Friday, May 23, 2008
A Price Increase That Isn't Gas
So postage went up by a penny earlier this month, and naturally someone had to run out to pick up new $.42 stamps. While there, a conversation ensued that went something like this:
"Would you like to buy 'forever' stamps?"
"What's a forever stamp?"
"They still work when the postage goes up."
"So do they cost more?"
"No."
"I don't get it."
Et cetera. When he got back, he asked me if I'd heard anything about them, which I had. He couldn't understand why such a thing would be available for the same price as regular stamps. Well, there are two main reasons.
First, 1 and 2 cent stamps aren't exactly profitable. They're sold because people inevitably have stamps left over from before the increase and would like to be able to use them. I would guess that 1 and 2 cent stamps are a loss (all-told) that is factored in when the decision to raise postage is initially made. Following this line of thought, it makes sense that the post office would just as soon sell nothing but forever stamps, and probably still only makes regular stamps available for collector's and philatelists.
(look it up--you'll be glad you did)
Second, the post office is not a business so much as it is a branch of the government. Sort of. It still wants to cover its expenses, but it ultimately is a service being provided to citizens and ought to reflect the will of the citizenry. So when people complain about postage increases, the forever stamp addresses that.
And as a caveat to that, there's a certain economic perspective. When you buy a stamp, what you intend to buy is a first-class stamp, but what you're really buying is $.42 cents worth of postage. So from the consumer's perspective, a stamp should be a stamp should be a stamp, whether the value of it changes or not. That's the way it is with every other good, why not this?
Have a good weekend, a good holiday.
"Would you like to buy 'forever' stamps?"
"What's a forever stamp?"
"They still work when the postage goes up."
"So do they cost more?"
"No."
"I don't get it."
Et cetera. When he got back, he asked me if I'd heard anything about them, which I had. He couldn't understand why such a thing would be available for the same price as regular stamps. Well, there are two main reasons.
First, 1 and 2 cent stamps aren't exactly profitable. They're sold because people inevitably have stamps left over from before the increase and would like to be able to use them. I would guess that 1 and 2 cent stamps are a loss (all-told) that is factored in when the decision to raise postage is initially made. Following this line of thought, it makes sense that the post office would just as soon sell nothing but forever stamps, and probably still only makes regular stamps available for collector's and philatelists.
(look it up--you'll be glad you did)
Second, the post office is not a business so much as it is a branch of the government. Sort of. It still wants to cover its expenses, but it ultimately is a service being provided to citizens and ought to reflect the will of the citizenry. So when people complain about postage increases, the forever stamp addresses that.
And as a caveat to that, there's a certain economic perspective. When you buy a stamp, what you intend to buy is a first-class stamp, but what you're really buying is $.42 cents worth of postage. So from the consumer's perspective, a stamp should be a stamp should be a stamp, whether the value of it changes or not. That's the way it is with every other good, why not this?
Have a good weekend, a good holiday.
Labels: business
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