As a gag gift, I've bought a phone case from Aliexpress for a friend. The total, including shipping, was $0.46. The case itself did fit the phone and was technically usable.
I've bought a bunch of small trinkets from Aliexpress. For the most part, they're the same exact things you can buy off of Amazon for ~$5-15, except they take 2ish months to be delivered. For some things, it actually does make sense to just wait that long (e.g. a Google Home Mini wall mount) in exchange for the savings (>= 50% is normal).
Unless one of the cases is manufactured under considerably different environmental standards and locally that isn’t the case.
The higher price on Amazon is due to two factors - local reseller markup and expedited shipping.
Heck many AlizonExpress sellers will have multiple listings for the same product at different prices based on how fast they’ll ship.
So we can safely assume that both items ship from China.
So we can more or less safely assume that both are shipped from China.
Now when you wait 4-6 weeks for a delivery from China you are essentially waiting for them to fill a container, when you pay more for a shipping you pay for the extra shipping space wasted by expediting your shipping.
This is because of how international shipping economics work, international shipping is economical when it’s full to the brim since shipping companies have a flat tonnage tax.
This means that shipping companies are taxed based on the total tonnage capacity of their vessels not the actual amount or value of the goods they transfer.
Unless you source something locally in a manner that it’s actually environmentally more sounds that statement is false.
And don’t forget that even buying locally doesn’t guarantee any better environmental outcome, for example buying a 3D printed case form someone on Etsy is likely just if not more polluting than buying an injection molded case from China since the filament, resin and heck even the 3D printer itself came form China.
I used to run a small business when I was in college in Canada 2010-2012, selling sunglasses on Ebay, and later Amazon.
It was super low effort. Buy wholesale on Alibaba, tell the seller to send goods to packing, and silkscreen shop, and send by regular post to my apartment. Very often, fancy packaging was costing more than sunglasses themselves.
Even when I was buying crate loads of goods, I only got a customs bill only like 2 times out of 10 in 3 years. Customs bill was pretty much nothing, and they never contested the valuation, but the extra paperwork was very unpleasant at the time when I had to study.
Then you sell $1-$2-$3 sunglasses at $100+ prices. Just make decent websites for all made up brands you have, have good marketing fluff, and make sure to call them with some Italian/French sounding name.
You make at around 10-15 sells per month, but what else you want with that level of effort? Second to that, I was very unsure of my tax/legal status at large if that business were to become too big. Being kicked out of the country, with all my money in that degree wouldn't be fun.
When I was at high school I used to import all kinds of memory card adapters from dealextreme and sell them on immediately for 10x the price on ebay. My dad ended up helping me pay taxes on the money I made because it was actually getting really significant
>>Even when I was buying crate loads of goods, I only got a customs bill only like 2 times out of 10 in 3 years.
Tbf, you should have been paying for every crate, even if the customs agency didn't intercept it. It's up to you to make sure the duties are paid - if you ever got caught you would have been wholly responsible for not paying the duties even if you weren't asked to. But yeah, I know how it works in practice.
I'm sure, I was at least not picking polycarbonate glasses for reason they look, and feel too toyish, and too many of them would be scratched in transit/pop out of frames unless overmolded.
For the same reason, I did not risk buying plastic frames. They break/bend too easily.
I'm still amazed that Chinese factories managed to make optical grade glass, cut, and polished for glasses almost as cheap as molded polycarbonate.
No more and no less deceptive than any other brand. He has not said he is using someone else's brand just making one up. Fun fact, all brands are essentially made up.
Huh, interesting, that's not the answer I expected, let's unpack that. Could you give me a typical user story from your point of view? I've tried to come up with one (A, below) but I just can't make it convincing. I have also included what I suspect a typical user story looks like and labeled it B. Of course, B is rife with deception.
A: Alice clicks on an ad for Lens Luxury glasses, likes the picture of the product, and orders them on account of the $100 price-tag being roughly consistent with what she expects to pay for said level of quality, despite the fact that she sees the same sunglasses at a $10 price point every time she goes through a checkout aisle. She receives the glasses and is happy with them. Dave the Dropshipper earns $97 for providing the service of connecting customer and product.
