AFFIRMATIVE DISCUSSION

Our Postal Express. pp. 1-6.

William Sulzer.

Mr. Speaker: I am in favor of a parcels post. I believe the people of the country generally favor it, and I feel confident its establishment will be of inestimable benefit and advantage to all concerned. The post-office is one of the oldest of governmental institutions, an agency established by the earliest civilization to enable them to inform themselves as to the plans and movements of their friends and foes; and from the dawn of history the only limit upon this service has been the capacity of the existing transport machinery.

The cursus publicus of imperial Rome—the post-office of the Roman Cæsars—covered their entire business of transportation and transmission, and with its splendid post-roads, swift post-horses, and ox post-wagons the Roman post-office was a mechanism far wider in its scope than that of our modern post-office; and except for the use of mechanical power, the old Roman post was far more efficient in its service of the Roman rulers than is our modern post-office in the service of the American citizen.

The evil of the Roman post-office and of the royal postal services that succeeded it was their common restriction to the enrichment of the ruling powers. They were the prototypes of our modern private railway and express companies, which have for their chief end the enrichment of their managers rather than the promotion of the public welfare. In this country the citizen owns the post-office and wants to use it as his transportation company. Its end is to keep him informed as to what his representatives are doing at the centers of public business, to make known to them his wishes, and to provide means by which he may communicate with his fellow-citizens for their mutual benefit, and to supply his wants and dispose of his wares at the least possible cost, in the shortest possible time, and with the greatest possible security.

The postal system of rates, regardless of distance, regardless of the character of the matter transported, and regardless of the volume of the patron’s business, eminently fits it for this great service. That it will sooner or later be greatly extended over the entire field of public transportation, is absolutely certain; and the people will duly appreciate the aid of those who assist in its extension and development. As far back as 1837, Rowland Hill, of England, promulgated to the world the law that once a public transport service is in operation, the cost of its use is regardless the distance traversed upon the moving machinery by any unit of traffic within its capacity, and upon this law he established the English penny-letter post of 1839.

Instead of a taxing machine, a contrivance for making money, the post-office should be an agency for good, reaching out its multitudinous hands with help and comfort into all the homes in our widespread land.

Without the post-office where would be that national unity, with its guaranty of equal rights to all, which is the glory of the sisterhood of states?

The postal savings system and parcels post was inaugurated in England largely through the efforts of the great Commoner, William E. Gladstone. Near the close of his life he made the following statement about it:

The post-office savings bank and parcels post is the most important institution which has been created in the last fifty years for the welfare of the people. I consider the act which called the institution into existence as the most useful and fruitful of my long career.

It is because we realize these truths so keenly that we are so persistent in urging favorable consideration of a parcels post. Its only fault is its conservatism. What this country now needs, what Congress should give it, is a parcels post covering much of the business of public transportation.

In April last representatives of at least 10,000,000 American voters, including the great agricultural associations of the country, National Grange, the Farmers’ Union, the Farmers’ National Congress, Retail Dry Goods Association of New York, the Associated Retailers of St. Louis, the manufacturing perfumers of the United States, the American Florist Association, and others, appeared before the House Postal Committee, demanding a domestic express post as extended and as cheap as that provided by the Postmaster-General in our foreign postal service. The argument in behalf of this legislation, with its 4-pound weight limit, had then been before the committee for many months, but the bill was not up to the demands of these friends of the post-office. The report of the hearing showed that the public wanted an 11-pound service at least. Seldom, if ever, has any proposition received a stronger public support, and it seemed as if the House Committee on Post-Offices would be obliged to report at least some legislation back to the House for its consideration.

Their answer finally came on the 27th of May in the shape of H. R. 26348, introduced by Chairman John W. Weeks, which provides:

That all mail matter of the fourth class shall be subject to examination and to a postage charge at the rate of three-fourths of 1 cent an ounce or fraction thereof, to be prepaid by stamps affixed—stamps of the following denominations:

Cents.

1 ounce¾

2 ounces1½

3 ounces2¼

4 ounces3

5 ounces3¾

6 ounces4½

7 ounces5¼

8 ounces6

On the 1st of June Mr. Weeks wrote to the secretary of the Postal Progress League as follows:

It does not seem to me likely that any other parcels-post legislation than possibly the bill which I introduced last week—this bill—providing for the reduction in rate on fourth-class matter, will be considered at this session of Congress.

This means that for at least two years more the American people are to be left subject to the extortions of the rich and powerful express companies, while we have in the post-office a well-equipped service of our own through which much of the people’s business now carried on by these companies could be done quicker and at infinitely less cost.

Mr. Speaker, if the powers arraigned against the post-office continue their efforts to limit its functions in behalf of private interests, they will soon find themselves confronted with a Congress pledged to extend the service of the post-office to a much larger degree of the public transmission business; and hence, I think it wise that my bill should now be brought before the House for immediate consideration.

World’s Work. 21: 14248-51. April, 1911.

Parcels Post and the Retailer.

Fremont Rider.

Of all the arguments against a parcels post by far the most venerable is that of financial disaster; and even April 1911 finds many an opponent of a parcels post uttering gloomy prophecies of the enormous losses which the system would entail, losses which would have to be met, as he takes pains to point out, by an already bankrupt post office department.

On the other hand, the men best acquainted both with the problem of transportation and its cost and with the parcels post as it has been worked out abroad, go so far as to say, that so far from being an expense, a parcels post would probably be the most profitable business venture into which the United States government ever embarked. In fact a private parcels post, in certain of the metropolitan districts at least, would probably be started by private capital were it not for one thing—the growing agitation for a government parcels post which would render valueless the plant of the private company.

The plan of this private parcels post, in direct competition with the present express companies is no chimera.... Every thinking person marvels at the economic waste in the present day methods of city delivery. By your house in Yonkers, for instance, if you happen to live in Yonkers, there now rattles, once or twice daily, the wagons of your butcher, your baker, your laundryman, your milkman, and your grocer, as well as those of the various butchers, bakers, laundrymen, milkmen, and grocerymen of your neighbors, all covering in staggeringly wasteful duplication, the same route. Besides them, up from the city come, in further duplication and longer distance waste, the wagons of the nine different New York department stores that deliver in Yonkers, the wagons of the four local express companies that divide the “independent” business, and those of the two general express companies which do the high-priced long distance business. Yet, when you think of it, one wagon could come to you three times a day and do the work of all these people, more effectively and at one-tenth of the present total expense.

You buy a dollar’s worth of groceries of John Jones, the grocer. The whole package, bread, milk, eggs, butter, and vegetables, weighs, perhaps, ten pounds. A company doing all the delivery business of a town, centralized, complete, without waste labor or waste mileage, stopping its motor wagons two or three times a day at every house on every street, can make money delivering that ten pounds for six cents. It now costs Jones, sending out his boy and wagon to a dozen odd houses scattered all over town, two or three times that amount.

But such a private parcels post will not be undertaken because of the fear that the government may enter the field. Yet so far at least, although in the post office the government has most of the plant necessary to carry on such a business, it cannot be persuaded to go into it.

The most exasperating reason for this inactivity is the legislative assumption that our present “parcels post” approaches perfection. The fact is, of course, that the United States has no parcels post in the sense in which the term is in accepted international use. The present fourth class rate is but little used in this country simply because it is prohibitively high. To send ten pounds of merchandise from New York to Philadelphia involves, not merely the indefensible nuisance of separating it for mail transportation into three packages, but a charge of $1.60. Naturally, instead, the merchandise is sent in one parcel by express for fifty cents. As the work done by the express company, it is needless to note, gives them a very handsome profit indeed, it is evident that by far the larger portion of the government’s $1.60 in this case would be sheer profit—if the post office were as efficiently conducted as the express company.

The express company, however, does not attempt to carry a ten pound package from New York to Seattle for fifty cents. Such long and profitless hauls they leave for Uncle Sam. Yet, even so, with all the cream of the parcel business continually and inevitably going to the express companies, the Post Office Department according to its reports makes a profit in its “parcels post” business.

Of course were the post office rate from New York to Philadelphia a real parcels post rate, that is, for example, 20 cents for ten pounds instead of $1.60, there would be 1,000 pounds of merchandise so sent where there is one sent today. People will use a parcels post when it becomes cheap enough to be an economic possibility, and they will use it enormously, as experience elsewhere has abundantly and conclusively proved. Until then they will use the fourth class postal rate only for the occasional cross continental parcel on which the express rate soars out of all reach, or for the small parcel under a pound in weight on which the fourth class rate is less than the express companies’ minimum charge.

The four vital arguments (the four great express companies) against a parcels post, once so succinctly enumerated by Mr. Wanamaker, and the other hoary arguments sampled above, have, however, of late years been bolstered by another—the welfare of the “small country retailer”; and round the great fear of a vague but very horrible something called “trade centralization” the battle for parcels post is at present being waged.

