The Postal Monopoly; B. Summers

162 ation, frustrated by the quality of postal service between their Den ver headquarters and their plant in Pueblo, hired an armored-car service to deliver the mail. After five months of operation the ser vice was halted by the Denver Post Office, and "at the Post Office's suggestion" CF&I paid two thou sand dollars toward back postage. 3 These are examples of a monop oly at work. With a few minor ex ceptions, the United States Postal Service enjoys a legal monopoly in the delivery of letters. Under the Private Express Statutes, private letter carriers are subject to fines and/or imprisonment. Why should the U.S.P .S. hold a 3 Wall Street Journal, June 5, 1967.

1976 THE POSTAL MONOPOLY 163 legal monopoly? And, more to the point, why should the government be carrying mail at all? Let us examine some of the arguments put forward by defend ers of the monopoly. One argument is that the U.S.P.S. constitutes a "natural" monopoly. That is, it is contended, it would be impossible for competing private firms to pro vide efficient service. Thus, it is argued, we need a government-run monopoly. This a.rgument does not stand up in the light of history. In the past three hundred years, thou sands of private carriers have pro vided efficient postal service in England and America. Three such private carriers stand out in British history: Wil liam Dockwra, Charles Pavey, and Peter Williamson. 4 Each of these men was so efficient in providing postal service that the British General Post Office, after closing them down, adopted many of their methods. William Dockwra established his London Penny Post in April 1680. Within a few months he had four hundred post offices, and was making ten daily deliveries and four to twelve daily collec tions. Thus, it was possible to send a letter and receive an an4 Rockford Fresnel, "Postmen Against the State," Innovator, June 1966.

swer the same day. The 1946 edi tion of the Encyclopedia Britan nica reports: The staff employed in London by Dockwra considerably exceeded that employed by the post office in the whole kingdom. This truly remark able enterprise gave London a postal service which in some respects has never been equalled before or since. For some time Dockwra struggled with serious financial difficulties; but no sooner had the penny post begun to show a profit than the duke of York, on whom the post office rev enues were settled, asserted his mon opoly. Dockwra was condemned to pay damages and his undertaking was incorporated in the General Post Office; but the London penny post long survived its creator and was maintained until 1801. Charles Povey founded his Half Penny Carriage in October 1709, serving parts of London, West minster, and the borough of South wark. His rates were less than the General Post Office. After seven months of operation he was fined and put out of business.

Peter Williamson established his Edinburgh Penny Post in 1776. He was so successful that his wife and father-in-law soon set up a competing penny post. After sev enteen years his business was taken over by the General Post Office. Following the lead of these three men, private penny posts 164 THE FREEMAN March sprung up all over the British Isles. According to one source, by 1800 there were over two thou sand. 5 Today, due to the vigorous enforcement of the British postal monopoly, there are none. 'The American story is much the same. In the 19th century hundreds of private carriers suc cessfully competed with the Post Office Department. Due to the en forcement of the Private Express Statutes, none have survived. One of the earliest of these pos tal services was begun in 1835 by William F. Harnden of Boston. His success encouraged competi tion, and by 1843 Boston alone had at least twenty private postal operators, including Alvin Adams, father of the Adams Express Company.

Soon private post offices dotted the land. There were Hussey's Post and Boyd's City Express in New York City; Pomeroy's Letter Express in eastern New York State; the Letter Express Com pany in western New York State, Chicago, and Detroit; Hale and Company in New York, New Eng land, Philadelphia, and Baltimore; Lysander Sp"ooner's American Let ter Mail Company; Blood's New York Express (four deliveries and five collections daily); Wells and ;) Fresnel, Ibid. Company (la tel'" to become Wells Fargo) ; Yankee Jim's Loon Cr~ek Express; Randall and Jones Can yon City Express - one stamp cat alogue lists one hundred fifty pri vate carriers. In 1845 private car riers transported an estimated one-third of the nation's letters. 6 How efficient were the private carriers? Hunt's Merchant Maga zine reported: "Government en terprise is wholly unable, under its most advantageous promptings, to compare with private enter prise."7 Albert D. Richardson wrote that Wells-Fargo Express operations in the West "illustrate the superiority of private enter prise. Whenever the messengers run on the very steamer, or the same railway· carriage, with those of the United States mail, three fourths of the businessmen en trust them with their letters, which are invariably delivered in advance of government consign ments .... "8 Of course, these developments were noted in Washington. In 1844 Senator James F. Simmons of Rhode Island declared: "The fact is notorious that, . . . on the ex press routes, twenty letters are (j William C. Wooldridge, Uncle Sam, The Monopoly Man (Arlington House, New Rochelle, N.Y. 1970) pp. 11-31.