B: Bob notices his sunglasses are losing their coating. He knows he could go to Walmart or Amazon or the nearest convenience store and pick up a pair produced in China under conditions of extreme cost optimization and dubious labor / environmental / trade conditions, but on account of recently hearing some horror stories he holds out. A few days later, he starts seeing Lens Luxury Facebook ads and Instagram / Blog content marketing. Unaware of the prevalence of "content marketing," he develops the impression that Lens Luxury is an emerging trendy brand and visits their website, which has an Italian name, pictures of a factory in Italy, smiling Italian models, and copy that strongly suggests the glasses are made in Italy without literally saying it. The site has sections about environmental impact and labor fairness (100% worker owned!) and a pricetag to match -- at least, as far as Bob understands sunglasses pricing, which isn't far. He decides to support this nonexistent picturesque Italian company, and orders the sunglasses. Six months later, the hinges rust out, and he is alarmed to find that Lens Luxury has vanished from the internet, leaving behind a trail of angry blogposts from customers who have experienced the same problem. He learns that it wasn't an Italian company after all and makes an angry post on facebook warning his friends to not do business with Lens Luxury, blissfully unaware that they are now doing business under the name Style Sunglasses.
I asked for your help in making scenario A plausible. You ignored me and complained that my fictional scenarios were fictional.
I take this as an admission that you cannot imagine a scenario in which the marketing practices you claim are non-deceptive are in fact non-deceptive. That says it all, really.
OP invented every part. The made-up nitpicking, a la dreamland, is in your response. OP did a good job illustrating his position. Both scenarios sounded bad to me, as neither operates on profit by margins, but instead on the hiding of information from the consumer.
One thing I learned from that operation was how hard it is to honour returns. A return cost many, many times the cost of such cheap product.
I had cases of returns, and angry reviews because people didn't like even single, barely visible scratch on the glass, which I myself somehow overlooked.
Not honouring returns was a 100% sure way to get kicked off ebay, and amazon 10 years ago, and maybe even more today. This is what I learned on forums of people doing small business on ebay that I read prior to starting.
Knowing that, I picked products from samples that survived most abuse, and had hardest, and best looking surface finish.
Even with all of that, you can't do anything about returns made for no other reason than "I simply don't like it"
I'm currently listening to Bernie Sanders Filibuster (Millennial/LoFi edition) https://www.youtube.com/watch?v=pm6qy_9E0rY , it sounds so close to what you wrote (but extended) that I read it with Sanders' voice.
I believe you when you say that you 'honestly dont see what the con is' and agree with other comments 'this is totally normal.
So perhaps it helps bridge our divide if I ask you to imagine me as someone who is a little more sensitive to deception, games, exploitation, manipulation.
I understand right now you might again say 'but non of this is me and you have still made no point'. We are probably wired differently, or have differing world views about why live, what purpose money might serve, something along those lines.
I am impressed with your creativity and business 'tenacity'. But from where I/my mind/folks i associate with (im the kind of 30s person who says 'folks') these steps to 'create' 'value' are at best an engineering of perceptions.
We could talk about how everything engineers our perceptions, all the way to the style of clothing, culture, language, how tall are you. But my reaction was meant to focus, empathetically, on a conscious and intelligent effort to convince presumably uninformed or ill equipped people to trust your presentation, its integrity etc and spend money.
Its about a hard to describe heart felt opposition not to the pursuit of profits but opposition to a maneuvering to assign artificial value to things. I think these practices tarnish the good image of a persons business intellect, and their position on more human interests, and capitalism, and even further a culture.
It almost feels like a good v evil thing. Will we
G: identify known value or suspected opportunities for value and produce/consume accordingly, whether it is for entertainment, health whatever
E: provide a platform for maximum profit, engineering consumers and humanity into some sort of monster hamster wheel of feeding our masters. I get this is a huge reach from our original point but thought perhaps the very extended image would entertain and lighten my attempt to clarify. Ultimately whichever way it goes i guess the sun will eventually die.
