Part 7

The zone system of parcels post proposes, roughly, a flat rate per pound and per additional pound within the limits of any delivery office (that is a service which involves no transfer from one post office to another) and a rate considerably heavier (but still much less than the present fourth-class mail or express rate) for delivery elsewhere in the United States. This would furnish the cross-roads store with a most convenient delivery system and furnish it at a cheaper price than its city rivals could secure it. The local retailer would have the advantage of the difference between the two charges. To give this advantage to the local retailer is probably wise from the standpoint of general public policy. The small retailer in the country does the public a very actual and very valuable service. To have a stock displayed for selection is often an assistance in purchasing; there are certain things which cannot in any case, be bought by mail; there are other things which may sometimes preferably be bought direct, just as most people like, occasionally at least, “to shop”; there is a welcome personal touch in retailing which is lost in the long distance purchase. For these and other reasons the retail store will remain, stripped of overcompetition and non-essential distributive agents, competing with the parcels post, not in price so much, as in the kind and quality of service. That is the way the small retailer in Germany had adapted himself to the parcels post; and although in his case there is no zone preferential to aid him, he has made good.

After all, there is the gist of the answer to those who oppose a parcels post on anti-centralization grounds. They speak as though there were but one factor in retailing--price. As a matter of fact there are many factors, and the best students of retailing methods consider service one of the most important. With a parcels post established the public would be getting value for its money in cheapness or service, as it chose; with the present express system it gets neither.

Congressional Record. 46: 1941-7. February 3, 1911.

Star Routes and Rural Parcels Post.

F. W. Mondell.

I do not want to put the entire blame for the hidden, circuitous, and indirect opposition to parcels post upon the express companies. There is another class of people who are opposed to parcels post who do not directly show their hands. They are the firms and corporations who send out a very large letter mail, upon which they pay 2 cents for every half ounce. The average citizen who only writes an occasional letter does not realize how heavy the burden 2-cent letter postage is to people who send out great numbers of letters.

There are many large concerns, like the mail-order houses for instance, promoters, jobbers, and dealers in special extensively advertised lines, whose actual letter postage amounts to many thousands of dollars a year. Such people naturally oppose any change in the postal service which might increase the postal deficit, even temporarily, because of their anxiety to have the letter rate reduced. The yearly income of the Post Office Department from letter postage is about $132,000,000, and it is said that some mail-order houses pay several hundred thousand dollars a year for letter postage. A reduction of that by half would be well worth working for.

It would not be fair in the discussion of this subject to overlook the fact that there are arguments against the establishment of a general parcels post which are advanced in perfect good faith and which are entitled to serious consideration. Those local merchants who have some misgivings about the matter are entitled to have their views carefully considered, but as I have indicated, it is my opinion that in the main their fears are not well founded, and arise largely from the fact that they have not had an opportunity to give the matter their personal consideration, and therefore have been inclined to accept the arguments of interested parties. There are also a considerable number of people who are honestly opposed to the parcels post in the belief that it is an unwarranted extension of government activities into a field which ought to be satisfactorily covered by private enterprise, and who still hope that the express service may be so cheapened and improved as to very largely satisfy the demand for a parcels post. There are also those who feel that owing to the vast area of our country it would be difficult to adopt a system of parcels post which would be generally satisfactory and at the same time self-supporting.

The argument is also made that the handling of a large amount of merchandise by the postal service would make delivery difficult where city delivery is provided, and delay the transmission of letters by the loading of the mails with merchandise.

These arguments do present problems which must have serious consideration. They are none of them, however, in my opinion, problems which are insurmountable, but a consideration of them, as well as of that character of powerful opposition exerted indirectly to which I have referred, leads thinking people to the conclusion that the outlook for the establishment of a general parcels post in the country in the near future is far from promising. With this as with all progressive legislation, little progress will be made until the people as a whole become thoroughly interested in the subject, quite generally make up their minds what they want, and in no uncertain tone make their wants known.

So long as only those who are opposed to the extension of the parcels post are generally heard from by members of Congress, there is not much likelihood of definite action being taken, and the probability is that in any event a general parcels post in this country can only be secured through the medium of a modest and limited and more or less experimental beginning in the way of a local or rural parcels post.

