Privatization of the USPS: how it would have an impact on businesses, rural communities

Both presidents Donald Trump And Elon Musk expressed their interest in privatizing American postal service, an idea that has long been popular in conservative circles. Such a decision, however, could have major drawbacks.

Experts have told Business Insider that the privatization of the USPS, an independent agency older than the United States itself, could increase prices for everyone-and especially harm companies and non-profit organizations that depend on the post and rural communities that have no other shipping options.

“No one at Fedex or UPS takes care of the public interest,” said Business Insider James O’Rourke, who teaches management and organization at the University of Notre Dame and studies the USPS. “They take care of shareholders.”

In December, Trump said that he “considered” “to privatize the agency. And at the end of February, he suggested placing the USPS under the control of the trade department.

The USPS has rarely been profitable. He recently reported his profitable first quarter since 2022, but his total loss for the financial year ending in September was $ 9.5 billion, an increase of $ 3 billion compared to his loss the previous year.

The agency’s financial misfortunes led the general post general at the time, Louis Dejoy – who left his role last week – in mid -March to undertake to work with Doge to make the agency more efficient, in particular the reduction of 10,000 jobs and the elimination of billions of dollars on the budget.

Higher prices, a service reduced to some

If the USPS was privatized, it is not clear that existing laws regulating the agency, as a mandate six days of service and the universal service, would remain in force.

If a private company took control of the USPS operations and these laws had been thrown out of the window, it would probably increase prices, reduce the speed and frequency of delivery, eliminate service to all addresses and close some of the 30,000 USPS offices across the country, said Michael Plunkett, CEO of the Postal Commerce association, which represents the companies in the post and shipping industry.

Some communities would feel “almost” more “more pain than others, said Plunkett.

“There are rural communities that would probably suffer if the postal service was significantly changed, especially in the short term,” said Plunkett. And it is because “there is no other operator in many small and far from cities in the United States. This is why the postal service makes a delivery of the last mile for other companies in these places.”

O’Rourke said that even if the agency was not as popular as it was, it should always be treated as an essential public service.

“What concerns me most is that we become two nations: the wealthy and do not have,” he told Bi. “And the gap between the two widens and the available services are no longer available for those who need it as much as the others.”

Important reforms would also harm non -profit organizations and businesses

The non -profit world is still based strongly on the post office for its fundraising efforts, said Robert Tigner, a lawyer for non -profit alliance, an association which represents and defends non -profit organizations.

If the USPs were privatized and updated the non -profit rates removed, there would be a devastating impact on organizations, said Tigner.

“No one – Even a large organization has not six or seven million additional people hanging out in order to continue what it does today,” said Tigner. “This would paralyze the current environment to collect funds by mail.”

It is not only non -profit organizations that would take a higher price. Any company that is based on the mail for advertising would also suffer, said Plunkett.

“Any major change in the operation of the postal service would be sufficiently disruptive for certain non -profit companies and organizations to make their doors,” Plunkett told BI.

However, some say that privatization has its advantages

The United States would not be the first to privatize or reduce its messaging service-the United Kingdom, Germany and the Netherlands have privatized their post offices, and the postal service managed by Denmark recently announced that it would stop providing letters.

Chris Edwards, an economist at the Cato Institute, said the United States should follow the example given by European countries.

“We don’t need another government agency that adds to our government debt,” said Edwards.

He said that any compromise in the congress that would pay a private company to cover the supply of universal services at each address in the United States would always be cheaper than the government fully managing the USPS.

Edwards called a possible merger with the trade department “a very stupid idea”. The congress, he said, “micro-management” of the agency, and if you add the secretary to trade and the president to this equation, this would make him even more bureaucratic than it is already.

Plunkett and O’Rourke agree with Edwards on one thing: putting USP in the trade department would give Trump greater authority on the agency’s direct operations.

Any Trump’s effort to dismiss the Governors’ Council of the USPS and take control of the agency would be illegal, argued the president of the Syndicate of American Postal Workers, Mark Dimondstein, in a statement last week. But, as we have seen with USAID, this does not mean that the president cannot yet do it.

THE National Association of Transporters of LettersTHE American Union of Postal Workersand the National Association for Transport of Rural Letters organized demonstrations across the country during last week to protest against the cuts and a potential dismantling of the USPS.

The White House did not respond to a request for comments on Trump’s current plans for the agency.