This is kind of a strange comment. I don't think a lot of HN folks have worked in last mile logistics, but $2/package is average to above average. Amazon typically pays around $1.50 for Prime packages and I would say it isn't just the upper middle class that is buying from Amazon at this point. If people don't pay for shipping, there will be a human cost. If people are willing to pay for some aspect of value-add (actually coming to your door, caring about retry attempts, caring about lost packages, caring about how well the people involved are treated) this would change fast. Anyone who tries to go slower than peak speed or do it ethically gets crushed by someone doing it faster or in a shadier way, because people refuse to pay for shipping.
The point is that if $x/item is a reasonable cost for doing something in an industry, it's ridiculous to expect a comparable cost from workers who do something else, specialize in something else, and don't do it full-time on a sufficient scale to optimize their workday/workflow.
It appears that Walmart for some reason thought that having their existing associates to do it "on the side" after their ordinary job will somehow be more efficient (or even just as efficient) than hiring people to actually do that (and just that) efficiently. Clearly this experience shows that it's not, and doing it in the way described in the article would reasonably cost much, much more than $2/package; and getting it done for "industry standard" prices would require doing it in the "industry standard" way.
I know absolutely nothing about last mile logistics, but it's strange to me that (at least in the U.S.) we literally have someone going to practically every single house and business 6 days a week (postal carrier), and yet this is still a problem. I would think leveraging the human already coming to house every day would be the most efficient?
Look up FedEx SmartPost, UPS Mail Innovations, DHL eConmerce, etc. these are all companies who “work share” with USPS. They deliver the package to the post office and USPS leverages their existing network of mail carriers to do the “last mile” delivery.
The problem with these services is that they are very slow. The hand-off at the post office adds a day. Additionally these are considered economy services without a delivery guarantee by the carriers so they will wait until they have a full trucks worth of these before sending them on a leg.
Wal-Mart is trying to get to same day delivery and bringing everything to the local post office for them to deliver would add at least a day.
Furthermore those USPS economies suffer a bit once packages exceed 1 lb. it’s often too big for a letter carrier to take on their route - so they’d be delivered through the priority mail network which is often a different driver than your daily mail man and does not deliver to every house every day.
Given that package delivery is where USPS can profit, I wonder why Amazon/Walmart don't lobby to modernize USPS so it can cover the use-cases - why not deliver multiple times per day? There's no greater economy of scale than "delivering everything to everyone".
I mean, that's a rhetorical question. Obviously they'd both prefer to monopolize a for-profit alternative to USPS... but it seems short-sighted
There's really no hope of modernizing USPS. The political cost of substantial investment into USPS is higher than the actual cost of capital. If they want to control the quality of their service, it can't involve USPS.
Can you provide a citation? My understanding is that the USPS is constrained by conservatives trying to break them financially by requiring pension funding requirements drastically beyond what is considered reasonable based on their workforce. Therefore, USPS could modernize when Congress is replaced with politicians not working on dismantling the institution through legislation.
“Back in 2006, Congress imposed a huge and unprecedented mandate requiring that the Postal Service pre-fund future retiree health benefits for the next 75 years and do so within a decade – something no other public agency or private company is required to do.”
“As a direct result of pre-funding, USPS has reached its $15 billion debt limit. In 2005, the Postal Service was debt free. Today, it holds $15 billion in debt – all of it traceable to pre-funding. By forcing the Postal Service to use all of its borrowing capacity making these annual payments, Congress has prevented it from investing in new infrastructure, products and services to better serve American homes and businesses.”
In 2005, the Postal Service was debt free. Today, it holds
$15 billion in debt – all of it traceable to pre-funding.
I'm curious to know more about this.
If I've promised an employee $X of retirement benefits based on years they've already worked, am I "debt free" by the definition of that article, or do I have $X of debt?
The only thing unreasonable is the fact that only USPS is held to properly account for their post retirement benefits, whereas all other government agencies get to make up numbers and lay it on future taxpayers as the debts come due.
