In the obviousness department, it stacked right up there with “Weather Cools as Winter Nears” and “Retail Sales to Increase After Thanksgiving.”
The American Postal Workers Union this week called on the Postmaster General Megan Brennan to “make postal banking a reality now.”
The union announced its support for the Campaign for Postal Banking, an Astroturf group that claims postal banking would “strengthen” the Postal Service by establishing a new source of revenue, “and also help the 28 percent of U.S. households who are underserved by traditional banks and turn instead to payday lenders, check cashers and other financial predators.”
It’s three for one. We can save America from those “financial predators.” We can use the more than 30,000 branches of the U.S. Postal Service to “provide affordable, non-profit, consumer-driven financial services ranging from paycheck cashing and bill payment to savings accounts and small-dollar loans.” And we can earn a few bucks for the chronically strapped Postal Service.
It’ll be terrific.
The people who dumbed down the definition of on-time delivery of mail, then failed the on-time test worse than ever, can be in charge of cashing checks, providing electronic fund transfers, offering fee-free ATM machines and accepting payments on utility bills.
Why? There is a $40 billion industry providing all these services. In many cases, the players in that industry are Native American tribes who also can be argued to need the money.
But it’s not about meeting the needs of small-dollar banking customers anyway.
Bernie Sanders, Elizabeth Warren and others from the far left say they want to “take on Wall Street” and “break up the big banks.” But it turns out the banks donate a lot of money to them, so they actually take quite good care of our financial community.
The Dodd-Frank law, the fruit of their fearmongering after the financial upheaval of 2009, actually enshrines the “too-big-to-fail” concept that supposedly brought us to the brink in 2008. It actually gave bigger banks even more advantages over smaller banks. With their balance sheets bolstered by that law – and even before – banks have changed their focus to their wealthier customers and made it difficult for the less wealthy to do business with them at all. When you make $400 a week, $30 for bank fees and $35 per hot check fee is not something you can afford.
So these people drop out of traditional banking – or never sign up. When they need small-dollar loans for car repairs or to make the rent, they turn to payday or car title lenders. These lenders take a few extra risks – they demand less in financial wherewithal and collateral and provide the loans quickly – but charge higher interest rates.
Never mind that 77 percent of these loans are paid in full on time, and only 10 percent or so are charged off, these lending institutions threaten the low end of the market for traditional banks. So they are labeled by the likes of Warren and Sanders as predators on the poor and unworthy of their legal status.
Government chips in by resorting to means such as the Consumer Financial Protection Bureau and Operation Choke Point to harass these businesses into bankruptcy. They cut off their paths to financing by threatening their lenders. They harass their customers, disrupt their supply chains and do everything they can to force these businesses to the sidelines.
Now, the left’s buddies in Big Banking still don’t even want to try to serve small-dollar customers, and they can’t very well let the upstarts in the payday lending industry make a buck and establish themselves. So they want to make government the competitor and put the Postal Service back in the banking business.
Imagine that: The people who unleashed Operation Choke Point want control over whether you can get a loan, pay your bills or cash your paycheck. And the government-sponsored enterprise that has lost more than $50 billion in the last six years, tapped out its $15 billion line of credit and failed to post a profitable quarter since 2007 wants to manage an operation that lends money to America’s most vulnerable loan customers. What possibly could go wrong?
And the American Postal Workers Union, a positively parasitic union whose interests extend not a scintilla beyond that of getting more jobs and working hours for its members, wants to make this a reality. As soon as possible.
Yes, as is often pointed out in these stories, the Postal Service used to offer a variety of banking services. But that was back before the private sector offered them and before the Postal Service was losing $5 billion or more per year and falling ever further behind its delivery goals.
Why not knock off the ever-elusive search for ever-more exotic ways to make money and go back and perfect the business the Postal Service is expected to do – the one on which it has monopoly protection: delivering first-class mail reliably and on time? Get that straight first, then come back and tell us what private industries you want to compete against for no reason.