Before defining and demonstrating the advantages of a Government postal
express, however, it may be necessary to discuss more fully the features
which differentiate at present the parcel-post from the express service.
They fall into two classes, (a) Special forms of service, and (b) Rates.
Under (a):
_Express Company_ _Parcel Post_
1. Collects the parcel free of 1. ----
charge.
2. The fee includes insurance 2. Special fees for all
up to $50 without charge; insurance--insurance limit,
additional insurance up to $100.
any amount may be contracted
for by special fees.
3. All sizes and weights are 3. Weight limit--70 lbs. (300
accepted. miles), 50 lbs. (above 300
miles). Size limit--84
inches, length and girth
combined.
4. Collects fee from consignee 4. Collects fee from consignee
at destination free at destination at a fee.
of charge.
5. Collects cost of article itself 5. Collects cost of article up
to any amount. to $100.
6. Buys articles for customers 6. ----
at a fee.
7. Sells articles for customers 7. ----
at a fee.
It will be immediately realized that some of the features of the express
service which are not rendered at present by the parcel-post could be
and should be rendered by the parcel-post for one fee without separate
charges. On the other hand, it will be realized that some of these
features should be rendered by the parcel-post only as separate
privileges for which separate fees should be charged, as, for instance,
the service of collecting parcels from the shipper. (Note 2.)
For instance, there seems to be no good reason for limits upon the size
and weight of the packages in the parcel-post. These limits have
steadily been expanded in the parcel-post system from its inception, and
the process has so strikingly demolished whatever arguments for size and
weight limits may have previously been considered that they no longer
seem valid.
In Austria, Belgium, Denmark, Germany, Hungary, Norway, Rumania, the old
Russia and Switzerland, packages weighing up to 110 pounds may be sent
by parcel-post (and after 100 pounds the freight service of the
railroads is readily available in the United States as elsewhere). In
1915 France and Italy imposed weight limits of 22 pounds. In Belgium,
Germany, Hungary, Norway, Rumania and Sweden there is no size limit,
except that in certain cases special fees are charged for unusually
large sizes. In Italy, the limit is 24 inches in any one dimension,
although in certain cases packages 41 inches long are accepted. The
limit in Denmark is 39 inches in any dimension. In France, the limit is
60 inches in any direction. With no limits upon weight and size, the
parcel-post might handle the problem of especially cumbersome articles
whose size is disproportionately large for their weight by following the
example of the express companies, charging a special rate twice as large
as the normal rate. And as to shipments so bulky that especial
transportation facilities are needed for them another page might be
taken from the books of the express companies, and special preliminary
arrangements stipulated before such shipments are accepted.
Moreover, the experience of other countries proves that there is no
insurmountable obstacle to removing the limit upon the amount for which
a package may be insured. Merely, special provisions might be necessary,
and perhaps an additional fee above the normal insurance fee charged,
for articles such as jewelry, for which space in safes would have to be
reserved, and for bullion, etc. The following countries seem to have no
insurance limit: Austria, Denmark, Germany, Hungary, Portugal, Rumania,
the old Russia, Sweden, Switzerland. The limit in France is $1,000; in
Italy, $200. In addition, some countries give automatic indemnity
without separate insurance fee, up to a small amount.
Similarly, now that the parcel-post experiments for small amounts have
proved successful, the limit upon the amount collected from the
consignee for the expressed article itself could be and should be either
removed or greatly advanced, the fee for this service advancing with the
amount collected. Nor does any cogent barrier present itself against a
separate division in the parcel-post system to sell articles consigned
to it, or even to buy them, the fee again synchronizing with the amount
of the principal involved.
The features inherent in the express service and not now in the
parcel-post, as the express service and the parcel-post now function,
might be preserved by either of two methods. They might be added to the
present parcel-post as separate features to be utilized only when
especially desired and for which separate fees would be levied. Or else
the Government postal express might be organized into two separate
divisions--one for the services now rendered by the parcel-post, with
possibly certain additional fees for certain secondary features, to be
determined by experience in administration; and the other for the
services now rendered by the express companies, except those proved by
experience in administration to be homogeneous with the parcel post
service proper, and hence properly adhering to the first division.
Either the method of complete consolidation or the method of two
divisions would meet the exigencies of the service--only the results of
experience and experiment could award greater merit to one or the other.
The fact that these separate functions of the express service are of too
great value and in too great demand to be eliminated is seen by a study
of the relation of the express shipments and the parcel-post shipments
to the express and the parcel-post rates, this constituting the second
point of departure (b) between the public method and the private method
of transporting parcels. The differences between the express rates and
the parcel-post rates may be graphically realized from a comparative
table. As will be seen, the differences between the two sets of rates
may be roughly summarized in one sentence--as a rule, the parcel-post
rates are lower than the express rates for the shorter distances and the
smaller parcels.
Accordingly, if the value of the service rendered by the two systems
were nearly identical, the express company's shipments would be almost
entirely of larger parcels and for the greater distances. But as a
matter of fact it is generally known that a large proportion, a very
large proportion, of the shipments sent by express are at weights and
for distances at which the parcel-post rates are lower than the express
rates, often decidedly lower. Only the need to a shipper of all, some,
or any one of the above-discussed features of express service not
duplicated at present in the parcel-post system can explain this
situation. It is therefore imperative that the Government make provision
for all these features in establishing a Government postal express.
