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Don't go postal

| Sunday, Aug. 16, 2009

President Obama couldn't have been more right: The post office is struggling, and for good reason.

While defending his government-funded health insurance option -- which would, many argue, put private insurers out of business and pave the way to a single-payer system -- he said private companies ought not fear the government.

He said it is the U.S. Postal Service, not FedEx and UPS, that is struggling.

You have to feel bad for the folks who run our postal system. The quasi-government operation is on track to lose $7 billion this year.

In the Internet era, you see, fewer people are mailing things. They're mailing even less during a deep recession.

But here's the real challenge our post office faces: Weighted down by regulations, mandates and bureaucratic inertia, it isn't much good at adjusting to changing market conditions.

Postmaster General John Potter is trying to change that. He said Congress needs to allow the post office to "think outside the mailbox" -- to consider new activities that could generate new revenue.

The Australian postal system allows customers to renew their driver's licenses. The Italian post office allows customers to do their banking. Post offices in other countries allow customers to purchase insurance.

Our postal system has 36,000 locations across America -- it generates massive foot traffic. Surely, it could generate lots of new dough by offering lots of additional services and products that consumers want.

But, since quasi-government organizations move at a snail's pace, if at all, that may take a while.

If you want an example of someone who really did think outside the mailbox, you'd have to go back to 1971.

A fellow named Fred Smith wanted to do something the post office wasn't able to do: deliver small packages fast.

He wrote a term paper on the subject as a college student. He later invested money he inherited -- along with venture capital he was able to raise -- to buy a used-aircraft company in Little Rock, Ark.

He began using the aircraft to provide overnight delivery services for envelopes and small packages shipped within the United States.

He ran into all kinds of challenges and obstacles. He and his team worked hard to resolve them. They pushed advances in computer technology to drive efficiency. Their creativity and innovation ultimately changed the world.

The company Smith founded is now known as FedEx. Needless to say, FedEx has become so innovative and efficient, we take for granted that the package we drop off today will arrive virtually anywhere in America by noon tomorrow.

To be sure, so reliable is FedEx, our postal system signed a contract with the company to deliver its own express packages all over America -- something the post office could never do on its own.

Which brings us back to Obama's telling comment. It unwittingly shed light on what the health care debate is all about.

It is true that our health care system needs some reforming and our government has an important role in driving reform.

But do we really want "reforms" that will lead to a post office-style bureaucracy and the constant meddling of big-talking politicians?

In the era of Google and innovation and new efficiencies, do we really want a government-directed system that, by its very nature, will quell innovation and efficiency of every kind?

Or do we want reform that will move us more toward the energetic FedEx model?

Most agree that lawmakers must address the big challenges -- there are creative ways to deal with portability, pre-existing conditions, the uninsured, etc. -- but they must do so without inhibiting individual freedom.

Freedom is the only hope of unleashing the creativity and innovation that will drive the efficiencies our health care system so badly needs.

Is there anyone on the planet who thinks the government can manage one-seventh of the U.S. economy better than the private sector?

If you do, let me ask you this: If you needed to ship a precious personal item halfway across the world, whom would you entrust it to?

The post office or FedEx?

The health care debate is no more complicated than that.

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