenter

Ted Galen Carpenter

Tensions between Taiwan and the People’s Republic of China
(PRC) are surging to an alarming extent. The latest indicator is
the recent exchange of heated rhetoric between Gen. Wei Fenghe,
China’s Minister of National Defense, and Taiwan’s
Mainland Affairs Council, the Taiwanese government’s chief
policymaking body dealing with cross-strait relations. As
Taiwan’s self-proclaimed protector, Washington should be
extremely worried about these developments.

Speaking on June 1 at the Shangri-La Dialogue, an annual
multilateral conference on Pacific security issues, Wei warned
against efforts either in Taiwan or foreign countries to thwart
China’s goal of reunification. Moreover, “any
underestimation of the PLA’s resolve and will is extremely
dangerous.” Wei added ominously that, “If anyone dares
to split Taiwan from China, the Chinese military will have no
choice but to fight at all costs, at all costs, (sic.) for national
unity. If the PLA cannot even safeguard the unity of our
motherland, what do we need it for?”

U.S. leaders and the
American people need to ask themselves whether they are really
willing to risk war with a nuclear-armed power to protect
Taiwan.

The Mainland Affairs Council responded with equally harsh and
uncompromising language. In a statement issued the following day, the council
reasserted that Taiwan has never been a part of the PRC and would
never accept Beijing’s control or threats. It accused China
not only of “challenging international norms and
order,” but added the gratuitous slap that Beijing’s
claim to seek peaceful development was “a lie of the
ages.” Lest anyone not fully grasp the extent of
Taipei’s hostility toward the PRC, the statement went on:
“We need to remind the public that the Chinese Communist
Party is practicing anti-democracy, anti-peace between the two
sides of the strait and further resorting to war. This is the main
cause of the tension in the Taiwan Strait and the region, and it is
the source of danger and provocation against peace and
stability.”

The vitriolic exchange constituted a worrisome escalation of the
animosity between Taipei and Beijing that has been roiling for the
past three years. The victory of the pro-independence Democratic
Progressive Party (DPP) in Taiwan’s 2016 elections dashed any hopes
Chinese leaders had that the burgeoning economic ties with the
mainland would translate gradually into increased Taiwanese popular
support for political reunification. Anger at that strategy’s
failure led Beijing to revive a campaign to increase Taiwan’s
diplomatic isolation by poaching the few small nations that still
maintain formal relations with Taipei. The PRC’s menacing military
activities also increased. Chinese war games in and around the
Taiwan Strait have soared since 2016. The U.S. Defense Intelligence
Agency’s 2019 report …read more

Source: OP-EDS