_Local Parcels Post_

President Taft in his last annual message recommended a parcels post limited to rural free-delivery lines. This recommendation was made on the ground of economy, to meet the opposition aroused by the argument that a general system would create a great deficit in the postal revenues, for a time at least. The local system would also have the virtue that it would furnish an object lesson in a partial and limited way, which might be valuable in determining the propriety of further extending the system. There is, furthermore, an argument for rural parcels post which does not apply in the same degree to a general parcels post, and that is that while the dwellers in cities and towns have ready access to stores and opportunities of express service, the dwellers in rural communities do not have these advantages, and therefore a rural parcels post which would enable them to have articles delivered on local routes or to local post offices would be of great benefit and advantage to them. As we do not have many rural free-delivery routes in our sparsely settled intermountain country, I am of the opinion that a rural parcels post, if established, should also operate over the star routes which supply our country offices and our people in boxes en route, and therefore the bill which I introduced provides for such a service.

Such a rural parcels post as is thus proposed would unquestionably be helpful in building up the trade of the merchants in the small cities and towns and of very great value and advantage to the people who get their mail at the country post offices and along country routes. This being true, I supposed I would avoid much of the storm of opposition which those who have advocated a general parcels post have heretofore encountered. Much to my surprise, however, the onslaught against this very modest proposition, intended to help the local merchant and the people of the country, has been even more terrific than the outburst against the general proposition; all of which makes one fact as clear as the noonday sun, and that is that the opponents of a parcels post realize that the local parcels post, if it works well and is generally satisfactory, will be the entering wedge for the general parcels post. It also illuminates quite as clearly another fact, and that is that the opponents of parcels post believe that the rural parcels post will work well and be generally satisfactory. Another important fact emphasized by this opposition is that the opponents of parcels post believe that the agitation for a local parcels post is much more dangerous than the agitation for the general parcels post, because it is more likely to be successful. The gentlemen who have been spending their money so liberally in opposition to the local or rural parcels post have thus made clear three important facts:

First. They believe that there is a strong probability of a local parcels post being established.

Second. They believe that such a system will work to the satisfaction of the people.

Third. They believe that, the local system having proven satisfactory, it would lead to the establishment of a general system.

In this condition of affairs it would seem that it is the duty of the friends of a parcels-post system to get behind the President’s suggestion of a local parcels post enlarged so as to include star routes and country offices.

Some one is spending a lot of money to defeat the rural parcels post. One way they are doing it is by sending out petitions by the tens of thousands, which they ask the local merchants to sign and send to their Congressman. I have received hundreds of these petitions. They have various sorts of headings printed in various kinds of type, but they are nearly all alike.

After having in the first paragraph drawn a dreadful picture of the awful disaster and destruction which the rural parcels post will bring to the farmers and to the country towns, in whose behalf they weep and wail--a destruction compared with which the devastation of Sodom and Gomorrah would be as the passing of a summer zephyr--they tell us how all these direful calamities are to come, as follows:

In every town catalogue agents of mail-order concerns would establish themselves. They would need no stores, pay no rent, employ no clerks, require no credit and give none, and carry no stock. Their whole time would be devoted to soliciting orders from catalogues. The merchandise would be shipped to them by express or freight from the retail mail-order houses in the large cities. When received it would be deposited in the local post office and the packages delivered by the rural carriers.

The only trouble with this lovely piece of sophistry is they fail to explain to us why the very game they describe can not be worked just as well now as it could after a rural parcels post had been established. There is nothing in the world to prevent just the sort of a plan, which is thus held up to our horror and execration, from being carried out now, except that it would not pay. The mail carriers on rural and star lines not only have the authority, but they would be very glad to have the opportunity of delivering packages along their routes which solicitors for catalogue houses might deliver to them. And, furthermore, they can now, no doubt would be glad to, take packages of any size; whereas a rural parcels post only provides for packages up to 11 pounds. So, when you come to analyze it, this “local-solicitor-of-the-mail-order-trust” bugaboo is found to be just another one of the strawmen, the poor miserable scarecrows, that the express companies are trying to terrify us with.