I worked at an actuarial firm for a few years, and passed the exams required to be an associate actuary in the US. However, anyone can claim anything on the internet, and I shouldn't and can't claim to be all knowing about actuarial accounting, but I do think I can claim the following:
1) In order to account for something, you have to be able to measure it. Promising a population healthcare until they die requires you to know how much healthcare they will need and how much healthcare will cost, and since this is until they die, you need to know these numbers 30 to 70 years into the future.
I don't think anyone is capable of seeing that far into the future with any kind of reasonable certainty, especially not with healthcare. Therefore, it can't even be possible to "properly" account for this kind of promise, and consider the fact that pretty much every other non taxpayer funded organization has slashed and removed post retirement obligations due to skyrocketing healthcare costs and the inability to fund them.
Sec. 8909a. Postal Service Retiree Health Benefit Fund
The law requires funding of accrued benefits. I don't think it's unreasonable to require someone to set aside funds for something that has already been promised. In fact, I think the opposite is ridiculous, which is the way most government agencies work, and the USPS has worked with their pay as you go nonsense:
Basically, "pay" someone whatever you want now, and then actually pay for it later by raising taxes is what that means to me. I also consider it buying votes from the union members without having to increase current taxes. However, the fact that this type of law only went into effect for USPS does make me think some lobbyist of Fedex/UPS did a fantastic job.
3) The hundreds of billions of dollars of unfunded healthcare and defined benefit pensions from governments are evidence enough that whatever is going on in the benefit accounting world is not right. I know from sitting in on meetings that the people smart enough to calculate the liabilities aren't actually on the board, that's usually reserved for the uneducated policeman or firefighters and city council members who are exchanging union votes for benefits. Then they tell the actuarial what % return on investment to use to make the liabilities look smaller. Then the actuary puts a little notice in their report that says they don't agree with the unreasonable 8% return on investment assumption, but what difference does that make?
Also, in the pension consulting world, having funding for only 80% of the accrued liabilities is considered "fully funded". That is laughable. Look up what your city/county/state's funding ratios are.
In general, I simply point out the fact that no one can predict, with any reasonable accuracy, that far out into the future for something so complicated (lifespans, healthcare, investment returns, etc), so you can't really account for the liabilities in the first place. And from the fact that pretty much every single defined benefit pension that private organizations offered is no longer offered (due to strict funding requirements from ERISA and PPA laws, conveniently exempting taxpayer funded organizations), and the taxpayer funded ones that are very underfunded, you can surmise that the whole thing doesn't work. Too much money at play, too many ephemeral decision makers at the table who can pass the buck and reap the rewards, which all adds up to too much agency risk. Which, funnily enough, is never taken into account with these long term obligations.
How does this effect you in day to day life? Enjoy the deteriorating subway service, school systems, roadways, water quality, air quality, etc. as all that increased tax money goes towards these unfunded benefits for retired people.
Citation needed that conservatives killed USPS. I didn't find any unbiased sources to confirm this. To the contrary, the 2006 bill was a bipartisan measure passed by voice vote in the House and unanimous consent in the Senate.[1]
While that's true, it doesn't appear to have been a partisan or even controversial bill at the time, so I feel that it's disingenuous to blame Republicans.
If you control the majority of a legislative body, I argue it’s reasonable to blame that party for legislation they pass (as they could just as easily not pass it with the control they have). Likewise, the Republican President could have vetoed it (which he did not do).
Also, the legislation was sponsored by a Republican (Thomas “Tom” Davis III
Sponsor. Representative for Virginia's 11th congressional district).
And the other party, which came into power just two years later also "could just as easily" have repealed it. So you must blame the other party as well in this case.
I've gotten more months of free Amazon Prime from UPS Mail Innovations packages that missed the "guaranteed" delivery deadline than all other sources combined.
If I could reliably predict which packages would come vs MI, I might never have to pay for Prime again.
You can think critically while simultaneously using exaggerated figures for emphasis. Especially when the figure cannot be precise.
The argument is that these people are choosing to do this. They can choose to spend their time however they please. They know the full terms of the offer, and they choose to accept. There are people in the world who would cross oceans and deserts just to be able to have the opportunity to accept a similar job.
The poor in the USA live better than kings in other parts of the world.
