Video: USPS losing tens of millions annually subsidizing shipments to Alaska

Alaska, postal 16 Comments

HOOPER BAY, Alaska — In the soggy, unforgiving tundra on the shores of the Bering Sea, Royala Bell defrosts a rack of beef ribs for dinner in a kitchen that doubles as a bedroom for six of her seven children.

A dead owl lies on the floor, ready for her husband, Carlton, to defeather it for a headdress. Fish dry on a line out back, for the larder in winter. On a small counter are some of the groceries the Bells consume from the Lower 48: Sailor Boy Pilot Bread, potatoes, Kool-Aid, Aunt Jemima pancake mix and a can of Coca-Cola.

The U.S. Postal Service paid to ship the items on a turboprop bush plane to this small settlement of Yupik Indians on Alaska’s western edge. The Bells brought them home on the back of their all-terrain vehicle from Hooper Bay’s only grocery store. The 12-pack of Coke alone cost the Postal Service $21 to get here.

Read more: U.S. Postal Service losing tens of millions annually subsidizing shipments to Alaska – The Washington Post.

  • Liam Skye

    The Alaska Bypass Program is a little-known government program directly subsidized by USPS to the tune of over $70 million per year. I have read thousands of uninformed and buffoonish louts comment about their mistaken belief that the government subsidizes USPS but never a one who knows that USPS actually subsidizes the government.

  • JG4th

    as well as the airline and trucking industry///

  • tru_grits

    This is a good example of why the USPS exists as a government agency and not a for-profit corporation.
    Alaska is a state. USPS is required to deliver mail to all citizens of the USA, whether they live in the state of N.Y. or the state of Alaska, or somewhere in one of the islands in the state of Hawaii.
    Is that profitable? Of course not, but that’s the whole point. EVERYBODY gets their mail because it’s the US Postal SERVICE (emphasis on the service to the citizens of the United States)

  • retired too

    Whether it be Alaska or rural Nebraska yes the postal service loses money delivering to these remote areas, for the good of the country. Any private concern would either decline or charge huge surcharges for such service. Yet rural areas feed and provide energy and other vital products for urban residents to enjoy. For the good of the entire country we have universal service provided by the USPS.

  • Surprise!

    When extra services are provided it costs money and that money has to come from someplace.

    Words such as non-profit and government agency don’t make those dollars appear.

    USPS gets their dollars pretty much the same way UPS and FedEx does.

  • postalworker1

    USPS IS the best non-profit agency in the world, ALL we need is a LIL help from the POLITICIANS and we shall survive,,

  • Liam Skye

    You don;t understand the Alaska Bypass Program. It is simply a direct subsidy to certain favored Alaska bush cargo airlines. The material is not mail at all – it is bulk shipments of cargo, some of it luxuries like enormous shipments of cola-flavored caffeine and sugar water. It is not accepted as mail, it is not transported as mail, and USPS doesn’t even deliver it. USPS’ role is simply to subsidize this program designed by Congress. USPS doesn;t even get to negotiate rates with the cargo airlines it funnels millions of dollars to – the rates are fixed by the Department of Transportation, USPS should not have to provide funding for Congressional programs for which its only involvement is paying the bill.

  • Liam Skye

    It has nothing whatsoever to do with delivering mail. USPS is simply being required by Congress to subsidize the cargo airlines. This material is not mail and USPS doesn’t even deliver it – it just pays for it to be flown in bulk from and to certain destinations by certain cargo airlines.

  • common sense

    I think some of you guys need to read the full article on the Post web site- this has nothing to do with mail! No one questions providing mail service to people in Alaska, even if it costs more than delivering in the rest of the country. The Alaska Bypass Mail Program has nothing to do with that. It subsidizes private air companies that ship supplies to remote settlements. It is a service that is ONLY provided in Alaska:

    “Retailers pay the Postal Service about half of what it would cost them to ship the goods commercially; the subsidy allows them to charge a hefty markup on a can of Coke, for example, in some cases 30 percent or more. The agency, by law, must pay private air carriers well above market rates in the only corner of the country where airline prices are still regulated.”

    So mailers in the rest of the US are forced to subsidize Alaska residents’ groceries. That has nothing to do with universal service. If Alaskans want to subsidize air freight to the bush, then the state of Alaska should pay for it, not the rest of us.

  • retired too

    Yes I do understand the article and it speaks well for itself. The USPS is subsidizing flights who’s main role is to carry cargo not mail in Alaska. Clearly this should be adjusted. My main point was to remind readers that no matter what the cause the USPS loses money delivering to sparsely populated areas.

  • Liam Skye

    You do not understand the program if you really believe, as you state, that USPS delivers that cargo. It does not deliver it at all. Perhaps you are just using the term in a different manner than I do (which involves the delivery to the final destination). All USPS does is collect the minimal fee and then pay the substantial fee to the cargo airline for handling, airlifting, and delivering the cargo to its owner.

  • retired too

    You are correct, I use the term in a different manner

  • Liam Skye

    Finally – somebody who understands that Alaska Bypass has absolutely nothing to do with mail delivery! I was beginning to think I was the only person left in the nation that actually understands this program. People just can;t seem to accept the fact that USPS is subsidizing a government program entirely unrelated to mail delivery.

  • Liam Skye

    I understand what you are saying now. Thanks!

  • Consuelo

    Cargo is considered mail in Alaska as a lot of the bush gets their food that way! Without this service Bush Alaska would be without food or other necessities and this has been going on for many many years why is this an issue now, should we leave Alaska Natives without necessities, have you ever visited Alaska? it generates oil and by the way it also serves the Military Bases there.

  • common sense

    You have things backwards. “Cargo is considered mail in Alaska” because politicians force the USPS to subsidize cheap air freight there. If this “service” was stopped, private air freight providers (who are the ones doing the actual flying now anyway) would continue to provide the service, at market rates. It would probably be more expensive for consumers, and less profitable for air freight providers. So what? If it’s more expensive, deal with it- the way people in isolated areas in the rest of the country have to!

    But thank you for bringing up oil- Alaska does indeed produce oil- and it makes a lot of money doing so- Alaskans get bonus welfare checks every year ($900 per person last year!) from the oil fields- if Alaska wants to subsidize air freight for Alaskans, Alaska has more than enough money to pay for it! (And so does the Defense Department!)