The mail-order houses claim they can sell cheaper than the local merchants because they do not have any local expense. The moment they are called upon to pay for the services of a local agent their expenses are greater than those of the local merchant. I think this disposes of the “local-agent bogy.” He is the most transparent of all the scarecrows the express companies have raised.

Congressional Record. 45: 9310-4. June 24, 1910.

General Deficiency Bill.

William S. Bennet.

Mr. Speaker: In view of the great interest in the parcels post question, I submit herewith the views of the Farmers’ National Congress:

_A Brief for a Modern Parcels Post for the United States_

[By John M. Stahl, legislative agent Farmers’ National Congress.]

It has been said, and not without justice, that because of greater density of population parcels can be carried at a less cost in the domestic mails of Germany or Belgium than in the domestic mails of the United States, because the average haul would be shorter in Germany or Belgium. But the disparity between the domestic parcels post of the United States and of foreign countries is greater than is warranted by the length of the average haul. No fact is better established in the science of transportation than that the cost of transporting an article bears little relation to the distance transported. But if the density of population should fix the rate of postage and the limit of weight in a domestic parcels post, then surely we should have a lower rate of postage and a higher weight limit than those countries in which the population is not so dense as is ours. For example, the area of the Commonwealth of Australia is 2,974,581 square miles, and the present population is 4,300,000. The area of the United States, excluding Alaska and the islands, is 3,025,600 square miles. Alaska and Hawaii would add a shade less than 600,000 square miles. The area of the Philippine Archipelago is 832,968 square miles, and the population, according to the 1908 census, is 7,835,436. It is certain that, including all our territory and all our population, we have an average population of more than 20 per square mile. Australia has a population of less than 2 per square mile. If the argument of the opponents of a modern parcels post for the United States, founded on the density of population of Belgium, Germany, etc., is a good argument, then the rate charged in our domestic parcels post should be much less and the weight limit should be much greater than in the domestic parcels post of Australia. But the postage rate in the domestic parcels post of Australia is as follows: Intrastate, 1 pound, 6 pence (12 cents); 2 pounds, 9 pence (18 cents); 3 pounds, 1 shilling; and 3 pence (6 cents) for each additional pound up to and including 11 pounds, the postage rate for an 11-pound parcel being 3 shillings (72 cents).

The interstate rate in the parcels post among the six states of Australia is as follows: One pound, 8 pence (16 cents); 2 pounds, 1 shilling 2 pence; 3 pounds, 1 shilling 8 pence; and 6 pence additional for each additional pound up to and including 11 pounds, making the charge for an 11-pound parcel 5 shillings 8 pence ($1.36).

New Zealand is 1,200 miles from Australia and extends for 1,100 miles. It has a population of only 1,000,000. Yet the rate in the parcels posts between the States of Australia and New Zealand is just the same as it is among the States of Australia, and the weight limit is the same.

Now, if the people of Belgium and Germany should have a less postage rate and a higher weight limit in their domestic parcels post than we have because the population of Germany and Belgium is denser than our population, then we should have a much less postage rate and a much higher weight limit in our domestic parcels post than have the people of Australia, because our population is more than ten times as dense as the population of Australia. But, on the contrary, the average postage rate in not only the intrastate but also in the interstate parcels post of Australia is less than in our domestic parcels post, and the weight limit is 11 pounds, as compared with 4 pounds in our domestic parcels post. The rule laid down by the opponents of a modern parcels post for the United States must apply to Australia as well as to Belgium and Germany, and by this rule the rate in our domestic parcels post should certainly be less than 8 cents a pound and the weight limit should certainly be far above 11 pounds.

The postage rate in the domestic parcels post of New Zealand is 4 pence (8 cents) for the first pound and 2 pence (4 cents) for each additional pound. The population of New Zealand is less than one-half as dense as our population. The weight limit in the domestic parcels post of New Zealand is 11 pounds. If the argument of the opponents of a modern parcels post for the United States, founded on the density of population is correct, then the rate in our domestic parcels post, instead of being several times that of New Zealand, should be less, and the weight limit, instead of being only about one-third that of New Zealand, should be greater.

