Part 8

In the last published report of the postmaster-general of New Zealand it is pointed out that notwithstanding several important reductions in the postage rate the revenue of the postal service had during the preceding sixteen years increased by a considerably larger amount than the expense. “From December 16, 1907, the postage on inland post cards was reduced to one-half penny. From January 1, 1908, the rates for inland letters were made 1 penny for the first 4 ounces and one-half penny for each additional 2 ounces. From January 1, 1908, the commission chargeable on money orders within New Zealand is 3 pence for each 5 pounds sterling or fraction of 5 pounds. Owing to the reduction in postal rates made the year before, the number of parcels increased 81.57 per cent.” “The rate of postage for inland parcels was reduced from 6 pence for the first pound and 3 pence for each additional pound to 4 pence for the first pound and 2 pence for each additional pound. The public, moreover, has by the change been induced to send by parcels post articles which were previously forwarded as packets.” “The reduction in postal rates may be practically referred to as having resulted in a great increase in parcels-post business.” There was a handsome net balance to the credit of the postal business. “The net balance on the year’s transactions would be much higher if the value of official correspondence dealt with were taken into account.” “The expansion of the business has necessitated large additions to the staff. The increase of the staff was, however, below the percentage of increase of the receipts. An amendment to the post-office act contributed to improve the financial condition of the postal service.” The experience of New Zealand and the Commonwealth of Australia in postal service is well stated by the colonial treasurer, Hon. Sir J. G. Ward, in one of his recent financial statements, as follows: “Experience has shown that every concession in postal rates creates a new class of business which is ultimately to the profit of the post-office.”

Of course, in the official publications of the Commonwealth of Australia and of New Zealand one hears nothing to the effect that the government should not engage in any competitive business--one hears that only in the United States. If that were put into effect, our national government would be compelled to stop building war ships in the navy-yards, to close up altogether the government printing establishment, to stop at once all its irrigation projects, to close up all the land-grant colleges, to stop at once casting cannon and making small firearms and ammunition, etc. As a matter of fact, when our Constitution was framed there was no question among those that framed it that it should give to the national government the power to do certain things, in competition with private enterprise, that would be for “the public welfare;” and there was never any intimation that the national government should not engage in any competitive business. On the other hand, those that helped to frame the national Constitution and to secure its adoption participated in and sanctioned legislation by Congress that put the national government into several lines of competitive business.

The publications of the labor officials of Australia and New Zealand are decidedly numerous, and show plainly that the working people of these colonies, as well as the other elements of their population, are heartily in favor of a modern parcel post. It may truly be said that the parcel post of Australia and New Zealand has the hearty and universal approval of the people of those colonies. The officials and the rank and file of the labor organizations of these colonies are among the heartiest supporters of their parcel post. And it is certain that the very large majority of the rank and file of our labor organizations and the very large majority of our city people, as well as of farmers, heartily favor a modern parcel post.

As for the relation of a modern parcels post to the so-called catalogue houses: In his official reports the postmaster-general of both Australia and New Zealand frequently emphasizes that for years a thoroughly modern colonial, intercolonial, and foreign parcels post has been enjoyed by the people of those colonies, even in “the most remote districts to which the mail service penetrates.” Notwithstanding this, in all of the many publications on Australia and New Zealand, or by the officials of those colonies, there could not be found a sentence to the effect that the local merchants of those colonies have been in the least injured in their business by catalogue houses.

This fact certainly merits being emphasized. In all the countries in which there is a modern parcels post the catalogue house is unknown. In our country, which is the only enlightened country that has not a modern parcels post, the catalogue house exists and, to some limited extent, flourishes. Hence the fact is plain that instead of a modern parcels post aiding catalogue houses the very opposite is true. If the universal experience of humanity counts for anything, then the antiquated parcels post, such as we have, aids the catalogue house and the modern parcels post puts it out of business and keeps it out of business.

The rural delivery service has grown to more than 20,000 routes. Official reports show that the average weight of mail delivered by each team or single-horse wagon in the rural delivery service is only 25 pounds. On nearly all the trips the carrier could practically as well take 500 pounds in his wagon. The more than 40,000 rural carriers make more than 12,480,000 round trips each year. If a parcels post on the rural routes earned $2 for each round trip the gain would be, in round numbers $25,000,000 a year, and this, with some little reforms that all agree should be and easily could be made, would wipe out the postal deficit. Now, if the rate on the pound packages in a rural route parcels post was 5 cents a pound the carrier to earn the $2 per round trip would be compelled to carry not the 500 pounds that he could, but only 20 pounds additional going and coming or a total load of only 45 pounds.

