Regulating Private Mail Boxes

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Thank you for the opportunity to testify today on the problems of the U.S. Postal Service's new regulations on commercial mail-receiving agencies (CMRAs) that offer private mail boxes for rent.

The sloppy, capricious and arbitrary manner in which the Postal Service hasmade andimplemented those regulations has harmed small businesses and customers ofthosebusinesses alike. But the Postal Service not only is exempt from all taxesand mostregulations to which its private competitors are subject, it is exempt frommost federalregulations to which other federal agencies are subject. For example, it isnot subject to Title 5, Chapter 7 of the U.S. Code which grants citizens anappeals process for actions that are "arbitrary and capricious." The newregulations on CMRAs illustrate why the Postal Service,a government monopoly with regulatory powers that it can use against itscompetitors, atminimum, should be made subject to the Paperwork Reduction Act, RegulatoryFlexibilityAct, the Results Act, and other federal statutes meant to protect citizensagainst abuses bygovernment agencies, and why the new regulations on private mail boxesshould be repealedimmediately.

When the government uses its power to restrict the freedom of citizens orto impose uponthem financial burdens, it must make the case why this is absolutelynecessary for theprotection of the lives, liberties and property of the citizens. The burdenof proof is on thepeoples' servant, the government. The Postal Service has failed in itsresponsibility to makethe case for the new regulations on private mail boxes…

The bottom line is this. The U.S Postal Service should be brought under allof the rules andregulations to which other government agencies are subject, including theAdministrativeProcedures Act, the Paperwork Reduction Act, Regulatory Flexibility Act,and the ResultsAct. Under these regulations the Postal Service would be required to stateexactly whatgoals it seeks to accomplish through its regulations, where it gets theauthority to seek suchgoals, how its policies are meant to obtain such goals, and what evidenceit has that thosegoals are achieved through those regulations.

When it makes new regulations it should be required to show exactly whatthe expectedbenefits will be, what the expected costs will be, and how those benefitsoutweigh the costs.It should be required to show that the regulations it chooses are the leastcostly compared toother alternatives and are the least burdensome for small businesses.

Postal officials might argue that such a regulatory regime will harm itsefficiency. But thePostal Service has used its regulatory powers to harms private competitorslarge and small,as well as consumers. Other countries have discovered a means to deal withthis dilemma.They are privatizing their postal services. New Zealand and Sweden alreadyhave done so.The largest mail carrier in Europe, Deutsche Post in Germany, is now underprivatemanagement. It pays taxes on its competitive services and is subject to thesame regulationsthat are imposed on other businesses. Next year it makes an initial publicoffering of itsstock, and on January 1, 2003 its monopoly on mail delivery will beabolished.

In conclusion, the Postal Service's new regulations on CMRAs have beenenacted andenforced in a sloppy, capricious and arbitrary manner. The Postal Serviceshould be subjectto the same checks on its power to which other government agencies aresubject. And until itcan make its case in accordance with those safeguards, the new regulationson private mailboxes should be rescinded.