Thursday, August 06, 2009

NO, not too BIG to fail, TOO politically powerful

Companies that fail to make a profit SHOULD go bankrupt. Their assests can then be distributed to companies that can utilize them efficiently. The Free Market is the most efficient method of allocating resources because decisions are made where resources are being used. The free market has produced unprecedented levels of prosperity BECAUSE it acomodates change better than any other method of producing goods and servcies.

Government, on the other hand, institutionalizes the staus quo. Government is the greatest barrier to change. That is why government directed economies fail time after time after time.

The US Post Office WILL FAIL, in fact, it has already failed. The politicans simply refuse to recognise the failure and they continue to use taxpayer dollars to subsidize the failure.

Link

The U.S. Postal Service on Wednesday announced a loss of $2.4 billion in its third quarter, underscoring the financial woes of an agency already groaning under the weight of the recession.

USPS reported a $1.6 billion decrease in revenue between April and June, and a total net loss of $4.7 billion so far for fiscal 2009. It has now suffered net losses for all but one quarter in the last three fiscal years.

Some attribute the staggering net losses to a requirement, approved by Congress in 2006, that the Postal Service make advance payments to cover the costs of health benefits for retirees.