This is a fair calculation as to profit to the government, for the expense for the rural carrier service would not be any greater whatever, and the small expense for handling the additional 20 pounds at the terminal post-office would be more than covered by the increased first-class mail (handling which is very profitable) resulting from the parcels post.

As, on the average, about 100 families are served by each rural route, if, on the average, each family had delivered or sent each trip only one-half pound of parcel, taking into account that a good many parcels would weigh less than 1 pound and that every parcels-post bill proposes for them a higher rate than for heavier packages, the rate could be made much less than is proposed and yet the postal deficit would be wiped out altogether!

And this would be of very great benefit to the 4,000,000 families served by the rural mail delivery. The rural carrier passes the farm every week day, yet if the farmer wants a package from the town he must go after it--each of the 100 farmers must hitch up and drive to town and back for packages that the one carrier could have brought them as well as not with the outfit that he already has. Or these 100 farmers must hitch up and take to town packages that the carrier could have taken for them with the outfit he already has. The time and labor saved the 4,000,000 families on rural routes would amount to many times the present postal deficit.

It is only natural that farmers should be especially desirous of a modern parcels post, because, as already stated, the express service stops with the railway station. Hence the farmer has no express service that reaches to him as have the people of towns and cities. The express companies have never cared to carry their business to the farmer, and this must convict them of only the most reprehensible motives in opposing a parcels post limited to rural routes, which would extend the equivalent of an express service to the farmers. As bearing on the farmer’s need of a modern parcels post, the following from a letter just received from Hon. W. L. Ames, Oregon, Wis., a practical farmer and a leader of national reputation in all agricultural movements, is of interest:

“One of the things we most need is better and prompter transportation facilities for rather small articles. I recently needed a small but important repair for a machine. It weighed 4¼ pounds. It cost 55 cents. The express company charged 45 cents to bring it to Oregon--200 miles. The charge was altogether too high, but what I felt most disposed to complain about was that it took a week to bring the repair to me. Mail matter moves promptly; but the express company knew that it was certain of the job of carrying that repair to me, hence no need of haste on the part of the express company. We need better and added facilities for the prompter moving of such merchandise. Present delay is a serious handicap, and undoubtedly a parcels post would give us prompt service at a less rate, as it would not be expected that the parcels post would do more than make a moderate profit for the government, whereas the express business is a constant ‘melon-cutting’ business. We must not forget, also, that all the equipment for a parcels post on rural routes is already installed.

“If the government would take charge of what it already has and add rules to fix charges for carrying parcels on the rural routes, it would relieve us of much unjust charge and also much annoyance and loss of time. Under the rulings of the Post-Office Department prohibiting rural carriers from acting as agents for anyone to obtain business, carriers are afraid to carry parcels to any extent. But what cuts a yet greater figure is that no rule can be established to fix the charges for carrying parcels and make them the same for all. Each person on a rural route and the carrier cannot dicker for the transportation of each article. That would soon lead to great dissatisfaction, as some would think that others were being favored. And to dicker on each parcel would take so much time and be so much trouble that the carrier could not be expected to do it. All we need to put into effect a modern parcels post on the rural routes is a law fixing a reasonable and proper rate for the transportation of parcels and making it the business of the rural carrier to handle parcels as well as the mail matter he now carries.”

Cosmopolitan. 36: 497*-9*. March, 1904.

Who Will Be Benefited by a Parcels Post?

John B. Walker.

Those who have been appointed to defend the Post-Office Department in the sacrifice it has made of the American people in the matter of postal parcels delivery have replied to the argument in the last issue of _The Cosmopolitan_ by claiming that but very few people will be benefited by a parcels delivery equal to that of Germany. It is therefore necessary to consider this question: “Who are the people who will be benefited?”

First. There will be a gross saving amounting to more than two hundred and fifty millions of dollars per annum. This annual addition to our national wealth constitutes an economic factor of the highest importance.

