Writing in National Post, Chris Selley addresses a couple of lingering issues. First, the financial viability of Canada Post:
Over the next seven years, the board predicts a 27% decline in domestic transaction mail — bills, cheques, letters —a 26% drop in addressed and unaddressed ad-mail and a 26% decline in its publication traffic. It projects Canada Post will have a $1-billion deficit in 2020.
Mr. Selley argues capably that the status quo in mail delivery in Canada is not sustainable. It is silly to offer daily mail to all urban locales, especially as remote regions get far lower levels of service. As Mr. Selley notes, it is these remote regions that most need mail delivery, as they’re not as well served by internet connectivity as their urban brethren. Thus, Mr. Selley argues, subsidization that would have to go to Canada Post should, instead, be routed towards subsidizing broadband service across Canada (an idea that’s been around for at least a dozen years):
There remains the issue of far-flung and remote communities. Some might question the very idea of subsidizing life there, in general. Not me. But there are other ways to subsidize the delivery of truly essential mail to those communities than to have a monopoly charging the same price to send a letter to Resolute as to send it across town. If we’re going to subsidize anything, in the long term, subsidizing Internet connectivity in such communities, and thus direct connection to the global economy, strikes me as a vastly superior investment.
Personally, I’m still not sold on the idea of subsidizing life in those remote communities (beyond our basic welfare system), so I’m not sure I can get on board with subsidized broadband. However, if I’m given the choice between continued subsidization of Canada Post or subsidizing broadband connections, I’ll definitely choose the latter.
Not everyone in those remote communities necessarily has a computer (lots of elderly folks don’t), so I think there’s still a role to be played for regular mail. But expanding Internet access is definitely a good idea.
I don’t have a problem with Canada Post having a “deficit”. It’s a provider of a public service. Its purpose is to provide that service effectively, not to turn a profit. The idea that any public service or crown corp. that isn’t turning a profit is “failing” in some way is just an ideological gambit to try to get those services privatized.
What seems interesting to me in Selley’s argument is that when he talks about not subsidizing Canada Post, his recommendations are to eliminate services in dense, urban regions. He argues against door-to-door mail in urban centres, and suggests that non-parcel delivery needn’t be daily.
What he seems to be arguing for is bringing the level of service in urban centres down to the level in remote areas, and noting that it’s pretty backwards that remote centres get better mail service even though they don’t need it as much. From that, I take it to mean that he would fund broadband access to remote communities while still maintaining their level of mail service.
It’s hard to say that his suggestion is a back-door route to privatization when he’s talking about increasing subsidies to remote communities.
But if its ok for Canada Post to lose money, whose mail service deserves to be subsidized? Certainly not the 165 tonnes of junk mail sent out by one bank last year.
It took me a bit to figure out that Canada Post wasn’t a newspaper (I was wondering why I hadn’t heard of it).
I am inclined to agree with KMW about subsidies. I’m biased, of course, but I think that the ability to send and receive important documents in a reliable manner – even where it’s not profitable – is one of the things that we have governments for. I happen to think that if the US (and I’d guess Canada, though I know less about it, obviously) stopped with the government postal service, someone would step in for places that aren’t Alaska. But I don’t mind the government being the guarantor. And besides, even people in Alaska need mail.
Now, we can say “Trumwill is biased, living out in the middle of nowhere and supporting services for people living out in the middle of nowhere.” Maybe, but I should add that I am not big on the universal broadband proposals for communities like mine. It’d be nice, but it’s not a good use of tax dollars. I think mail service is.
As an aside, it’s a point of contention with me that people say it’s “ridiculous” that it costs as much to send mail across town as it does to send it to BFE. Actually, that’s entirely logical. You see it in private industry all the time. Verizon, DirecTV, and others charge Twin Falls the same as Seattle even though profit lines differ greatly. It’s a matter of price simplicity.
Junk mail, in my view, ought to be a profit center. It shouldn’t really be subsidized.
This all makes sense, Will, but I think Selley’s argument that cuts to Canada Post service should be focused on urban centres aligns with your concerns. Mail service to remote locations could still be done at a loss, but if Canada Post can make up for that in urban centres, then I think we all come out on top.
Here’s another question regarding broadband: what’s more valuable, to broadcast TV and radio everywhere throughout Canada (at the expense of taxpayers) or provide everyone with a halfway decent internet connection?
I don’t know the answer, but I think the status quo (both for Canada Post and CBC) are less than ideal.
That sounds suspiciously like “screw the urban to pay for the rural”.
If the urban services are profitable (or break even) and rural services are not, how exactly is it fair to degrade urban services to make up the shortfall?
It seems bad enough the urban centers are subsidizing the rural centers at all.
Me being a fairly solid liberal, I’m pretty okay with that in general — although it’s also been my experience that the rural folks tend to gripe about “takers” to an ironic degree — but I’m a bit aghast at just casually throwing out degrading current service for the people who ARE paying their way for the folks that aren’t.
That sounds suspiciously like “screw the urban to pay for the rural”.
Yup, that’s pretty much what it is, and it’s quite in line with a number of projects throughout Canadian history. The completion of the railroad was prerequisite for confederation, even if it didn’t necessarily make economic sense everywhere. Ditto the CBC. The supposed raison d’etre of our public broadcaster is to make sure that there is radio/TV broadcast throughout the land, even those places where there isn’t a sufficient market to demand a radio or TV station.
I think it’s fair to say that Canada has made the decision to provide coast to coast to coast mail service, even if it’s not always economically feasible. And we’re going to try to make that service as “fair” as possible… different people just have different ideas about what constitutes fair.
Personally, I’m not really supportive of this mentallity, but there doesn’t seem to be much political will to change it. So, stuck with this paradigm, I’m interested in better ways to function.
…although it’s also been my experience that the rural folks tend to gripe about “takers” to an ironic degree…
Uh… yeah. I hear you.
Rural Canadians also pay taxes. While rural infrastructure crumbles at the same rate as urban infrastructure, millions of tax dollars paid by Canadians (some rural) flow in to cities to fund expensive public transit systems that some will likely never get to use. How is that for Rural griping for you? It works both ways….. You don’t want to pay for their expensive mail service and broadband accessibility? They probably don’t want to pay for your subways.
The transit comparison is an interesting one. It’s a big topic in Ottawa, since the various municipalities amalgamated – including a lot of rural areas. Not everyone was going to get the same bus service, which led to some contentious debates.
It’s an interesting question as to whether rural infrastructure does crumble at the same rate, or faster, or slower that urban infrastructure. We would also have to decide on how we judge that. It’s not just at the same rate, but at the same rate per tax payer or tax dollar. Let’s also remember that property taxes aren’t uniform in urban and rural areas. As well, many urbanites use rural infrastructure and many rural residents use urban infrastructure (indirectly, we all use all of it, kind of). To try to determine a truly fair means of funding it all seems like a fool’s errand. The best we can do is be fair enough.
The comparison between paying for mail and broadband vs. paying for subways is a bit off the mark, though. Mail service will be supported by the feds, whereas transit is a municipal concern, with assistance from the provinces (though, if it were up to me, much of it would be self-sustaining, and I don’t really care what that would do to fares).
In the end, I think we’ve decided, through policies, that there is going to be some wealth-spreading when it comes to funding infrastructure, and what we need to do is find the best way to minimize the costs while maintaining a sufficient level of service. I think reducing general mail service in urban areas is a good start (either by eliminating door-to-door service or by reducing the days the mail is actually delivered, or both).
Crap, that was supposed to be a reply to Mike.