It has been taken for granted that the small country retailer will be put out of business by the parcels post with its low delivery charges—yet there are stores in Yonkers, Plainfield, etc., in spite of the fact that the New York department stores deliver in these places free.

Let us examine another aspect of this death-of-the-small-retailer-fattening-of-the-mail-order-trust-bogey a minute, and see whether a parcels post means really a more centralized basis of distribution, or a less.

Speaking very roughly, there are in the world two great tides of merchandise traffic: one of raw materials, of which food products is the most important, from the farmer to the urban consumer; one of manufactured products—to wear, to use, or to eat (as refined sugar or prepared breakfast food)—from the urban maker to the farmer consumer.

Surprising as it may seem the parcels post argument has dealt almost entirely with the latter tide: of the former tide, even more important, as I think I can show, very little has been said.

Let us look for a moment into our existing high cost of transportation, and therefore, decentralized distribution of farm products.

In New York the farmer sells his milk for—these figures are quoted very roughly and without elaboration but they will give my point—2 cents a quart. He sells it, usually, to one of two or three—there is considerable evidence that they all act in agreement as one—gigantic milk companies (of which Borden’s is the largest) which bring it into the city and distribute it. The ultimate consumer—again I give a rough figure—pays 10 cents a quart. The other 8 cents is the “distributing cost”; and in each case it goes, mind you, to two great corporations, a milk company and an express (or a rail-road) company. Is this that decentralized distribution that the defenders of the express companies in and before our Committee have eulogized.

Take almost any other farm product, strawberries, for example. The farmer, who grows them, gets 3 cents a basket. Then begins a long line of tolls: the express company, 3 cents; the commission merchant, 2 cents (he claims, and often with reason, that his “spoilage” is high); the jobber 1 cent; the small retailer—delicatessen store, corner grocery or street cart vendor—3 cents (it “costs 25 per cent. to do business” he says, and it does too). The ultimate consumer pays 12 cents a basket, sometimes more, sometimes, when the market is glutted, a little less. Here is 9 cents of “distributive costs” of which but 3 went to our friend, the “small retailer.” The rest went to more or less centralized distributing agencies. Now suppose on the other hand that the farmer could send his products direct to his list of regular customers in the city. It would be perfectly feasible with a parcels post. Strawberries, which the farmer would get 6 cents a basket for (double what he gets now) could be delivered at your breakfast table the next morning after picking instead of two or three days old in the triple transit of commission merchant and his storage place, jobber and his trans-shipment, retailer and his store, and finally to you. And for this infinitely better article you would pay only 8 cents (2 cents for the parcels post) instead of the former 12.

There are only three factors, the farmer, the government parcels post, and you! This is not theory: it is being done in England, in Germany, in Japan, and in almost every other civilized country in the world every day; and has been done for years.

And as for the mail order business bogey, it would not be a bogey in the country districts because every farmer would be running a little mail order business of his own, shipping his eggs and butter pats and comb honey and fresh fruit and vegetables by mail right to his customers, on their standing or postal card orders, getting enough for his produce to make small farming worth while, but giving the consumer better goods at a big saving. Cost of living! There is no other revolution in the methods of distribution that would make so much difference in the cost of living as a thoroughgoing parcels post would work. And instead of greater centralization it would be almost the ultimate of trade decentralization.

Or, let us look at the thing the other way round. What is the chain of trade from urban producer of manufactured articles to the country retailer and consumer? Is there any decentralized purchasing now except by mail? The farmer buys of the small retailer. But the retailer buys of the lesser jobber and he of the main jobber and he of the manufacturer; and this is true whether the product be canned goods or dry goods. Freight shipments in bulk can underbid single shipments by mail or express; and the present system of distribution, cumbersome and expensive as it is to the ultimate consumer, is nevertheless cheaper than direct single shipments at the present mail or express rates. The moment that you introduce bulk shipments into any distributive system you necessarily introduce a middleman somewhere to divide up that bulk shipment for individual consumers; and the greater the bulk economically shipped the more middlemen there will be between producer and consumer.

Now where the parcels post could afford a cheaper way of doing the distributing than the machinery at present in use, the people ought to have the benefit of it; but in spite of the obvious benefits of a parcels post it is not wise to jump to the ultimate conclusion. No one would be rash enough to say that the present system of retail selling is entirely wrong. Even if the flat-rate, “zoneless” parcels post were established there are certain kinds of goods—books, for example, in which every article is a “novelty” which must be personally handled before choice and purchase, in which a local retailer with a display is, if not essential, at least a great convenience.

But so far we have been considering an ideal, flat-rate parcels post, without that “zone” provision which is an important provision in the bills and proposals for a parcels post which are now being most actively agitated.

The zone system of parcels post proposes, roughly, a flat rate per pound and per additional pound within the limits of any delivery office (that is a service which involves no transfer from one post office to another) and a rate considerably heavier (but still much less than the present fourth-class mail or express rate) for delivery elsewhere in the United States. This would furnish the cross-roads store with a most convenient delivery system and furnish it at a cheaper price than its city rivals could secure it. The local retailer would have the advantage of the difference between the two charges. To give this advantage to the local retailer is probably wise from the standpoint of general public policy. The small retailer in the country does the public a very actual and very valuable service. To have a stock displayed for selection is often an assistance in purchasing; there are certain things which cannot in any case, be bought by mail; there are other things which may sometimes preferably be bought direct, just as most people like, occasionally at least, “to shop”; there is a welcome personal touch in retailing which is lost in the long distance purchase. For these and other reasons the retail store will remain, stripped of overcompetition and non-essential distributive agents, competing with the parcels post, not in price so much, as in the kind and quality of service. That is the way the small retailer in Germany had adapted himself to the parcels post; and although in his case there is no zone preferential to aid him, he has made good.

After all, there is the gist of the answer to those who oppose a parcels post on anti-centralization grounds. They speak as though there were but one factor in retailing—price. As a matter of fact there are many factors, and the best students of retailing methods consider service one of the most important. With a parcels post established the public would be getting value for its money in cheapness or service, as it chose; with the present express system it gets neither.

Congressional Record. 46: 1941-7. February 3, 1911.

Star Routes and Rural Parcels Post.

F. W. Mondell.

I do not want to put the entire blame for the hidden, circuitous, and indirect opposition to parcels post upon the express companies. There is another class of people who are opposed to parcels post who do not directly show their hands. They are the firms and corporations who send out a very large letter mail, upon which they pay 2 cents for every half ounce. The average citizen who only writes an occasional letter does not realize how heavy the burden 2-cent letter postage is to people who send out great numbers of letters.

There are many large concerns, like the mail-order houses for instance, promoters, jobbers, and dealers in special extensively advertised lines, whose actual letter postage amounts to many thousands of dollars a year. Such people naturally oppose any change in the postal service which might increase the postal deficit, even temporarily, because of their anxiety to have the letter rate reduced. The yearly income of the Post Office Department from letter postage is about $132,000,000, and it is said that some mail-order houses pay several hundred thousand dollars a year for letter postage. A reduction of that by half would be well worth working for.

It would not be fair in the discussion of this subject to overlook the fact that there are arguments against the establishment of a general parcels post which are advanced in perfect good faith and which are entitled to serious consideration. Those local merchants who have some misgivings about the matter are entitled to have their views carefully considered, but as I have indicated, it is my opinion that in the main their fears are not well founded, and arise largely from the fact that they have not had an opportunity to give the matter their personal consideration, and therefore have been inclined to accept the arguments of interested parties. There are also a considerable number of people who are honestly opposed to the parcels post in the belief that it is an unwarranted extension of government activities into a field which ought to be satisfactorily covered by private enterprise, and who still hope that the express service may be so cheapened and improved as to very largely satisfy the demand for a parcels post. There are also those who feel that owing to the vast area of our country it would be difficult to adopt a system of parcels post which would be generally satisfactory and at the same time self-supporting.

The argument is also made that the handling of a large amount of merchandise by the postal service would make delivery difficult where city delivery is provided, and delay the transmission of letters by the loading of the mails with merchandise.

These arguments do present problems which must have serious consideration. They are none of them, however, in my opinion, problems which are insurmountable, but a consideration of them, as well as of that character of powerful opposition exerted indirectly to which I have referred, leads thinking people to the conclusion that the outlook for the establishment of a general parcels post in the country in the near future is far from promising. With this as with all progressive legislation, little progress will be made until the people as a whole become thoroughly interested in the subject, quite generally make up their minds what they want, and in no uncertain tone make their wants known.

So long as only those who are opposed to the extension of the parcels post are generally heard from by members of Congress, there is not much likelihood of definite action being taken, and the probability is that in any event a general parcels post in this country can only be secured through the medium of a modest and limited and more or less experimental beginning in the way of a local or rural parcels post.