Second. While this sum will be distributed equally among the people in proportion to their purchases--especially among those who make small purchases--the direct benefit will be first appreciable in the business of the following classes:

I. _The Small Storekeepers of the Country Towns and Villages._ One of the arguments used by those who have been placed in the Post-Office Department for the protection of special interests, is that a parcels post would injure the country storekeeper. The very slightest consideration of the problem, however, would have shown that no one is so likely to be its beneficiary as he. The chief difficulties with which the small merchant has to contend are these:

1. Insufficient capital.

2. Distance from wholesale centers.

3. Cost of expressage on small parcels.

The country merchant has the acquaintance of his customers; he knows their wants and enjoys their good-will, and would have their patronage if he could be placed in a situation where he could give them equal, or approximately equal, advantages with a merchant who buys on a large scale. If one of his customers is driven to go elsewhere, it is not only because the merchant cannot afford to keep in stock the particular class of goods desired, but because he cannot afford to ship these goods in small quantities, on account of the prohibitive rates of the government’s postal parcels charges of sixteen cents per pound, or the almost equally prohibitive rates of the express companies.

The country storekeeper has the experience of his customer’s wants, and he has a knowledge of the best goods, knows what is a fair price for an article. He is in a position to advise his customer as to his needs, and if he were not handicapped by lack of capital and cost of transportation for parcels, he could, in nine times out of ten, supply the wants of the customer.

In addition to the trade he has now, the country storekeeper would, with the advantage of a first-class postal parcels system, be able to keep in touch with all the great wholesale distributing agencies of the country. He would earn a reasonable commission on all goods ordered, and would be in a position to secure, within a very brief time, by postal parcels, the goods which the customer, after looking over the catalogues and receiving the advice of the merchant, should decide to order.

There would be no investment and no risk, such as is involved in carrying a stock of goods which may become unsalable. Without large capital, he is now handicapped by being compelled, on account of the discrimination against him as a shipper, to lose the sale of all those articles which he cannot carry in stock in quantities, and which may, under present arrangements, only be shipped in bulk. If he attempts to use the mails, the rate of sixteen cents per pound is prohibitive, while the fact that the bulk is limited to four pounds is almost equally so; and the express companies’ charges are so high that in the majority of cases he cannot utilize their services.

Let us suppose that, instead of the United States’ charges for postal parcels being six thousand per cent. greater than Germany’s they were on a par, and that the country merchant could receive parcels weighing from one ounce to one hundred and eleven pounds for a quarter of a cent a pound. _It is not even necessary that the rate should be so low. Let it be made four times as great as that of Germany_, or one cent per pound, and let us see what advantage the country merchant would have. One hundred and ten pounds covers nine-tenths of the articles which he would be likely to sell. Instead of a store equipped with comparatively few articles, the country merchant would be able to carry, in addition to his regular stock, an extensive line of samples. He would familiarize himself with the best that there is in the market, be able to advise his customer to his advantage, and then, receiving the order, could, within a brief time, have the goods sent by parcels post directly to the customer’s home, saving the expense of handling two or three times--making more money by a small commission than he does now by the larger margin on the goods which he is compelled to carry constantly in stock.

Good organization is the trend of modern business, and this is good organization--saving two or three handlings, truckage, some bookkeeping, et cetera.

II. _The Manufacturers._ Next to the country merchant, the manufacturer will be the largest beneficiary of the postal parcels delivery. Take, for instance, the hardware business. The manufacturer is obliged, under the existing conditions of trade, to maintain large stocks in an endless number of cities scattered over the country, or do what is the equivalent of directly maintaining the stocks--that is, to give extended credit. This is because there is no way of handling small parcels of hardware without a cost that is so excessive as to force shipments of hardware to be made in bulk. With a one-cent-per-pound rate, more than fifty per cent. of the stocks now carried could be eliminated and orders sent by the hardware merchant directly to the manufacturer to be shipped by package. One hundred and ten pounds would cover the greater portion of the trade, and leave only nails, barbed wire, and similar articles, for bulk handling.

In cotton goods, instead of shipping from the Mills to New York, trucking them there through the streets, breaking bulk, repacking, retrucking and reshipping to the merchant there would be but one operation. A single piece of goods would go direct from the factory by parcels post at a total cost for handling not to exceed twenty per cent. of the charges now engendered by our clumsy, costly and inconceivably stupid method.

The same thing would happen in the grocery business. A factory in Rochester or Pittsburg, manufacturing canned articles, must ship in bulk to New York, or Chicago, or St. Louis. There the car-load, after being hauled to a warehouse, is broken up and transshipped. There is no reason for this transshipment, no possible excuse for this waste of money, except that the ownership of the express by a few private companies has prevented the organization of a parcels post upon lines which have long been recognized as absolutely successful in Europe.