7 Frank Chodorov, The Myth of the Post Office (Regnery, Hinsdale, Ill., 1948) p. 14. 8 Wooldridge, p. 21.

1976 THE POSTAL MONOPOLY 165 sent outside the mail for the one that is carried by the mail."9 That same year Congressman John P. Hale of New Hampshire warned: "events are in progress of fatal tendency to the Post Office Depart ment; and its decay has com menced."lO The Philadelphia post master predicted that if the pri vate earriers "be not put down, they will ere long put down the Post Office Department."ll Unable to match the efficiency of the private carriers, the Post Office resorted to force. The Pri vate Express Statutes were strengthened in 1845. William C. Wooldridge reports: With a realistic appreciation of the underlying difficulties, the Senate Post Office Committee brought in a bill that would con1bine a drastic re duction in postage rates with stiffer restraints on private competition. Even then, however, the bill's sponsor recognized the government's congeni tal inability to compete successfully with the private expresses; he begged his colleagues "to keep in mind, what he had so repeatedly urged, that it was not by competition but by penal enactment" the private posts were to be destroyed. u Those private carriers that !) George L. Priest, "The History of the Postal Monopoly in the United States,"

Journal of Law & Econornics, April 1975, p.59. ]0 Priest, p. 61. 11 Wooldridge, p. 22. 12 Wooldridge, p. 23. weren't frightened from the mar ket were put out of business by criminal prosecution. The govern ment's postal monopoly was pre served, not by providing better service than the private carriers, but by threatening them with arrest. There is nothing "natural" about the postal monopoly. If the monopoly were "natural," the gov ernment wouldn't have to crush competi tion wi th threats and criminal indictments. A second argument used by the monopolists is that pri vate car riers wouldn't charge uniform rates. They would charge less for low-¥ost routes (such as across town) than for high-cost routes (such as across the continent). That sounds like a pretty fair system. People would pay for what they got. What we have now is across-town mailers being plun dered to subsidize across-continent mailers. What is so noble about that?

And we should remember the words of Hunt's Merchant Maga zine: "Government enterprise is wholly unable, under its most ad vantageous promptings, to com pare with private enterprise." Given a few years of free enter prise, all postage rates would prob ably be lower than they are now, including those now subsidized by 166 THE FREEMAN March the taxpayers. Of course, we will never know as long the U.S.P.S. has a monopoly. A third argument used by the monopolists is that private letters wouldn't be safe in the hands of private carriers. Private carriers might open the mail and read it. This is precisely what the pos tal monopoly has been doing for years: For 20 years the CIA routinely opened over 13,000 letters a year going to and from the U.S.S.R., and later extended this operation to in cludemail from North Vietnam, Cuba, and other (noncommunist) Latin American countries. Chief Postal Inspector William Cotter sys tematically lied about the existence of this operation until just this year.

Military counterintelligence groups routinely opened military mail, both within the U.S. and at overseas bases. The "flap and seal" operation was justified on the grounds of detecting spies, but according to columnist Jack Anderson, was used largely to spy on servicemen who had complained about the Vietnam War. The Sources of Invention In just the past two years, Inspec tor Cotter admits there have been 431 court orders for opening first class mail, and nearly 8600 approved mail covers [the recording of all return addresses on someone's incoming mail]. The latter have been at the behest of 41 Federal agencies, includ ing the IRS, the Drug Enforcement Agency, the Interstate Commerce Commission, and the Departments of Agriculture and Interior, as well as state and local police and prosecu tors.l 3 On July 13, 1855 the editor of Alta California, enraged by the prosecution of private carriers, declared: "The present Post Of fice system is the most outrageous tyranny ever imposed on a free people. It forbids us from send ing letters by such means of con veyance as we may prefer, without paying an odious and onerous tax to the government .... "14 Strong words. And still true. ~ 13 Robert Poole, Jr., "Getting Big Brother Out of the Mailbox," Reason November 1975, p. 54.

14 Wooldridge, p. 31. IDEAS ON L$ LIBERTY As CONTRASTED with the ideal ways of organizing effort in other fields, what is needed for maximizing the flow of ideas is plenty of overlapping, healthy duplication of efforts, lots of the so-called wastes of competition, and all the vigorous untidiness so foreign to the planners who like to be sure of the future. JOHN JEWKES WILLIAM CHADWICK I I HAVE LONG BEEN PUZZLED by the way my American History teach ers,and the textbooks they used, presented the Abolitionists - the men and women of the American antislavery movement - in a very friendly light. Now, most of these teachers were quite openly of the Left. It always struck me a bit odd that they who admired Chair man Mao should sing the praises of such ardent individualists as Thoreau. Their logic seemed to be: (a) the slaves were Negroes, (b) the Abolitionists were helping the slaves, (c) the Left helps Negroes through the "Civil Rights" move ment and Welfare-State programs; therefore, (d) the Abolitionists were of the Left. 1 Yet I, as a libMr. Chadwick is a freelance writer living in New York City.