Local Parcels Post

President Taft in his last annual message recommended a parcels post limited to rural free-delivery lines. This recommendation was made on the ground of economy, to meet the opposition aroused by the argument that a general system would create a great deficit in the postal revenues, for a time at least. The local system would also have the virtue that it would furnish an object lesson in a partial and limited way, which might be valuable in determining the propriety of further extending the system. There is, furthermore, an argument for rural parcels post which does not apply in the same degree to a general parcels post, and that is that while the dwellers in cities and towns have ready access to stores and opportunities of express service, the dwellers in rural communities do not have these advantages, and therefore a rural parcels post which would enable them to have articles delivered on local routes or to local post offices would be of great benefit and advantage to them. As we do not have many rural free-delivery routes in our sparsely settled intermountain country, I am of the opinion that a rural parcels post, if established, should also operate over the star routes which supply our country offices and our people in boxes en route, and therefore the bill which I introduced provides for such a service.

Such a rural parcels post as is thus proposed would unquestionably be helpful in building up the trade of the merchants in the small cities and towns and of very great value and advantage to the people who get their mail at the country post offices and along country routes. This being true, I supposed I would avoid much of the storm of opposition which those who have advocated a general parcels post have heretofore encountered. Much to my surprise, however, the onslaught against this very modest proposition, intended to help the local merchant and the people of the country, has been even more terrific than the outburst against the general proposition; all of which makes one fact as clear as the noonday sun, and that is that the opponents of a parcels post realize that the local parcels post, if it works well and is generally satisfactory, will be the entering wedge for the general parcels post. It also illuminates quite as clearly another fact, and that is that the opponents of parcels post believe that the rural parcels post will work well and be generally satisfactory. Another important fact emphasized by this opposition is that the opponents of parcels post believe that the agitation for a local parcels post is much more dangerous than the agitation for the general parcels post, because it is more likely to be successful. The gentlemen who have been spending their money so liberally in opposition to the local or rural parcels post have thus made clear three important facts:

First. They believe that there is a strong probability of a local parcels post being established.

Second. They believe that such a system will work to the satisfaction of the people.

Third. They believe that, the local system having proven satisfactory, it would lead to the establishment of a general system.

In this condition of affairs it would seem that it is the duty of the friends of a parcels-post system to get behind the President’s suggestion of a local parcels post enlarged so as to include star routes and country offices.

Some one is spending a lot of money to defeat the rural parcels post. One way they are doing it is by sending out petitions by the tens of thousands, which they ask the local merchants to sign and send to their Congressman. I have received hundreds of these petitions. They have various sorts of headings printed in various kinds of type, but they are nearly all alike.

After having in the first paragraph drawn a dreadful picture of the awful disaster and destruction which the rural parcels post will bring to the farmers and to the country towns, in whose behalf they weep and wail—a destruction compared with which the devastation of Sodom and Gomorrah would be as the passing of a summer zephyr—they tell us how all these direful calamities are to come, as follows:

In every town catalogue agents of mail-order concerns would establish themselves. They would need no stores, pay no rent, employ no clerks, require no credit and give none, and carry no stock. Their whole time would be devoted to soliciting orders from catalogues. The merchandise would be shipped to them by express or freight from the retail mail-order houses in the large cities. When received it would be deposited in the local post office and the packages delivered by the rural carriers.

The only trouble with this lovely piece of sophistry is they fail to explain to us why the very game they describe can not be worked just as well now as it could after a rural parcels post had been established. There is nothing in the world to prevent just the sort of a plan, which is thus held up to our horror and execration, from being carried out now, except that it would not pay. The mail carriers on rural and star lines not only have the authority, but they would be very glad to have the opportunity of delivering packages along their routes which solicitors for catalogue houses might deliver to them. And, furthermore, they can now, no doubt would be glad to, take packages of any size; whereas a rural parcels post only provides for packages up to 11 pounds. So, when you come to analyze it, this “local-solicitor-of-the-mail-order-trust” bugaboo is found to be just another one of the strawmen, the poor miserable scarecrows, that the express companies are trying to terrify us with.

The mail-order houses claim they can sell cheaper than the local merchants because they do not have any local expense. The moment they are called upon to pay for the services of a local agent their expenses are greater than those of the local merchant. I think this disposes of the “local-agent bogy.” He is the most transparent of all the scarecrows the express companies have raised.

Congressional Record. 45: 9310-4. June 24, 1910.

General Deficiency Bill.

William S. Bennet.

Mr. Speaker: In view of the great interest in the parcels post question, I submit herewith the views of the Farmers’ National Congress:

A Brief for a Modern Parcels Post for the United States

[By John M. Stahl, legislative agent Farmers’ National Congress.]

It has been said, and not without justice, that because of greater density of population parcels can be carried at a less cost in the domestic mails of Germany or Belgium than in the domestic mails of the United States, because the average haul would be shorter in Germany or Belgium. But the disparity between the domestic parcels post of the United States and of foreign countries is greater than is warranted by the length of the average haul. No fact is better established in the science of transportation than that the cost of transporting an article bears little relation to the distance transported. But if the density of population should fix the rate of postage and the limit of weight in a domestic parcels post, then surely we should have a lower rate of postage and a higher weight limit than those countries in which the population is not so dense as is ours. For example, the area of the Commonwealth of Australia is 2,974,581 square miles, and the present population is 4,300,000. The area of the United States, excluding Alaska and the islands, is 3,025,600 square miles. Alaska and Hawaii would add a shade less than 600,000 square miles. The area of the Philippine Archipelago is 832,968 square miles, and the population, according to the 1908 census, is 7,835,436. It is certain that, including all our territory and all our population, we have an average population of more than 20 per square mile. Australia has a population of less than 2 per square mile. If the argument of the opponents of a modern parcels post for the United States, founded on the density of population of Belgium, Germany, etc., is a good argument, then the rate charged in our domestic parcels post should be much less and the weight limit should be much greater than in the domestic parcels post of Australia. But the postage rate in the domestic parcels post of Australia is as follows: Intrastate, 1 pound, 6 pence (12 cents); 2 pounds, 9 pence (18 cents); 3 pounds, 1 shilling; and 3 pence (6 cents) for each additional pound up to and including 11 pounds, the postage rate for an 11-pound parcel being 3 shillings (72 cents).

The interstate rate in the parcels post among the six states of Australia is as follows: One pound, 8 pence (16 cents); 2 pounds, 1 shilling 2 pence; 3 pounds, 1 shilling 8 pence; and 6 pence additional for each additional pound up to and including 11 pounds, making the charge for an 11-pound parcel 5 shillings 8 pence ($1.36).

New Zealand is 1,200 miles from Australia and extends for 1,100 miles. It has a population of only 1,000,000. Yet the rate in the parcels posts between the States of Australia and New Zealand is just the same as it is among the States of Australia, and the weight limit is the same.

Now, if the people of Belgium and Germany should have a less postage rate and a higher weight limit in their domestic parcels post than we have because the population of Germany and Belgium is denser than our population, then we should have a much less postage rate and a much higher weight limit in our domestic parcels post than have the people of Australia, because our population is more than ten times as dense as the population of Australia. But, on the contrary, the average postage rate in not only the intrastate but also in the interstate parcels post of Australia is less than in our domestic parcels post, and the weight limit is 11 pounds, as compared with 4 pounds in our domestic parcels post. The rule laid down by the opponents of a modern parcels post for the United States must apply to Australia as well as to Belgium and Germany, and by this rule the rate in our domestic parcels post should certainly be less than 8 cents a pound and the weight limit should certainly be far above 11 pounds.

The postage rate in the domestic parcels post of New Zealand is 4 pence (8 cents) for the first pound and 2 pence (4 cents) for each additional pound. The population of New Zealand is less than one-half as dense as our population. The weight limit in the domestic parcels post of New Zealand is 11 pounds. If the argument of the opponents of a modern parcels post for the United States, founded on the density of population is correct, then the rate in our domestic parcels post, instead of being several times that of New Zealand, should be less, and the weight limit, instead of being only about one-third that of New Zealand, should be greater.

Our parcels post with foreign countries shows beyond argument that the postage rate in our domestic parcels post should be not more than one-third of what it is, at the utmost, and that the weight limit should be several times what it is. The domestic parcels posts of other countries and of Australia and New Zealand show also beyond argument that the postage rate in our domestic parcels post should be only a fraction of what it is and that the weight limit should be several times greater.

Whether or not the railways are owned by the government does not touch the argument founded on the parcel post of other countries. If government ownership of railways lessens the cost of the postal service, it may be an argument that our Post-Office Department pays our railways too high a rate for transporting mail matter, but it has nothing to do with the character of the mail service our government should give our people.

