Brought to you by:


Learn More about My Virtual StrongBox - Click Here


Our Blog Roll

The Financial Brand
Snarketing 2.0
The Filene Blogs
CreditUnions.com
CU Water Cooler
CU Insight
The Members Group

Resources

Meet the Moderator
Keep It Clean
About Guest Authors

1 posts categorized "Postage"

October 09, 2013

Stamps for $1? Sure, I'm In.

ShareThis

by Ron Daly

What can you really buy for a dollar these days?

I did an informal survey (which is to say, I looked at the prices of a few things I buy from day to day), and you'd be surprised how far a dollar goes...or doesn't go.

I can buy: 

  • A can of soda, or
  • A trip down the express lanes from my home to my office, or
  • A copy of the paper, or
  • An older song on iTunes (the newer ones are more than a buck), or
  • Something from the dollar menu at McDonald's, assuming I can scrounge up a dime for the taxes.

There aren't a lot of things that cost one thin dollar. There are even fewer things that cost under a dollar. Everything's "99¢", the biggest double-whammy ever pulled in advertising. "Hey, it's pennies a day!" Yes, 99 of them.

I rarely suggest that things that are cheaper than a dollar should cost a dollar, but do you want to know one thing I think is worth a buck? A postage stamp.

Think about it. What should it cost to send a letter or a card or even a small package all the way across the country, or around the corner? If you wanted to send that stuff privately (via UPS or FedEx), it would cost more than a dollar. The Post Office does a good job of moving thousands of millions of letters and bills and papers and packages all over the country. But they're hurting and they've lost quite a bit of money in the past few years (all well documented here). They want to increase stamp prices again, to $0.49, a move that has some businesses and "concerned citizens" up in arms. "Outrageous!" they cry. "Stamps need to be affordable!" 

Don't argue that to Rick Newman. He says stamps should cost $1 each. His reasoning:

So hiking the price of a stamp to $1 seems like a straightforward way to align the agency’s costs with its expenses and save Congress the trouble of turning out a few members every now and then to listen to the Postal Service’s familiar tale of woe. The Postal Service says a mere three-cent hike in the cost of a stamp will raise $2 billion per year, so going all the way up to a buck ought to raise many billions more, even accounting for the decline in mail volume that's been occurring, plus the dropoff in sales that usually comes with higher prices. All told, those extra billions ought to more than cover the huge annual losses now expected.

If there’s concern about fixed-income seniors or other customers who might not be able to afford a dollar for every letter they mail, Congress could make postage costs tax deductible for heavy mailers below a certain income threshold, which would let the USPS off the hook and make the whole thing Congress's problem.

Postage increases fixing income troubles? Less mail? Blaming Congress? I'm in!

A dollar's not a lot of money, sadly. It doesn't buy a lot. But going back to my original question: how much would you pay for a person to hand-deliver a letter to your home? A dollar's a great value, honestly. And when it comes to serious mailers, one of two things will happen: 

  1. People who relied on the mail will start to move toward electronic payment and delivery methods, which is good for the environment and for business.
  2. The people who insist on sending paper mail (and especially those pesky junk mailers) will pay through the nose to keep it going.

What do you think? Would you pay $1 to mail a letter? Let us know about it in the comment section.