_COST OF LIVING_
A moment's reflection is sufficient to show that a Government postal
express would make express facilities available to a far greater number
of persons than are served at present by the express companies. For the
Government postman and the Government post office cover the country as a
whole--the express companies operate only along railroad, electric,
steamboat and stage-lines. Moreover, of these four media, 83.7% of the
mileage is by railroad and only 2.9% by electric line, 13% by steamboat
line, and 4/10 of 1% by stage-line.
All in all, the mileage covered by the express companies totals 307,400.
On the other hand, the mileage covered by the postal system is
1,374,056. Of this amount, 1,112,556 represents the mileage of the rural
routes alone, and the number of persons served by the rural routes in
1917 was more than 27,000,000. Of course, it is certain that not all of
the persons along these more than one and a quarter million miles were
deprived of the benefits of an express service, but it is equally
certain that many of them were, and it is probable that the majority of
them were.
But it is the extension of the express facilities to just that element
of the population living off the railroads and on the rural post routes
in which lie the greatest potential benefits that an express service can
render to the nation. For, speaking by and large, most of this
population is engaged in farming; and, conversely, possibly the majority
of the producers of foodstuffs in the country live off the railroads and
on the rural post routes. Now, it is stated on reliable authority that
of each dollar expended by the consumer for food in New York City, for
instance, the farmer gets only from thirty-five to fifty cents. In other
words, at least 40% of the cost of food is represented by the cost of
getting the products of the farm to the ultimate purchaser. The role
thus played in the drama of the high cost of foodstuffs and the high
cost of living generally is apparent. Equally apparent is the role which
a simplification of or a reduction in the processes of getting food from
the farm directly to the dinner table could play in lowering the cost of
living.
But such a simplification and reduction are possible only to a
Government postal express. At present the rural free delivery does make
provision for sending farm products directly from the farmer to the
consumer, but its efforts in this direction are still largely embryonic.
For the machinery of the process must be constructed anew and the task
of construction is one of those tasks which cannot be hurried. On the
other hand, the express companies have built up through the years an
extensive and efficient machinery for "farm to table" transactions, but
their services in this direction are hampered by the fact that the
companies are limited on the whole to the territory adjacent to the
railroad lines. The fertilization of the vast farming territory tapped
by the post office by the express company facilities should give birth
not many months after its consummation to the one most potent factor at
present available to lower the retail cost of foodstuffs to an
appreciable extent.
Under such an arrangement, a separate bureau would be established in the
postal system, covering both the parcel-post and the postal express.
This bureau would collect names of farmers--both those voluntarily
resorting to it and those reached in its own canvasses--who would send
their products collect on delivery to consumers. Similarly, lists of
consumers desiring thus to be served would be collected. It would be no
difficult matter for individuals on the two lists to get into touch with
one another, and to deal directly through either the parcel-post or the
postal express. Where they could not by their own arrangements get into
touch with one another, the bureau's task would be to get them into
touch. And where a farmer and a consumer could not even thus be brought
into direct contact, the bureau would act as the agent for
each--maintaining warehouses, if necessary, to which farmers would send
goods to be sold at a stated minimum price and to which consumers would
resort for their purchases. Since these functions are already performed
to a slight extent by the express companies, there should be little
question of the legality of such procedure by the Government. If
necessary, additional legislation might be sought; nor after the
activities of the Government during the Great War would there be much
likelihood of such legislation being declared unconstitutional.
_ECONOMY IN OPERATION_
It has been seen that about 50% of the charges collected by the express
companies for the transportation of packages go to the railroads, 50%
remaining to the express companies. To be exact, in 1917 the sum of
$222,860,373 represented the collection charges by the express
companies, of which $113,535,059, or 51%, went to the railroads, leaving
to the express companies from transportation, $109,325,314. Revenues of
the express companies from operations other than transportation brought
their total revenues up to $115,920,129. Their operating expenses were
$113,721,057. In other words, for every 10% by which Government
operation of the express service might decrease the operating expenses
of the express service, even if the present contracts with the railroads
are assumed by the Government, there should be a saving in the amount of
express rates assessed the public of no less than 5%.
Such savings seem inevitable under a Government postal express. Vast as
is the extent of the parcel-post operations, there is no evidence that
all or even most of its ramifications have yet reached that point of
magnitude where the addition of new business means an increasing instead
of a decreasing cost per unit. Let it be remembered that the parcel-post
carried in 1917 some 1,120,000,000 parcels and the express companies
some 280,000,000; so that, taking into account the secondary features of
the express service not performed at present by the post office, the
inclusion of the express service in the parcel post would increase the
latter's activities not much more than 25%. Certainly, it may be fairly
assumed that any such services in which the law of increasing costs per
unit might hold would be at least counter-balanced by services in which
the law of diminishing costs per unit would hold; so that we may
consider the economies of a Government postal express absolutely instead
of relatively.