So I've heard this claim before, and it's I can't believe that it's true. I can easily tell the difference between Wyborowa or Finlandia, the difference in taste is massive.
It's the low-end vodkas that are literally identical. Many high-end -- or just "quality" -- spirits are in fact different. Tito's, for example, is distilled 6 times.
My perspective is that this business practice fills a niche of demand and is absolutely ethical. Your suspicion that this capitalism is what is causing people to want to burn everything down needs some proof to be anything more than a political statement.
Calling someone a jerk for being smarter and less lazier than you doesn't do anything for your argument, either.
I'm sure that everyone who bought a pair of those flashy cool looking sunglasses were very happy with them and enjoyed telling their friends that they were an expensive Italian/French designer pair.
And as to your final attempt to soften your attack, I got one thing to say: There's always someone happy to spend their money.
Nah, it sounds like OP was basically a ripoff artist- not smarter or more industrious, just more amoral. Pretty scummy way to make a living, hopefully it’s not viable from now on.
I'm not sure if I agree or disagree that there's something bad going on here.
It sounds like:
1. Supplier purchases whitelabel goods from China.
2. Supplier produces fancy branding and marketing.
3. Supplier sells product for a markup.
As long as they're not claiming the goods were made somewhere they're not, or that they do something that they don't, what's the difference between "Sunglasses by baybal2 (Made in China)" and "Some other product with a luxury brand name (Made in China)"?
Or to put another example, is Superdry.com scummy because their marketing implies that they're Japanese when they're actually British?
EDIT: from a consumer perspective, there being tonnes of whitelabel brand names that are meaningless is definitely a pain, but how do you resolve that? Heavy regulation forming a higher barrier to entry?
Worse than lots of meaningless brand names is when a reputable brand gets acquired, and then the quality of the goods massively reduced in pursuit of maximising profits.
I mean, I don't think we need to have an immediate regulatory answer to recognize it's a kind of scummy practice. Just because the consumer is too stupid to recognize the scumminess of the practice doesn't make it not scummy.
Oh please. There's nothing legally wrong with it but you'd have to be pretty dense not to see the moral issue with labeling something in a way that would signal it as "high end" to consumers while it's actually just being marked up 100x over cost or more.
Is there anything legally wrong with it? No, caveat emptor but I think you have to be willfully ignoring the moral implication to not see the issue with essentially abusing someone's preconceptions.
"High-end-ness" can and does carry connotations of exclusivity, design, price signaling, and so forth, not just product quality. It doesn't stink of scumminess to me at all. There is no requirement, be it moral, legal, or whatever, that there be a tight correlation between manufacture cost and retail price.
Why did you launch into a "oh please" rant instead of directly answering GP's reasonable question? What precisely do you take issue with? You seem to have some mental model here, so let's talk about it.
Sure, I'll bite. Even though I take issue with all of these as they're more-or-less a form of lying, these two stand out:
> selling goods with a high markup is scummy
> selling cheap goods with a high markup is scummy
The latter one especially takes the cake. When you resell a $2 item for $100, you imply that your contribution as a middle-man is worth $98. The other items on the list (which effectively amount to marketing tactics) essentially act as a way to convince (or, more accurately, take advantage of) consumers that your product is not actually worth $2.
Here's a great way to reformulate the morality of the matter in your mind: if you knew that all you were buying were $2 plastic sunglasses from China trussed up with European brand name to look high-end and high-quality, would you still be happy spending $100?
> (or, more accurately, take advantage of) consumers that your product is not actually worth $2.
Do you actually earnestly believe that most consumers think it costs a significant fraction of $100 to make a pair (any pair) of non-prescription sunglasses (manufactured anywhere in the world)? If so, that strikes me as incredibly naive.
What differentiates a pair of Ray-Ban Wayfarers (which I happen to like) from the $3 white label imports on AliExpress? Almost nothing, so far as I can tell, aside from branding and the design of the sunglasses.
