>What concession? It's a clear market distortion that shipping rates across such distances are so ridiculously low. I'm not sure why anybody is supporting them.

Come on, everyone supports ridiculously low costs on anything.

You can't just mandate low costs by fiat. That's why it causes market distortion.

You could also say mandate that say breakfast at a hotel should cost no more than $1. You'd get that, but you'd also pay for it via rising hotel prices that would need to subsidize that benefit some enjoy with a higher room fee that everyone would pay for.

In this case lower shipping rates for some are subsidized with higher shipping rates for others, or in some other countries with the same problem corresponding state subsidies for the postal service paid for out of the general state budget.

We don't know that they're below cost. Maybe the market distortion is that internal mail is so expensive.

EDIT: whoops, untrue as below. Disregard this.

We absolutely do know this, the UPU (universal postal union) has a mandate to subsidize mail rates from nations that are termed developing under its rules, like China.