The question here will be asked: Would this shipment direct from the factory interfere with the business of the wholesale merchants whose task it is now to repack and reship? On the contrary, it would simplify their work and reduce expenses from every point of view. Their business primarily is one of distribution of credits. They have certain customers who receive from them certain lines of credit. They furnish the capital between the manufacturer and the retail dealer. If tomorrow they could order by letter or telegraph, directly from the factory, for shipment to the retail dealer by postal parcels, their business would be greatly simplified and their profits increased.

III. _The Merchants in Large Cities._ Perhaps to no class will the boon of a parcels post be greater than the merchants in the large cities. All the way from four cents to fifty cents is now paid for the delivery of a parcel within a radius of thirty miles around the leading cities of this country. Experiments have shown that it is possible, where the interests of a considerable number of merchants are combined, to deliver an average dry-goods parcel, thirty miles out, at a cost not to exceed four cents.

As conducted today, the business of delivering parcels consists in sending the wagon of one dry-goods house to follow another into a city block, and deliver each its parcel; then each wagon goes off to another block, and delivers its parcel. In New York city thousands of wagons meander through the two or three thousand miles of streets, each firm doing its work independently of the others, and each wasting money by lack of cooperation.

It is altogether probable that with thorough organization city delivery could be conducted, within a radius of thirty miles, upon a basis not to exceed one half cent per pound. This would mean but two cents per package for the average four-pound dry-goods parcel, including, of course, the large number which are transported but a few blocks. But that is not the only advantage. It would take from the merchants the constant effort which the maintenance of good delivery systems involves. I have personally studied the delivery systems of nearly all the leading merchants in New York, Philadelphia, and Boston, and have spent a day in the delivery department of Marshall Field in Chicago. Everywhere I heard the same complaint--that the brains consumed in managing the parcels delivery was one of the most expensive items in the cost of operating a great establishment.

IV. _Book Publishers._ The cost of delivering a book by mail is now eight cents per pound. This, for a four-pound book, means a tax of thirty-two cents. Just how far this retards the development of intelligence in the people is not difficult to estimate.

V. _Stationers’ Supplies._ The large class of manufacturers and wholesalers who are engaged in supplying the stationery trade would find the parcels post a great convenience in receiving supplies and in delivering to customers; a matter of lessened capital, lessened trouble, and greatly increased profits.

VI. _The Railways._ At first sight it might appear that the interests of the railways would not be favored by a postal parcels law. But the briefest analysis of the problem shows that the benefit to them would perhaps be greatest of all.

To-day vast numbers of freight-cars stand idle, waiting carload shipments. These bulk shipments are necessarily made at the very minimum of cost. In the low price of bulk shipments, American railways lead the world. Even at existing prices, however, water transportation carries off a large part of the burden.

The benefits to the railways, by transferring freight from the class of bulk to parcels, would be:

1. Goods being shipped in a constant stream of packages, instead of intermittently by car-load or train-bulk;

2. A higher price would be obtained from shipments of the same freight in parcels as compared with the previous cost in bulk;

3. The large increase in traffic due to better, cheaper, speedier and more direct, and in every way infinitely more convenient, facilities;

4. The additional prosperity which a saving of anywhere from two hundred and fifty to six hundred millions of dollars per annum would mean to the country at large.

There are to-day far-seeing railway officials who have given this problem serious consideration, and who have arrived at the conclusion just stated.

VII. _The Farmer._ Last, but not least in importance, comes the farmer. To-day, cut off from parcel delivery, he is the victim of bad government, both in his bad roads and lack of postal facilities. The one step of progress that the United States post-office has made of recent years, that is worthy of respect, is the rural postal delivery. As proposed, however, it is ridiculous. The idea was advanced by some politicians for the purpose of creating additional patronage. Merely to deliver letters and newspapers to the farmer would, of course, be to operate a service without hope of placing it on a profitable basis. It would be as if the New York merchants would keep a thousand wagons traveling around the streets of New York to deliver nothing but kid gloves and lace veils--nearly empty, while other wagons would be carrying the burden of the goods sold.

Rural free delivery is absolutely impossible unless accompanied by a postal parcels law. Giving a rate even four times as high as that of Germany, the entire rural delivery could be put on a paying basis to-morrow.

Here again would be an advantage to the country merchant. The farmer to-day, when he wishes to buy, hitches up a pair of horses, drives four or five miles, and makes a few purchases. If the United States had the postal parcels law of Austro-Hungary, the farmer would draw a postal check, mail it free, the merchant would deliver the goods to the post-office, and a few hours later they would be in the hands of the farmer.

The life of the farm, which has so many drawbacks, would thus be made vastly more comfortable. It is impossible to estimate in dollars how great the saving to the country would be in this one particular.