And the design is entirely subjective--who are you to tell me that a pair of Wayfarers is not worth $150? For that matter, who are you to say that $100 is too much for a pair of re-branded white label sunglasses from AliExpress. And that's a two-way street: Who am I to tell you that $0 is too much for a pair of aviators?
> you imply that your contribution as a middle-man is worth $98.
Supposing I can connect a consumer with a product he likes and wants, why should it be impossible (or even improbable) for my contribution to be $98? Nothing is stopping him from shopping on Ali directly. Nothing is stopping Ali vendors from setting up a branded website in English. And, yet, there is the unmet desire that I would be fulfilling.
> Here's a great way to reformulate the morality of the matter in your mind: if you knew that all you were buying were $2 plastic sunglasses from China trussed up with European brand name to look high-end and high-quality, would you still be happy spending $100?
Let me answer your hypothetical with a real example: Generic prescription eyeglasses cost $15 on Zenni. I saw someone wearing a particular design I really like (different company, and the design probably costs 2x to make, but they are no longer available). I know they cost less than $30 to make, but I would be delighted to pay $300 for a pair of those glasses, even a pair of look-alikes.
Sorry, I don't check HN often and it took me a while to formulate a worthwhile response.
It depends what you consider significant; regardless, it's a really good question. I think I'll actually ask people I know when I get the chance to see how much they think Wayfarers cost to make / are intrinsically worth. I hypothesize that few will say something under $10, but I could be wrong!
I get what you're saying in that the consumers dictate what something is worth, but that's a fundamental premise I have can't subscribe to: all you have to do as the seller is convince the consumer that it's worth more and poof! more profit. Is that ethical, or should the seller just take it upon themselves to behave responsibility and not have a 5000% margin? So yes, obviously fulfilling an unmet desire should be rewarded, but by 50x the cost of the actual thing you're selling? I just struggle to reconcile the value gap between the actual labor+physical good and the... virtual marketing.
Your Zenni example again ties into the above: you may be happy to pay that (and I probably would be too, if I liked them enough! thankfully we can afford it), but selling them to you for a 10x markup would be a dick move.
This is probably my fundamental thesis, on which we may have to agree to disagree: just because someone is willing to pay X for Y, doesn't suddenly make it okay to charge X for Y.
If you mislead a customer in order to make them buy something, then that is fraud.
Superdry is an odd one. Perhaps they are crossing a line, or perhaps they're just selling a kind of semi-japanese-but-made-in-UK styling. It all depends whether the customers know the truth.
instead of asking each question, just ask 'is some activity deceiving a persons perceptions to 'artificially' extract value?
It is .. i hate to disclose this not totally productive statement .. but i am 'floored' to see how 5050 of a split there is on HN. This concept in my worldview/local culture is like year 5 childhood values/dishonesty stuff.
i hate to give a shoutout to history but .. im winking and smiling at you Google culture 2010.
This is what every brand does to some degree or other. Do you really think that Oakley sunglasses at $400 are in any meaningful way superior to say a pair of Levi's branded ones sold for $50?
I love this point coming up. I am not excluding other entities of this behavior. I am nervously saying 'great another person is doing it fml' #Idiocracymovie
Sounds to me like the implied scumminess is more of a subjective experience, which is not shared by a large portion of happy consumers and businessmen.
You might be sort of right but the statement is illformed.
Happiness is a subjective experience and some people here are aligned with one portion of values and another portion are aligned with other values. If it matters or exposes more mentality.. my views / what you are opposed to - - to me are classic, pure american (US) capitalism values.. when we behave not just to the letter of the law but within the intent of the law and with respect to the culture, and with a sense of responsibility and accountability. A refined yet aggressive and successful business class does exist and is not scummy. I don't need documents I'm a part of a 4th generation US manufacturing family.
Sadly our republican class values are currently high-jacked or i would point you to that 'label'
I don't think the individual reselling sunglasses is necessarily being "unethical". As you point out, there's nothing obviously wrong with the individual actions.