As a matter of fact, government ownership of railways has no apparent effect on the parcel post of foreign countries. Both those in which the railways are in large part owned by the government and those in which the government does not own any railway mileage have a parcel post much superior to ours.

Possibly our government should not conduct a parcel post at any considerable loss, although it should be borne in mind that the object of our Post-Office Department is to serve the people and not to make money. It might be successfully argued that fundamentally there is no greater reason why the Post-Office Department should be a source of revenue than that the War Department should be a source of revenue. The mails have become so very important in the transaction of business, in the communication of intelligence, and affect so many of the operations of our daily life, that each year it becomes apparent that the test of our Post-Office Department should be the excellence of the service it gives our people; and the relation of expenditures, so long as they are judiciously and economically made, to receipts is of less and less importance. But we would not advocate any parcel post that, when fully established and on a normal basis, would add much, if any, to the net cost of our Post-Office Department. However, it is apparent from a study of the profits of our express companies that our Post-Office Department could carry parcels in our domestic post at a much less rate than 16 cents a pound without increasing the net cost of the Post-Office Department. Further, a study of the profits of our express companies show clearly that we are being charged altogether too much by these express companies for the service they give us, and that their charges should be subjected to that most effective of all control—the competition of a modern parcel post. This study shows with equal plainness that the present weight limit on parcels in our domestic post, which compels us to send by express all parcels weighing more than 4 pounds, should be raised to a much higher figure, probably 25 or even 100 pounds. Recent investigations and revelations have shown that our express companies are really subjecting us to extortion.

The competition of a modern parcels post may not prove sufficient of itself to make the charges of the express companies what they should be, but it would certainly be most effective in accomplishing this result. We are subjected to overcharges by express companies as are the people of no other country on the face of the earth. In fact, the most important countries of Europe, as well as Australia, New Zealand, etc., are not subjected to any overcharges at all by express companies for the reason that in those countries and colonies there are no express companies of the nature of those existing in this country. On account of the overcharges of our express companies we have a very good reason, indeed, for a modern parcels post in this country; and this very good reason is in addition to those that so many other countries have found amply sufficient to warrant a modern parcels post.

And it should not be forgotten that the enormous profits of our express companies on the capital they actually have invested in the express business show conclusively that our government could give us a modern parcel post without increasing the net cost of the postal service after that parcel post had been established and its business had reached normal proportions.

In an honest endeavor to arrive at a correct conclusion as to the features of our domestic parcel post we can not do better than to study the parcel post of Australia and New Zealand, for the dominant elements in the population of Australia and New Zealand are the same as in ours, the people of Australia and New Zealand have obtained their ideas of government and the functions of government from the same source that we have, their institutions and conditions approach ours nearer than those of other countries, and they have the same problem of adapting the government service to a wide expanse of territory in the settlement and development of a new country. This problem, though much greater than ours at this time—the area of Australia is nearly the same as that of our states, while the population is only about one-twentieth as much—is the same in its nature.

Another reason is that the postal service of Australia and New Zealand is so satisfactory in every way. On page 25 of “L’Union Postale” for 1909 it is stated in regard to the New Zealand postal service: “The financial results of the administration were very satisfactory. The receipts increased by 9.04 per cent and the expenditure by 7.22 per cent over the preceding year.”

It will be seen that the postal business of New Zealand conforms to the rule of good business management that as a business increases in volume the receipts should increase faster than the expense.

In the last published report of the postmaster-general of New Zealand it is pointed out that notwithstanding several important reductions in the postage rate the revenue of the postal service had during the preceding sixteen years increased by a considerably larger amount than the expense. “From December 16, 1907, the postage on inland post cards was reduced to one-half penny. From January 1, 1908, the rates for inland letters were made 1 penny for the first 4 ounces and one-half penny for each additional 2 ounces. From January 1, 1908, the commission chargeable on money orders within New Zealand is 3 pence for each 5 pounds sterling or fraction of 5 pounds. Owing to the reduction in postal rates made the year before, the number of parcels increased 81.57 per cent.” “The rate of postage for inland parcels was reduced from 6 pence for the first pound and 3 pence for each additional pound to 4 pence for the first pound and 2 pence for each additional pound. The public, moreover, has by the change been induced to send by parcels post articles which were previously forwarded as packets.” “The reduction in postal rates may be practically referred to as having resulted in a great increase in parcels-post business.” There was a handsome net balance to the credit of the postal business. “The net balance on the year’s transactions would be much higher if the value of official correspondence dealt with were taken into account.” “The expansion of the business has necessitated large additions to the staff. The increase of the staff was, however, below the percentage of increase of the receipts. An amendment to the post-office act contributed to improve the financial condition of the postal service.” The experience of New Zealand and the Commonwealth of Australia in postal service is well stated by the colonial treasurer, Hon. Sir J. G. Ward, in one of his recent financial statements, as follows: “Experience has shown that every concession in postal rates creates a new class of business which is ultimately to the profit of the post-office.”

Of course, in the official publications of the Commonwealth of Australia and of New Zealand one hears nothing to the effect that the government should not engage in any competitive business—one hears that only in the United States. If that were put into effect, our national government would be compelled to stop building war ships in the navy-yards, to close up altogether the government printing establishment, to stop at once all its irrigation projects, to close up all the land-grant colleges, to stop at once casting cannon and making small firearms and ammunition, etc. As a matter of fact, when our Constitution was framed there was no question among those that framed it that it should give to the national government the power to do certain things, in competition with private enterprise, that would be for “the public welfare;” and there was never any intimation that the national government should not engage in any competitive business. On the other hand, those that helped to frame the national Constitution and to secure its adoption participated in and sanctioned legislation by Congress that put the national government into several lines of competitive business.

The publications of the labor officials of Australia and New Zealand are decidedly numerous, and show plainly that the working people of these colonies, as well as the other elements of their population, are heartily in favor of a modern parcel post. It may truly be said that the parcel post of Australia and New Zealand has the hearty and universal approval of the people of those colonies. The officials and the rank and file of the labor organizations of these colonies are among the heartiest supporters of their parcel post. And it is certain that the very large majority of the rank and file of our labor organizations and the very large majority of our city people, as well as of farmers, heartily favor a modern parcel post.

As for the relation of a modern parcels post to the so-called catalogue houses: In his official reports the postmaster-general of both Australia and New Zealand frequently emphasizes that for years a thoroughly modern colonial, intercolonial, and foreign parcels post has been enjoyed by the people of those colonies, even in “the most remote districts to which the mail service penetrates.” Notwithstanding this, in all of the many publications on Australia and New Zealand, or by the officials of those colonies, there could not be found a sentence to the effect that the local merchants of those colonies have been in the least injured in their business by catalogue houses.

This fact certainly merits being emphasized. In all the countries in which there is a modern parcels post the catalogue house is unknown. In our country, which is the only enlightened country that has not a modern parcels post, the catalogue house exists and, to some limited extent, flourishes. Hence the fact is plain that instead of a modern parcels post aiding catalogue houses the very opposite is true. If the universal experience of humanity counts for anything, then the antiquated parcels post, such as we have, aids the catalogue house and the modern parcels post puts it out of business and keeps it out of business.

The rural delivery service has grown to more than 20,000 routes. Official reports show that the average weight of mail delivered by each team or single-horse wagon in the rural delivery service is only 25 pounds. On nearly all the trips the carrier could practically as well take 500 pounds in his wagon. The more than 40,000 rural carriers make more than 12,480,000 round trips each year. If a parcels post on the rural routes earned $2 for each round trip the gain would be, in round numbers $25,000,000 a year, and this, with some little reforms that all agree should be and easily could be made, would wipe out the postal deficit. Now, if the rate on the pound packages in a rural route parcels post was 5 cents a pound the carrier to earn the $2 per round trip would be compelled to carry not the 500 pounds that he could, but only 20 pounds additional going and coming or a total load of only 45 pounds.

This is a fair calculation as to profit to the government, for the expense for the rural carrier service would not be any greater whatever, and the small expense for handling the additional 20 pounds at the terminal post-office would be more than covered by the increased first-class mail (handling which is very profitable) resulting from the parcels post.

As, on the average, about 100 families are served by each rural route, if, on the average, each family had delivered or sent each trip only one-half pound of parcel, taking into account that a good many parcels would weigh less than 1 pound and that every parcels-post bill proposes for them a higher rate than for heavier packages, the rate could be made much less than is proposed and yet the postal deficit would be wiped out altogether!

And this would be of very great benefit to the 4,000,000 families served by the rural mail delivery. The rural carrier passes the farm every week day, yet if the farmer wants a package from the town he must go after it—each of the 100 farmers must hitch up and drive to town and back for packages that the one carrier could have brought them as well as not with the outfit that he already has. Or these 100 farmers must hitch up and take to town packages that the carrier could have taken for them with the outfit he already has. The time and labor saved the 4,000,000 families on rural routes would amount to many times the present postal deficit.