Our parcels post with foreign countries shows beyond argument that the postage rate in our domestic parcels post should be not more than one-third of what it is, at the utmost, and that the weight limit should be several times what it is. The domestic parcels posts of other countries and of Australia and New Zealand show also beyond argument that the postage rate in our domestic parcels post should be only a fraction of what it is and that the weight limit should be several times greater.

Whether or not the railways are owned by the government does not touch the argument founded on the parcel post of other countries. If government ownership of railways lessens the cost of the postal service, it may be an argument that our Post-Office Department pays our railways too high a rate for transporting mail matter, but it has nothing to do with the character of the mail service our government should give our people.

As a matter of fact, government ownership of railways has no apparent effect on the parcel post of foreign countries. Both those in which the railways are in large part owned by the government and those in which the government does not own any railway mileage have a parcel post much superior to ours.

Possibly our government should not conduct a parcel post at any considerable loss, although it should be borne in mind that the object of our Post-Office Department is to serve the people and not to make money. It might be successfully argued that fundamentally there is no greater reason why the Post-Office Department should be a source of revenue than that the War Department should be a source of revenue. The mails have become so very important in the transaction of business, in the communication of intelligence, and affect so many of the operations of our daily life, that each year it becomes apparent that the test of our Post-Office Department should be the excellence of the service it gives our people; and the relation of expenditures, so long as they are judiciously and economically made, to receipts is of less and less importance. But we would not advocate any parcel post that, when fully established and on a normal basis, would add much, if any, to the net cost of our Post-Office Department. However, it is apparent from a study of the profits of our express companies that our Post-Office Department could carry parcels in our domestic post at a much less rate than 16 cents a pound without increasing the net cost of the Post-Office Department. Further, a study of the profits of our express companies show clearly that we are being charged altogether too much by these express companies for the service they give us, and that their charges should be subjected to that most effective of all control--the competition of a modern parcel post. This study shows with equal plainness that the present weight limit on parcels in our domestic post, which compels us to send by express all parcels weighing more than 4 pounds, should be raised to a much higher figure, probably 25 or even 100 pounds. Recent investigations and revelations have shown that our express companies are really subjecting us to extortion.

The competition of a modern parcels post may not prove sufficient of itself to make the charges of the express companies what they should be, but it would certainly be most effective in accomplishing this result. We are subjected to overcharges by express companies as are the people of no other country on the face of the earth. In fact, the most important countries of Europe, as well as Australia, New Zealand, etc., are not subjected to any overcharges at all by express companies for the reason that in those countries and colonies there are no express companies of the nature of those existing in this country. On account of the overcharges of our express companies we have a very good reason, indeed, for a modern parcels post in this country; and this very good reason is in addition to those that so many other countries have found amply sufficient to warrant a modern parcels post.

And it should not be forgotten that the enormous profits of our express companies on the capital they actually have invested in the express business show conclusively that our government could give us a modern parcel post without increasing the net cost of the postal service after that parcel post had been established and its business had reached normal proportions.

In an honest endeavor to arrive at a correct conclusion as to the features of our domestic parcel post we can not do better than to study the parcel post of Australia and New Zealand, for the dominant elements in the population of Australia and New Zealand are the same as in ours, the people of Australia and New Zealand have obtained their ideas of government and the functions of government from the same source that we have, their institutions and conditions approach ours nearer than those of other countries, and they have the same problem of adapting the government service to a wide expanse of territory in the settlement and development of a new country. This problem, though much greater than ours at this time--the area of Australia is nearly the same as that of our states, while the population is only about one-twentieth as much--is the same in its nature.

Another reason is that the postal service of Australia and New Zealand is so satisfactory in every way. On page 25 of “L’Union Postale” for 1909 it is stated in regard to the New Zealand postal service: “The financial results of the administration were very satisfactory. The receipts increased by 9.04 per cent and the expenditure by 7.22 per cent over the preceding year.”

It will be seen that the postal business of New Zealand conforms to the rule of good business management that as a business increases in volume the receipts should increase faster than the expense.