The reason it's troubling is that they are making money without actually adding any value. The sunglasses were created by factory workers in China. If you sell a pair for 100$ and they only get a few pennies, they are being ripped off.
Capitalism doesn't reward creation of actual value. It mostly rewards ownership of capital[1], and occasionally 'hacks' like the OP's. Honestly I am not too worried about them making a few thousand dollars from people with too much money. But it's the tip of the iceberg w.r.t. a dysfunctional economic system, which is why it tends to rub people, especially those who try to 'make an honest living' (by e.g. actually building something useful), the wrong way.
If factory workers are getting pennies while other people in the chain make orders of magnitude more per sale, that's a price signal saying you shouldn't take a factory job becasue other roles are more needed. If you mess with those motivators you'll just end up with a less efficient system as yet more people pile into such jobs when we need them to learn skills and contribute elsewhere.
You're thinking in terms of a steady-state. If a middle-man is able to do such a high markup then it means that yes we need more middle-men, because the increased competition will reduce their ability to have such markups. The need is proven by the high margin itself. If we add more factories and factory workers, on the other hand, end buyers won't gain squat since you're only addressing a tiny component of the cost.
And when factory workers try to unionize, and the company spends millions of dollars on anti-union propaganda, that's just price signals, too, I suppose?
No. That is the owners of capital wielding their power to keep the workers--the foundation that keeps the whole show running--underpaid, so that the owners can maximize their profits. Capitalism 101. Maybe actually read the book I linked to. 7 billion people in this world don't live in the free market fantasy land that you're describing.
The expanded view of my argument is meant to be more productive, not to soften. As I said in the expansion 'almost like good versus evil'.
It is certainly true that any individual or group of people may be happy to do some thing (spend money and do something). Whether it is rob a bank, get drunk and drive a car, or cure cancer people will always be happy to do some thing (referring to your point 'someone always happy to pay for a thing) as if this is the signal of some thing is OK). Just because the sensation of novelty happens doesn't mean we are doing well (see: basically any shitty thing humans do for a while and regret being assigned value through this mechanism).
I'm trying to look at this from a higher altitude and say that with the levels of intellect and passion I'm aware of (and apologies for the lack of hard evidence or citations) I believe we are capable of better things.
I believe in capitalism. I believe in the motivation to better ourselves to improve our circumstances through effort and education followed by returns due to providing things that people need or want. The sunglasses example in my view is a kind of prostitution of what the intention of capitalism is. In other words the hackers approach to capitalism. (I professionally and academically identify with and appreciate a hackers mentality, except in an economic social organizational sense due to it's regular self serving at any cost cultural grey areas). The mentality to circumvent standards and the creativity required to see pathways through a system is critically valuable to our species, but how in this case. In an attempt to open to you knowing/or having better view and resources on this than I do, please share a read, or whatever you expected me to provide?
It feels like a waste of time, a waste of materials, a waste of human thinking, a pure waste of a reason to do anything when something is done just to synthesize value.
For a light hearted 'citation': I see that the more pervasive this kind of behavior becomes in our world the closer to a scenario like the film Idiocracy we will become.
> It feels like a waste of time, a waste of materials, a waste of human thinking, a pure waste of a reason to do anything when something is done just to synthesize value.
Value attributed to an item is not absolute, and this is where your argument fails. Value is something that is agreed upon by two parties and can be any arbitrary amount.
I have been juggling with trying to understand you. Perhaps as much as you me.
I think i have something we can both understand 'trashiness of value' could be measured partly as measure of its proximity to unessential processes to artificially inflate value. This is a robbery not of cops and robbers and masks but of the ability for a person to be disguised as clever and take advantage of peoples sense of trust and hope for positive market behavior. I do believe it is destroying us.
Another attempt: my views are an attempt to present the value system/logic of why we might be happier, more successful when our transactions are more aligned with Real Value than Perceived Value. Youre welcome to help me improve this. We both want the same thing, it seems. We just are seeing different roads to the same successful/free choice result. Or maybe its more accurate to say that i see a risk/or a loss in a behavior within the widely accepted system of consumer\producer behaviors. An opportunity to optimize.