It is only natural that farmers should be especially desirous of a modern parcels post, because, as already stated, the express service stops with the railway station. Hence the farmer has no express service that reaches to him as have the people of towns and cities. The express companies have never cared to carry their business to the farmer, and this must convict them of only the most reprehensible motives in opposing a parcels post limited to rural routes, which would extend the equivalent of an express service to the farmers. As bearing on the farmer’s need of a modern parcels post, the following from a letter just received from Hon. W. L. Ames, Oregon, Wis., a practical farmer and a leader of national reputation in all agricultural movements, is of interest:

“One of the things we most need is better and prompter transportation facilities for rather small articles. I recently needed a small but important repair for a machine. It weighed 4¼ pounds. It cost 55 cents. The express company charged 45 cents to bring it to Oregon—200 miles. The charge was altogether too high, but what I felt most disposed to complain about was that it took a week to bring the repair to me. Mail matter moves promptly; but the express company knew that it was certain of the job of carrying that repair to me, hence no need of haste on the part of the express company. We need better and added facilities for the prompter moving of such merchandise. Present delay is a serious handicap, and undoubtedly a parcels post would give us prompt service at a less rate, as it would not be expected that the parcels post would do more than make a moderate profit for the government, whereas the express business is a constant ‘melon-cutting’ business. We must not forget, also, that all the equipment for a parcels post on rural routes is already installed.

“If the government would take charge of what it already has and add rules to fix charges for carrying parcels on the rural routes, it would relieve us of much unjust charge and also much annoyance and loss of time. Under the rulings of the Post-Office Department prohibiting rural carriers from acting as agents for anyone to obtain business, carriers are afraid to carry parcels to any extent. But what cuts a yet greater figure is that no rule can be established to fix the charges for carrying parcels and make them the same for all. Each person on a rural route and the carrier cannot dicker for the transportation of each article. That would soon lead to great dissatisfaction, as some would think that others were being favored. And to dicker on each parcel would take so much time and be so much trouble that the carrier could not be expected to do it. All we need to put into effect a modern parcels post on the rural routes is a law fixing a reasonable and proper rate for the transportation of parcels and making it the business of the rural carrier to handle parcels as well as the mail matter he now carries.”

Cosmopolitan. 36: 497*-9*. March, 1904.

Who Will Be Benefited by a Parcels Post?

John B. Walker.

Those who have been appointed to defend the Post-Office Department in the sacrifice it has made of the American people in the matter of postal parcels delivery have replied to the argument in the last issue of The Cosmopolitan by claiming that but very few people will be benefited by a parcels delivery equal to that of Germany. It is therefore necessary to consider this question: “Who are the people who will be benefited?”

First. There will be a gross saving amounting to more than two hundred and fifty millions of dollars per annum. This annual addition to our national wealth constitutes an economic factor of the highest importance.

Second. While this sum will be distributed equally among the people in proportion to their purchases—especially among those who make small purchases—the direct benefit will be first appreciable in the business of the following classes:

I. The Small Storekeepers of the Country Towns and Villages. One of the arguments used by those who have been placed in the Post-Office Department for the protection of special interests, is that a parcels post would injure the country storekeeper. The very slightest consideration of the problem, however, would have shown that no one is so likely to be its beneficiary as he. The chief difficulties with which the small merchant has to contend are these:

1. Insufficient capital.

2. Distance from wholesale centers.

3. Cost of expressage on small parcels.

The country merchant has the acquaintance of his customers; he knows their wants and enjoys their good-will, and would have their patronage if he could be placed in a situation where he could give them equal, or approximately equal, advantages with a merchant who buys on a large scale. If one of his customers is driven to go elsewhere, it is not only because the merchant cannot afford to keep in stock the particular class of goods desired, but because he cannot afford to ship these goods in small quantities, on account of the prohibitive rates of the government’s postal parcels charges of sixteen cents per pound, or the almost equally prohibitive rates of the express companies.

The country storekeeper has the experience of his customer’s wants, and he has a knowledge of the best goods, knows what is a fair price for an article. He is in a position to advise his customer as to his needs, and if he were not handicapped by lack of capital and cost of transportation for parcels, he could, in nine times out of ten, supply the wants of the customer.

In addition to the trade he has now, the country storekeeper would, with the advantage of a first-class postal parcels system, be able to keep in touch with all the great wholesale distributing agencies of the country. He would earn a reasonable commission on all goods ordered, and would be in a position to secure, within a very brief time, by postal parcels, the goods which the customer, after looking over the catalogues and receiving the advice of the merchant, should decide to order.

There would be no investment and no risk, such as is involved in carrying a stock of goods which may become unsalable. Without large capital, he is now handicapped by being compelled, on account of the discrimination against him as a shipper, to lose the sale of all those articles which he cannot carry in stock in quantities, and which may, under present arrangements, only be shipped in bulk. If he attempts to use the mails, the rate of sixteen cents per pound is prohibitive, while the fact that the bulk is limited to four pounds is almost equally so; and the express companies’ charges are so high that in the majority of cases he cannot utilize their services.

Let us suppose that, instead of the United States’ charges for postal parcels being six thousand per cent. greater than Germany’s they were on a par, and that the country merchant could receive parcels weighing from one ounce to one hundred and eleven pounds for a quarter of a cent a pound. It is not even necessary that the rate should be so low. Let it be made four times as great as that of Germany, or one cent per pound, and let us see what advantage the country merchant would have. One hundred and ten pounds covers nine-tenths of the articles which he would be likely to sell. Instead of a store equipped with comparatively few articles, the country merchant would be able to carry, in addition to his regular stock, an extensive line of samples. He would familiarize himself with the best that there is in the market, be able to advise his customer to his advantage, and then, receiving the order, could, within a brief time, have the goods sent by parcels post directly to the customer’s home, saving the expense of handling two or three times—making more money by a small commission than he does now by the larger margin on the goods which he is compelled to carry constantly in stock.

Good organization is the trend of modern business, and this is good organization—saving two or three handlings, truckage, some bookkeeping, et cetera.

II. The Manufacturers. Next to the country merchant, the manufacturer will be the largest beneficiary of the postal parcels delivery. Take, for instance, the hardware business. The manufacturer is obliged, under the existing conditions of trade, to maintain large stocks in an endless number of cities scattered over the country, or do what is the equivalent of directly maintaining the stocks—that is, to give extended credit. This is because there is no way of handling small parcels of hardware without a cost that is so excessive as to force shipments of hardware to be made in bulk. With a one-cent-per-pound rate, more than fifty per cent. of the stocks now carried could be eliminated and orders sent by the hardware merchant directly to the manufacturer to be shipped by package. One hundred and ten pounds would cover the greater portion of the trade, and leave only nails, barbed wire, and similar articles, for bulk handling.

In cotton goods, instead of shipping from the Mills to New York, trucking them there through the streets, breaking bulk, repacking, retrucking and reshipping to the merchant there would be but one operation. A single piece of goods would go direct from the factory by parcels post at a total cost for handling not to exceed twenty per cent. of the charges now engendered by our clumsy, costly and inconceivably stupid method.

The same thing would happen in the grocery business. A factory in Rochester or Pittsburg, manufacturing canned articles, must ship in bulk to New York, or Chicago, or St. Louis. There the car-load, after being hauled to a warehouse, is broken up and transshipped. There is no reason for this transshipment, no possible excuse for this waste of money, except that the ownership of the express by a few private companies has prevented the organization of a parcels post upon lines which have long been recognized as absolutely successful in Europe.

The question here will be asked: Would this shipment direct from the factory interfere with the business of the wholesale merchants whose task it is now to repack and reship? On the contrary, it would simplify their work and reduce expenses from every point of view. Their business primarily is one of distribution of credits. They have certain customers who receive from them certain lines of credit. They furnish the capital between the manufacturer and the retail dealer. If tomorrow they could order by letter or telegraph, directly from the factory, for shipment to the retail dealer by postal parcels, their business would be greatly simplified and their profits increased.

III. The Merchants in Large Cities. Perhaps to no class will the boon of a parcels post be greater than the merchants in the large cities. All the way from four cents to fifty cents is now paid for the delivery of a parcel within a radius of thirty miles around the leading cities of this country. Experiments have shown that it is possible, where the interests of a considerable number of merchants are combined, to deliver an average dry-goods parcel, thirty miles out, at a cost not to exceed four cents.

As conducted today, the business of delivering parcels consists in sending the wagon of one dry-goods house to follow another into a city block, and deliver each its parcel; then each wagon goes off to another block, and delivers its parcel. In New York city thousands of wagons meander through the two or three thousand miles of streets, each firm doing its work independently of the others, and each wasting money by lack of cooperation.

