Trump, Having Denounced Amazon’s Shipping Deal, Orders Review of Postal Service
While the service has consistently reported net losses for a decade, much of its financial woes are the result of a prolonged decline in the volume of marketing mail and first-class mail. The service makes money on packages, and Amazon is the service’s biggest single shipper of packages.
But the president has refused to believe those arguments, insisting in a tweet as recently as March 31 that “the U.S. Post Office will lose $1.50 on average for each package it delivers for Amazon.”
“That amounts to Billions of Dollars,” he continued.
Mr. Trump’s repeated attacks on Amazon have focused in part on the company’s billionaire owner, Jeff Bezos, who also owns The Washington Post. People close to Mr. Trump have said the president’s tirades against the retailer often come after The Post has published negative articles about him.
“The #AmazonWashingtonPost, sometimes referred to as the guardian of Amazon not paying internet taxes (which they should) is FAKE NEWS!” he wrote last June.
“Is Fake News Washington Post being used as a lobbyist weapon against Congress to keep Politicians from looking into Amazon no-tax monopoly?” he wondered the next month.
At one point last month, Amazon’s stock price tumbled after Mr. Trump’s tweets and a suggestion that he might direct the government to take action against the company.
Drew Herdener, an Amazon spokesman, declined to comment late Thursday.
But until Thursday night, Mr. Trump had limited his attacks to ones on Twitter. The White House had said the president did not have immediate plans to take any action against Amazon and had given no warning that the executive order was coming.
In the order, the president calls on the task force to examine various parts of the Postal Service’s business, including ones that appear to directly involve large parts of Amazon’s business.
That includes the “expansion and pricing” of the package delivery market and the service’s role in competing with other, private delivery companies. The task force should look at the decline in mail volume and the implications for the service, Mr. Trump said.
The order also calls for the task force to look at the service’s “universal service obligation,” which requires the service to deliver to everyone in the United States, given changes in technology and e-commerce.
Some parts of the order appear to hint at further privatization of the Postal Service, indicating that members of the task force should examine “the U.S.P.S. role in the U.S. economy and in rural areas, communities, and small towns.”
In the order, Mr. Trump said that the longstanding financial problems at the Postal Service demand some kind of action.
“A number of factors, including the steep decline in First-Class Mail volume, coupled with legal mandates that compel the U.S.P.S. to incur substantial and inflexible costs, have resulted in a structural deficit,” Mr. Trump says in the order. “The U.S.P.S. is on an unsustainable financial path and must be restructured to prevent a taxpayer-funded bailout.”
It is unclear how quickly the task force will be assembled, or when its review might result in changes at the Postal Service that could directly affect Amazon and other shippers.
In May, Mr. Trump created a similar commission to examine what he said was evidence of large-scale voter fraud in the 2016 election — a claim that was repeatedly debunked by election experts from both major political parties.
But he dissolved the commission in January after several legal challenges and a lack of cooperation from Democratic and Republican election officials in a number of states.
In the case of the Postal Service order on Thursday night, Mr. Trump demanded that a report of findings be delivered to him by summer’s end. He urged the task force to recommend administrative and legislative changes that could be made.
Those recommendations could take into account previous studies, including a 2017 analysis by Citigroup, which concluded that the service was charging below market rates for package delivery.
The report estimated that if the service increased its parcel rates, Amazon’s shipping costs would rise by about $2.6 billion. Some of that money would presumably go to the Postal Service, which in 2014 handled 40 percent of Amazon’s packages, according to one 2015 estimate.
Mr. Trump’s task force does not address the president’s other complaint about Amazon: that the online retailer fails to pay sales taxes, giving it an unfair advantage over brick-and-mortar businesses.
In fact, while Amazon used to benefit from tax-free sales, it now charges sales tax on the sale of virtually all of its own products. Many third-party merchants who use the service to sell their own goods on Amazon’s sites still do not charge sales tax.
News credit : Nytimes