Value is arbitrary. But we are trying to describe specific types of value. And debate their merit.
And, my point is that as passive bystanders, we don't have any input into the agreement that those two parties arrive at for their arbitrary value. As long as they both are consenting, and satisfied with the exchange, it is ethical whatever value they decide.
In what world? If that were true why cant i go buy automatic machine guns, lsd, and drive counterfeit ferraris with rock climbing suspension down snow covered ski areas while shooting at the sky, assuming me and the sellers agree to the deal.... because we are trying to not live in todays version of a game of thrones world.
- where did your argument suceed?
- where i say 'this deceptive' transaction is not good for society. I agree this is subjective.
- I present a wildly inflated case, based on your criteria 'seller buyer agree' to present that this formula would not lead to a good world, destruction/chaos, self endangerment.
- I believe our disconnect is not where we fail to align argument paths but backing up, where we fail to agree on a definition of what is 'good'. Would you like to take the lead?
The price point is around the same as Ray Bans, some of which are also made in China at a cost of $1-3 (if that). The parent poster's business practice is not unique. It all comes down to marketing and capitalism, which, I agree, could be described as slimy, but then the question becomes why single out the parent poster for being slimy?
Those are good points. I’d counter them by saying that the pair I own, I bought direct from the manufacturer, and they bear the text I quoted. It’s true that every pair I’ve seen bear this text. My point is the brand has value due to the working conditions under which the product was made, and the quality of materials used. I would consider the glasses hand made in Italy to be the superior products to some purchasers’ minds, as they are closer to the original origin of the product. This is not to say products from China cannot be quality products, but the heritage of the company in question does count for something.
Do you have a source for that or can you elaborate?
Since the delivery time is so long, I’d expect the parcel gets shipped with multiple others.
The only items that get shipped are the ones that have been actually bought, which sounds efficient.
Of course there are negative aspects too and I wouldn’t know if the overall outcome is positive or negative, when compared to buying a product from Amazon.
Again, a link or more details would be very helpful.
I mean that's pretty much the whole trick to it. It gets to the boat with the rest of the mail, and batched with all the other people are shipping to the US, and then delivered to your door with the rest of the mail.
I can't imagine that there's a significant environmental impact outside of what it already takes for normal imports and and your daily mail.
Of course it gets shipped with others, and if delivery takes weeks or months, it probably gets shipped fairly efficiently by sea. But it still gets shipped over a long distance. I'd rather see more local products and less intercontinental shipment except in cases where it's unavoidable.
Besides, a lot of products on AliExpress don't actually meet western safety standards. They're not allowed to be imported and sold here, but you can buy them abroad and ship them to a private customer. But they still won't meet our standards.
Huge difference. Products that are intended to be sold overseas are made to comply with the recipient country's safety standards (although the Chinese are notorious for cheating around that in every way they can and quality control + liability is ultimately up to the importer). Random shit that you buy on alibaba, isn't.
There are several entire youtube channels dedicated to dismantling chinesium gadgets and showing how they'll burn your house down. Lack of reverse current protection, lack of overcurrent protection, trace spacing that's way too small and will arc under the right temp/humidity, mains side traces right next to each other, no grounding, ground shorted to neutral, under-rated caps and resistors that reach unsafely high temperatures, etc, etc.
There is an important difference between products built there and sold there, and products built there and sold here. The product have to obey safety and other standards of the country where they're sold. And those standards differ quite a lot between the EU and China. They can use banned chemicals, and fail many other requirements.
In the EU, products that conform to EU standards can be identified with a 'CE' logo[0], which means "Conformité Européenne". "Chinese Export" can have a deceptively similar logo[1] that does not guarantee such adherence at all, but still looks comforting to European customers of Chinese web shops. It's a blatant violation, but hard to stop, because it's a foreign sale shipped to private customers.