It is altogether probable that with thorough organization city delivery could be conducted, within a radius of thirty miles, upon a basis not to exceed one half cent per pound. This would mean but two cents per package for the average four-pound dry-goods parcel, including, of course, the large number which are transported but a few blocks. But that is not the only advantage. It would take from the merchants the constant effort which the maintenance of good delivery systems involves. I have personally studied the delivery systems of nearly all the leading merchants in New York, Philadelphia, and Boston, and have spent a day in the delivery department of Marshall Field in Chicago. Everywhere I heard the same complaint—that the brains consumed in managing the parcels delivery was one of the most expensive items in the cost of operating a great establishment.

IV. Book Publishers. The cost of delivering a book by mail is now eight cents per pound. This, for a four-pound book, means a tax of thirty-two cents. Just how far this retards the development of intelligence in the people is not difficult to estimate.

V. Stationers’ Supplies. The large class of manufacturers and wholesalers who are engaged in supplying the stationery trade would find the parcels post a great convenience in receiving supplies and in delivering to customers; a matter of lessened capital, lessened trouble, and greatly increased profits.

VI. The Railways. At first sight it might appear that the interests of the railways would not be favored by a postal parcels law. But the briefest analysis of the problem shows that the benefit to them would perhaps be greatest of all.

To-day vast numbers of freight-cars stand idle, waiting carload shipments. These bulk shipments are necessarily made at the very minimum of cost. In the low price of bulk shipments, American railways lead the world. Even at existing prices, however, water transportation carries off a large part of the burden.

The benefits to the railways, by transferring freight from the class of bulk to parcels, would be:

1. Goods being shipped in a constant stream of packages, instead of intermittently by car-load or train-bulk;

2. A higher price would be obtained from shipments of the same freight in parcels as compared with the previous cost in bulk;

3. The large increase in traffic due to better, cheaper, speedier and more direct, and in every way infinitely more convenient, facilities;

4. The additional prosperity which a saving of anywhere from two hundred and fifty to six hundred millions of dollars per annum would mean to the country at large.

There are to-day far-seeing railway officials who have given this problem serious consideration, and who have arrived at the conclusion just stated.

VII. The Farmer. Last, but not least in importance, comes the farmer. To-day, cut off from parcel delivery, he is the victim of bad government, both in his bad roads and lack of postal facilities. The one step of progress that the United States post-office has made of recent years, that is worthy of respect, is the rural postal delivery. As proposed, however, it is ridiculous. The idea was advanced by some politicians for the purpose of creating additional patronage. Merely to deliver letters and newspapers to the farmer would, of course, be to operate a service without hope of placing it on a profitable basis. It would be as if the New York merchants would keep a thousand wagons traveling around the streets of New York to deliver nothing but kid gloves and lace veils—nearly empty, while other wagons would be carrying the burden of the goods sold.

Rural free delivery is absolutely impossible unless accompanied by a postal parcels law. Giving a rate even four times as high as that of Germany, the entire rural delivery could be put on a paying basis to-morrow.

Here again would be an advantage to the country merchant. The farmer to-day, when he wishes to buy, hitches up a pair of horses, drives four or five miles, and makes a few purchases. If the United States had the postal parcels law of Austro-Hungary, the farmer would draw a postal check, mail it free, the merchant would deliver the goods to the post-office, and a few hours later they would be in the hands of the farmer.

The life of the farm, which has so many drawbacks, would thus be made vastly more comfortable. It is impossible to estimate in dollars how great the saving to the country would be in this one particular.

It would be easy to show the endless ramifications of this beneficial service; but space need not here be taken up for that purpose. Sufficient has been indicated to show that there is no man or woman, however poor, however rich, who would not be vastly benefited and convenienced by a government postal parcels system.

Craftsman. 14: 592-4. September, 1908.

More Efficient Postal Service. Gustav Stickley.

Speaking of the success of the rural routes, of which there are more than thirty-eight thousand already established in this country, Mr. Meyer says: “The isolation which existed in many parts of the country has been overcome; the people are in daily communication with their friends in the rest of the world; the daily papers and magazines come to the door of every farm house on the rural routes, and enlightenment and information are being spread broadcast through the land. Medical men have said that already the establishment of the rural service is having its effect upon the mentality of our country patrons, and that because of it insanity is on the decrease. The extension of the rural routes to include a parcel post,” he asserts, “will be a boon both to the rural population and to the store-keeper as the latter can receive his orders by mail or telephone and despatch the desired merchandise by the rural carrier. The farmer will be saved from hitching up his horse and losing the time he needs for planting or harvesting his crops, and it will enable the store-keeper to increase his sales and meet the requirements of modern trade.”

Much of the opposition to this measure has come from the country store-keeper, who very naturally dreads that such largely increased facilities for delivery by mail would simply extend the already wide domain of the department store and drive him completely out of business. But this objection has been met by the plan for a special postal service for the rural routes, which would be given at a much lower rate than that prevailing throughout the general system of parcel post. This special rate as advocated by Mr. Meyer would be five cents for the first pound and two cents for each successive pound up to the limit of eleven pounds, thus enabling any one along the line of rural route to use the mails for delivery of packages at a charge of twenty-five cents for the maximum weight, as opposed to one dollar and thirty-two cents for the same weight if sent at the regular rate of twelve cents a pound,—which regular rate would necessarily have to be used by department stores unless they should go to the trouble and expense of maintaining a large system of rural agencies throughout the country.

The result of such a system in bringing about the general dissemination of business throughout the country by fostering small individual enterprises is almost beyond calculation, especially as a secondary result would be the growth of small villages and settlements throughout the thinly settled farming districts. And these two changes in the present state of affairs would go far toward solving the whole problem of the possibility of turning the tide from the city back into the country. The hardships and discomforts of many of the conditions of city life, particularly among people of limited means, and the uncertainty of the wage-earner’s means of livelihood, are now endured chiefly because of the greater disadvantages that are attached to farming in remote parts of the country or to undertaking the responsibility of working independently of any large commercial or industrial organization. For months, the Craftsman has been urging the establishment of rural settlements and the introduction of handicrafts in connection with small farms. Nothing that is likely to be done in the way of legislation to this end seems to us to make so possible a general change for the better along these lines as the postal measures recommended by the Postmaster-General, supported by the President and now recognized by Republicans and Democrats alike as a reform that will not be downed, no matter how powerful are the interests opposing it. Given the postal savings bank as an encouragement to thrift, and transportation facilities that will not only bring all necessary merchandise within reach of the farmer, but also take the products of his own industry and a great part of the output of the village workshops to the nearest market at a reasonable rate, and the rest will follow almost as a matter of course. When a man has a fund of several hundred dollars, there is hardly any question as to what he will do with it if he has a chance. The desire to own a home and a little patch of land is universal with civilized mankind and when to the possibility of gratifying this desire is added facilities that render life in the country as interesting and as much abreast of the times as life in the city, the tenement question in cities will soon cease to be the serious problem it is now.

Independent. 70: 105-7. January 12, 1911.

Parcels Post Once More.

Proportional rural population is not diminishing. We do not know what the present census will say, but we do know that from 1890 to 1900 the country gained enormously on the city in its proportion of new settlers. The old record of 65 per cent. for the city tumbled down to a little over 30 per cent., and we know of no reversal of this tendency. Back to the country has become a universal cry. Lands are rising in value steadily, and deserted farms are a myth. At least, Governor Hughes in one of his speeches said that he should like to know where they were in New York State, for he could not find them. Country churches have often died, to be sure; but they were killed seventy-five years ago, and they do not note at all any decadence of farm prosperity. They went out when railroads began to be built. Crossroads stores have not been run to any extent for half a century, any more than crossroads taverns. They do not belong to advanced stages of country life, and are not needed.

Never was country life more progressive, better organized or more lifeful and hopeful. The crossroads has been displaced by the village store, and this village store must deliver its goods. It wants the parcels post. The trolley is reaching its fingers up into the valleys and touching the farmyards with its carrying capacity. The automobile is doing even more to reach the isolated farmhouse. We might as well forbid these forces and conveniences as to deny the farmer a parcels post. The same argument lies with intense force against rural free mail delivery in every form. It destroys many post offices; it keeps the farmer at home; it dissolves hamlet life: but it aids in the great movement of distributing the blessings of a complete life all over the country.

We are quite willing to face the frightful proposition which is offered us, of a community with no business institutions except the post office and the freight depot. We have seen the tens of thousands of district schoolhouses blotted out without a qualm, for we have seen the union schools gloriously taking up the work in their place. We have seen the little stores and taverns that used to be convenient for watering horses vanish, because we find a substitute in department stores, almost invariably within reach, by aid of the trolley and automobile. We are not worried at all when we contemplate a picture involving a more substantial country home, with its isolation abolished, hidden among the hills, but visited daily by the rural free delivery carrier, even tho he shall have in his automobile a ten-pound package for the housewife.

