J.D. Durkin: Amazon Could Actually Be Saving the Postal Service
President Donald Trump is no stranger to Twitter beef. He’s taken shots at everyone from the North Korean dictator, Kim Jong Un to the NFL. More recently the United States President has set his rabid Twitter fingers on Amazon.
Late in March, Trump took to his favorite social media platform to rant about how the e-commerce website is using the United States Postal Service as its “delivery boy.” He claimed the company was skirting taxes and paying discount fees to use the USPS’s service, essentially getting rich while the postal service loses money. But Cheddar reporter, J.D. Durkin explains that Amazon might actually be saving the USPS.
“The post office did see a revenue decrease of about $2 billion last year but that was largely due to the decline of people and companies sending actual mail,” he explains on Morning Bell. “Regular mail is one thing, but we all still get packages. USPS package volume grew by nearly 600 million pieces, an 11 percent year over year increase, so in that case, Amazon actually increased the bottom line of the mail carrier.”
The USPS ships roughly 40 percent of Amazon’s and it is true that the Post Office cuts deals with the company, but it does the exact same with every other bulk shipper. Regardless of that, the 2006 Postal Accountability and Enhancement Act made it illegal for the postal office to price parcels below its cost. So while the amount Amazon pays for each delivery is unknown, it’s guaranteed that the Post Office is at least breaking even.
While Trump’s tweets might not hold up, the President could have had other reasons for blasting the company. Amazon’s CEO, Jeff Bezos also owns the Washington Post, which has had a track record of criticizing the Trump Administration. The President’s tweets have been known to move stocks, these social media attacks could have been a way to take a dig at Bezos’ assets.
“The President’s anti-Amazon tweets have in some cases coincided with some of The Post’s most negative headlines about the administration,” he says “Amazon stock took a dive after each one of the President’s tweets.”
Regardless of the motives behind Trump’s unfounded criticism, it’s clear that without each other neither Amazon or the USPS could operate efficiently. This makes their relationship more mutual than lopsided.