Is the Postal Service a private company or a government agency?
It spends money on advertising in national media and competes head-to-head with companies like the United Parcel Service and Federal Express. It sponsors sporting events just like major corporations.
It also recently changed its address on the Internet to www.usps.com (instead of usps.gov), just like a private company. In fact, if an internet surfer types in www.usps.gov, it automatically takes the user to the new private sector address.)
But while the Postal Service acts and goes to considerable lengths to create the appearance of a private company, it actually switches back to being a government agency when it is financially advantageous to do so.
While Congress hopes it is financially independent, it occasionally gets appropriations from Congress when the money it spends on advertising doesn’t provide enough revenue or take enough market share from its private sector competitors.
It also has a monopoly on first class mail service. And now, according to the US Court of Appeals for the Ninth Circuit, the Postal Service cannot be sued like a private company for antitrust violations.
In a case involving a company called Flamingo Industries, which makes mail sacks, Flamingo alleged that the Postal Service was attempting to create a monoply in mail sack production when USPS terminated its contract with the company.
The court ruled that the Postal Service was not subject to allegations of antitrust violations because “The Postal Service is not subject to antitrust liability. In both form and function, it is not a separate antitrust person from the United States but is part of the Government, and so is not controlled by the antitrust laws.” (No. 02-1290. Argued December 1, 2003–Decided February 25, 2004)
So now we know. Those glitzy ads you see from the Postal Service bringing us a free sporting event aren’t from a private company responsible to its shareholders if it has a financial loss but are actually from a government agency (that looks and sounds like a private company) backed by the power, money and privileges of a government agency.
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