Without parley, we believe that the American people, almost without dissent, demand a parcels post service; and that if put to popular vote, this demand would be exprest by a majority of 90 to 1 the country over. The people are growing impatient over delay, and they are expressing this impatience very loudly. We believe that the coming Congress will hardly find it possible to ignore this desire. We quite agree with one of our contemporaries who says that the next step of social and economic progress in the United States is unquestionably bringing the producer and consumer closer together by reducing the cost of carrying small parcels.

People Demand a General Parcels Post. pp. 7-12.

William Sulzer.

Absence of a parcels-post law enables the railroad companies, through subsidiary companies called express companies, to eliminate all competition and prevent all regulation in one branch of transportation and to escape compliance with the laws that are being enforced against them in other branches of transportation by the several state commerce commissions and the Interstate Commerce Commission.

That the owners of the securities of these express companies have made enormous profits is a recognized fact. One hundred per cent, even 200 per cent, profit when an express company “cuts a melon” no longer excites surprise when found in the news columns of our evening paper.

No one objects to a fair profit for good service, but conditions seem to indicate that the transportation companies are not satisfied with the first and are not giving us the second, while developments before commerce commission hearings indicate that their backwardness in adopting economical and scientific business methods causes a tremendous unnecessary expense. This they are meeting by maintaining and even increasing already exorbitant rates for service that many believe are discriminatory, and that grave injury and injustice to business and to the general public results.

As an example, W. P. Dickinson, of the Burlington Railway, is quoted in the Railway Record as saying at a public hearing that the expenditures of the Burlington traffic department for printing and stationery in the fiscal year 1910 was $222,000. Assuming that they are typical for all the railways in the United States, the cost of printing railroad tariffs alone under present methods, is $6,000,000 to $10,000,000. In modern transportation methods, as, for instance, those in vogue in Germany, this expense is so trifling as to be scarcely worth considering. Freights move in Germany on a uniform tariff, based entirely upon bulk, weight, and distance, discrimination is impossible, and any shipper can learn in a moment, by referring to the table, the exact freight charge to any point, and can ship knowing that his competitors must pay the same price for the same service.

In the United States the shipper can not know all the tariffs that are published or how they affect rates. He is supplied with a few easily understood tables, but it is not within human possibility for him to even read, to say nothing of comprehending, the millions that are filed with the commission every year and how they affect the cost of the transportation he buys.

So it seems this extraordinary printing expense of millions, whatever its purpose may be, operates to keep the average shipper ignorant about rates. Ignorance is always dangerous, and particularly so in transportation matters.

Harrington Emerson, the expert, testified at the hearing before the Interstate Commerce Commission at Washington last November, that $300,000,000 annually in railroad operating expenses in this country would be saved if the railroads adopted better business methods of management.

To save for the consumers that enormous sum, no better beginning can be made than for the government to establish a satisfactory parcels post and adopt scientific business methods in its management.

That the interests that control our railroads also own and control the express companies and that their separate incorporation is merely a device to cover extortion and discrimination by complex contract relations is indicated by Senate Document No. 278, pages 53, 54, and 55:

Stock held by railways in express companies$20,668,000

Railway securities held by express companies34,542,950

Holdings of express companies in the stock of express companies11,618,125

Total intercorporate ownership express companies June 20, 190666,829,075

Express Company Rates Cause Loss to Shippers—Express Company Methods Cause Loss to the Postal Department

The peculiar, graduated, increasing rate for small-weight parcels is absolutely prohibitive for express transportation except at an actual loss for a considerable proportion of business. Most express shipments are in small parcels. They therefore pay the higher scale. This increased rate is exacted for both terminal and haulage service and is as high as 37½ times the first-class freight charge.

The express companies take from the Post Office Department the profitable business and pocket millions of profits, but leave the unprofitable for the Post Office Department. The profits from a parcels post would stop the post-office deficit and give us a 1-cent letter rate. The annual surplus of the British post-office department about equals our annual postal deficit. The British have a serviceable parcels post.

The men in the mail service have a record of one error in 18,000 pieces handled. Compare that with your experience with the express companies.

The Parcels Post Not Openly Opposed by the Beneficiaries of Present Methods

The opposition to the parcels post at the late congressional hearing was made by persons who appeared in the name of American Hardware Manufacturers’ Association, Illinois Retail Merchants’ Association, National Association of Retail Druggists, National Association Retail Grocers, National Retail Hardware Association, National Federation of Retail Implement & Vehicle Dealers’ Associations, Wholesale Dry Goods Association, Paint Manufacturers’ Association of the United States.

There was no direct opposition by the express companies to the parcels post.

Misdirected Energy Benefits Express Companies and Catalogue Houses

Since the members of the above commercial associations can not to any important degree be beneficiaries of the present confiscatory and restrictive system that has a monopoly of the transportation of merchandise in packages of 4 pounds to 20 pounds, some other reason for their opposition to the parcels post must be found, and in that connection the testimony given by these gentlemen at the hearing is interesting.

The main objection to the parcels post was that it would build up catalogue houses to the injury of retail businesses.

In reply to questions by members of the congressional committee, however, some of their specific objections applied only to the rural free delivery now firmly established and which nobody dreams of abolishing.

The other objections advanced were also to conditions already in existence, some of which at least it would seem would be less objectionable if we had a serviceable parcels post.

For instance, the mailing of catalogues by the catalogue houses. That can be done now to the farmer’s door for one-half cent an ounce, but even that low rate does not always get the business. I have seen the catalogue of Sears, Roebuck & Co. and the Chicago House Wrecking Co. that were sent by each of these firms to addressees who did not specify how he wished them sent. They were received since the date of the hearing; both catalogues came by prepaid express.

Had we a parcels post competing with the express companies and reducing their extortionate charges the express companies would be less able to deprive the government of that revenue by underbidding the Post Office Department rate on catalogues.

Catalogue Houses Don’t Need the Parcels Post, and Oppose It

At the congressional hearing so much was said by the opponents of the parcels post about the catalogue houses, how they were behind the parcels post—that it was for their sole benefit, etc., etc.—that I went to Chicago and succeeded in getting an interview with Mr. Julius Rosenwald, president of Sears, Roebuck & Co. He declined to support the parcels post. He said they were very well satisfied with conditions as they are, under which they had built up their immense business, which was done entirely by catalogue and without salesmen or commission. He explained that only an insignificant amount of their sales went by mail, that what did was unprofitable, as it cost as much to make ready and handle such little sales as larger shipments, jewelry being the only exception, and even for that they advised express.

Evidence that catalogue houses do not want or need, and do oppose, the parcels post was not lacking at the hearing.

For example: Marcus M. Marks, of the Merchants’ Association of New York, after stating that the Merchants’ Association is not in favor of a general parcels post and has frequently placed itself in opposition thereto he quoted one of the large Chicago catalogue houses as in opposition, and for this reason: “The result would be that instead of shipping goods in large bulk it would tend to create a demand for small shipments, which would increase his expense of doing business.” Marshall Field & Co., one of the largest concerns in this country, were referred to by both J. G. Baker, president National Federation of Retail Implements, etc., and H. L. McNamary, of the Hardware Dealers’ Association, as opposed to the parcels post.

All the opponents of the parcels post at the hearing, mostly retailers in heavy-weight goods, were very insistent to impress upon the minds of the committee the great injury that is being done their business by the big catalogue houses, who, they claimed, are underselling them and are doing a very large and increasing percentage of the business that belongs to and should go to the retail dealer. But is it correct to charge to the parcels post this great loss of trade which has occurred while we have no parcels post and that has been brought about by conditions that can claim no assistance from a parcels post? Is it reasonable to say that a parcels post would produce such conditions when no such conditions do exist as above noted where the parcels post has been in operation for many years?

Hampton’s. 26: 261-4. February, 1911.

Let Us Have a Parcels Post.

There would be some shadow of excuse for refusing to accept so great a convenience as the parcels post if, in accepting it, we would destroy a large investment in the business of the express companies. But, in fact, we would not destroy any legitimate values in these companies. They own practically nothing on which they would lose a dollar. Most of their money is not in the business of transporting freight, but in banking and investment enterprises. These would not be interfered with. Their tangible property actually used in transportation would be required, and would undoubtedly be taken over at good figures by the government, when it established a parcels post business. Their investments in stocks, bonds and banking business would be undisturbed. The express companies would lose nothing except their graft—the privilege of charging outrageous rates for the service they render. In morals and equity that ought to be ended as soon as possible.

The truth is that it is not the political and financial influences of the express companies which keeps Congress from giving this nation a parcels post. It is the pathetic and benighted ignorance of a considerable section of our own people, who have been led to believe that the parcels post would injure them. It is well-nigh impossible to believe that there can still be millions of intelligent Americans who doubt that national prosperity must be promoted by every increase of the facilities and cheapening of the cost of transportation. Yet there is such a section of the American public. Misguided and ignorant, it has permitted itself to become the chief bulwark of protection to the express companies’ graft. It persists in believing, in the face of nearly a century of world experience to the contrary, that there is danger in too easy, too cheap and too universal transportation!

Unwise Opposition of the Small Merchant

Reference, of course, is had to the fears which the merchants of the country towns entertain as to the effect of the parcels post upon their business. The country merchant has come to accept on this point the sophistical, disingenuous and dishonest arguments of the express lobby, skillfully put out through agencies whose real purpose is concealed.

The argument that cheap transportation of parcels will injure the country towns is exactly as reasonable as the contention that London and New York, Hamburg and Liverpool, Seattle and Sidney, must be injured by the railways and steam-ships which, bringing all parts of the world into close and easy communication, would make it impossible for great and dominating centers of population, commerce and industry to exist. Everybody can see how absurd such an argument would be. The best possible transportation facilities constitute the first requisite to making a great city. Commercial centers are prosperous and important, in proportion as they have adequate, efficient and cheap transportation. This is as true of the country town with a single railroad line as it is of a continent’s metropolis with half a hundred great railroad systems pouring their tonnage into its terminals and with the ships of all the seven seas unloading their cargoes at its wharves.

It is an axiom that good, ample and cheap transportation actually makes commerce. The country town which has no railroad always wants one. The hamlet which has no post-office is forever riding the neck of its congressman until it gets one. Great cities vote millions to build artificial harbors, to provide wharfage, and to increase every possible facility for cheap and rapid transportation.

There are no communities which need improvement of transportation so much as the country towns which have been misled into opposing the parcels post. The country merchant has been made to believe that the parcels post would take his business away from him and give it to the mail-order house in the great city. It would do nothing of the kind. On the contrary, it would give the country merchant the one facility which he does not now have: it would place him on a parity with the merchant in a great city.

Quick, cheap transportation would enable him to buy better and cheaper. He could sell many articles from catalogues instead of having to carry them in stock. He could create a mail-order business of his own in his surrounding territory. The local merchant who conducts his business well has nothing to fear from the mail-order house. Farmers and citizens prefer dealing with the home man, and the parcels post will give him many advantages that will enable him to increase his trade to proportions which are now impossible.

Of course, this does not apply to the country merchant who buys his goods badly or at high prices, and who gives long credits and sells at long prices. Parcels post or not, his day is doomed. More alert men, with better business ideas, will soon occupy his place. The alert, hustling merchant will use the parcels post so effectively that the old sleepy head’s day will end just that much sooner.

The proof of the pudding is in the eating. Every enlightened country except the United States has a parcels post. No country would think of abandoning it, any more than it would think of disestablishing its letter postal service. In the experience of all the world the argument about injuring the country town is sweepingly and completely refuted. The small town would gain vastly more than the large town by this tremendous increase and improvement of its transportation facilities. The whole public would benefit, for precisely the same reason that it benefits by having fast steamships instead of sailing vessels, limited passenger trains instead of stage coaches, two-cent letter postage instead of five-cent.

Part Played by the Express Companies

The people who oppose the parcels post are the innocent and unwitting dupes of the express monopoly. This is the one point in the parcels post argument that cannot be too constantly emphasized. When the dupes are brought to understand their true interests, Congress will not dare stand for a single session as the protector of express graft.

Small wonder that the express companies are fighting with every resource against the parcels post. They constitute one of the greatest groups of financial power in the country. They are united firmly. Most of the companies are large stock-holders in the others. Thus the United States Express Company was shown by the report of the Public Service Commission of New York, issued in 1908, to be capitalized at $10,000,000. Of this, the Adams Express Company owned nearly $1,000,000, the American Express Company exactly $1,000,000, and the Southern Express Company, $70,000. How tremendously profitable the business of the United States Express Company has been is shown by the fact that whereas the company claimed an investment of only $2,042,000 in real estate and equipment, it had $7,464,000 in investments, $895,000 in cash holdings, and $2,000,000 in collateral and other loans! That is to say, while this company had very little more than $2,000,000 invested in its transportation business, it had more than $10,000,000, representing surplus and undivided profit, in general investments!

It has accumulated such vast profits because it has been for many years charging unconscionable and scandalous rates for its service.

The Adams Express Company is shown by the current number of Moody’s Manual to have $12,000,000 capital. After paying large regular dividends and numerous extra dividends for many years, the company in 1907 found itself with such a tremendous surplus that it actually paid a special dividend of 200 per cent in 4-per-cent bonds! Every holder of a one-hundred-share of stock was presented with two hundred dollars’ worth of 4-per-cent bonds! The present, of course, represented in part the excessive charges which the company had been permitted to collect from the public.

But the most startling statistics of express accumulations are the financial statements of Wells Fargo and Company. For many years this company’s capital stock was $8,000,000. Its most recent statement, as published in Moody’s Manual, listed these assets: Real property, $4,100,000; equipment used in transportation, $2,044,000; stocks owned as investments, $3,211,000; bonds owned as investment, $3,750,000; loans, $17,165,000; cash on hand and in the bank, $5,459,000.

Such were the accumulations of this company whose own statement admitted that the equipment actually used in its transportation business represented only $2,044,000. The company has always paid large dividends. Its star performance in this line was the payment, early in 1910, of a cash dividend of 300 per cent. Every holder of a one-hundred-dollar share of stock was given three hundred dollars cash!

This was not all. The stock of the company was worth in the market exceedingly high prices. In addition to giving this 300-per-cent cash dividend, the company increased its stock from $8,000,000 to $24,000,000, and gave the holders of the original $8,000,000 the right to subscribe at par for two shares of the new issue for each share of their previous holding.

Enormous Profits of the Express Companies

These figures suggest the profits express companies have been making. They have been making them because our government is the only government which permits such a monopoly. It is a monopoly which not only extorts millions upon millions every year from the people, but which enables railroad companies, through their intimate business and financial relations with the express companies, to conceal a very considerable part of their earnings. The express companies are large holders of one another’s stock, and also of railway stock; in turn, the men who control the great railway combinations are themselves big owners of express-company stocks and bonds. The express companies lease from the railroads the right to transport freight over the railroad lines. The terms of these leases represent, not a reasonable and fair charge for the service, but an elaborate project of covering up excessive earnings and extortionate charges in a maze of complicated intercorporation transactions.

The worst penalty that the American public pays in order that the express grafters may make these huge profits and conduct these manipulations, does not lie in the excessive charges. It lies rather in the stunting and depressing effect upon general business, which is a necessary and manifest result of a policy that denies the freest and cheapest transportation facilities to the entire community.

Good Housekeeping. 53: 2-10. July, 1911.

Housekeeping by Parcels Post.

Isabel G. Curtis.

What would a parcels post mean to the American housekeeper? The suburban or rural family could receive the bulk of its supplies by mail—clothing, food, even eggs and butter and fresh meat. And the country household that had something to sell could, by availing itself of the parcels post, eliminate the expensive middleman and ship direct to the consumer. Thus the city housekeeper could receive eggs, butter and other things by mail at much less than she pays now. In scores of ways the parcels post would tend greatly to decrease the cost of living, for it would revolutionize the present cumbrous and expensive methods of retail business.

The United States Postoffice authorities will accept a package of not more than twelve pounds in weight and not more than three and one-half feet wide by six feet long for delivery at any postoffice in England, Germany or in any one of the thirty-nine foreign countries blessed with the parcels-post system, at a rate of twelve cents a pound. But you are denied the privilege of sending the same package to any destination in your own country at any price. A four-pound package sent to a local point will cost the sender sixty-four cents while the same package can be sent to New Zealand or Costa Rica for forty-eight cents.

The parcels-post rates in foreign countries are very moderate. In Germany, for instance, weight and distance determine the amount of the charge. The distance charge is fixed by means of zones, the first zone having a radius of ten geographical miles from the sending point, the second twenty, etc. The charge for an eleven-pound parcel is six cents within the first zone and twelve cents for every greater distance. For parcels weighing more, the charge is the same for the first five kilograms, but varies proportionately for each additional kilogram. In Germany, the weight limit is one hundred pounds, in England eleven, in France twenty-two and in Belgium one hundred and thirty-two pounds. That there is no good economic reason why any civilized community cannot have a parcels post seems to be proved conclusively by the earnings of the postal departments of the governments that have tried it. The postoffice departments of Germany and France each has a yearly surplus of more than $14,000,000, and England enjoys a surplus of more than $20,000,000—a striking contrast to our own Postoffice Department, with its annual deficit of millions.