Whether or not it exists seems to be mostly a matter of interpretation. Is the incorrect mark just a misprint while Chinese products with the correct mark are just as likely to fail to meet EU standards? Either way, that cheap products from China regularly fail the standards does not seem to be disputed by anyone. And if those products are sold in the EU, it's fairly easy to address, but if they're sold in China and mailed to the EU, it's not so easy to enforce. The problem remains the same, whether or not you see it as intentional or not.
It's the difference between deliberate (creating a confusing mark to legalistically "bypass" CE regulations - this is the myth) and negligence (China not bothering to enforce the standards set by other countries or even its own quality and safety standards - this is well known).
Germany seems to care more than other EU countries about such things like CE. They don't have trouble turning away imports based just because it's shipped to private customers.
Just ask people trying to receive PinePhones in Germany.
You don't have a german manual? Bye bye, try again later.
There may be ways to be greener by manufacturing near consumers... but that doesn't have much to do with amazon vs alibaba. These products are manufactured in the same places.
Not sure what tree you think I'm barking up. I do think the issue of local production and less transportation is an important issue; not everything is just about Amazon and Alibaba. But even if you just focus on those, Amazon at least has to obey local standards for the country in which they sell. Products from Aliexpress only obey Chinese standards, which are very different. And sometimes they ship with misleading logos which could suggest to European customers that they obey EU rules when they don't.
True. Amazon also clearly has a problem with counterfeit goods (as addressed on HN repeatedly in the past), and that's not sufficiently enforced. But at least it's possible to enforce. That's not to easy when the shop is outside your jurisdiction.
Counterfeits are generally not locally produced and mostly come from China via the subsidized slow boat. The counterfeit industry exists on Amazon because the potential for profit is so high and the risk is almost non-existent.
This article is not just about postage. It's about how cheap postage from China has subsidized Chinese webshops selling cheap crap to Europe and the US.
Just in terms of packaging waste it is definitely lower. Even tiny things from Amazon often come to me in a shoebox sized carboard box, even if they could have fit in a padded envelope or maybe even just shipped in the retail box. Ali Express things I have ordered almost universally come in a padded plastic envelope. I think there must be strong incentives to pack small and light, so the maximum amount of stuff fits in the container, whereas with Amazon the highest priority is to get it on the truck ASAP.
There was a popular blog post awhile ago where a guy wrote a script to buy a random item for $0.99 everyday. It would automatically get sent to his house and so he was always getting surprise deliveries since the script would decide what to buy.
just checked taobao.com, the cheapest phone case was 5 RMB or $0.7 USD including shipping. so it is actually cheaper to buy the same stuff from the US and get it shipped half of the world.
In the case of phone cases, you can get Chinese domestic
shipping costs as low as $0.2 if your daily volume is high enough. It's a special offer tho, since it's light weight and compact.
And yes, shipping companies can still make normal profit on these.
From this standpoint, your example isn't nearly the cheapest it can get. Sellers regularly offer entirely free ones in exchange for reviews.
After RadioShack collapsed and Fry's turned into a Cellphone store (note: RadioShack also pivoted towards Cellphones before it died), the only place I could buy a 2 pack of capacitors for a few cents + free shipping was on eBay or Aliexpress. If this "hole" is closed it makes me a little sad.
I used to buy costume jewelry for my kid (before deciding cheap metals on my kids skin is probably a really bad idea) from eBay and would search for jewelry listings ending in an hour and search for anything under a dollar and with free shipping. I would bid on them last second and try win. I have had a 5cent phone case sent to me and thought this is insane. It was like a game just to see if I could win because I was bidding pennies and shipping always free.
No, but the customer service is still unparalleled. I ordered a cable, and the one I got wasn't the one I ordered. I clicked three buttons, (link from the email to my order, return product, and chose "product not what was descrived" as the reason) and I had a refund as Amazon credit, without having to return the item instantly. If you're talking about the $/£5-10 phone case/misc cable market, ordering off amazon is significantly less hassle then the alternatives (going to a random "phone shop" on the high street, ordering from eBay, or ordering from AliExpress), and likely as error prone.
I have never had a problem getting partial to full refunds on Ali Express. Even if I never got a refund though, I think I would still come out ahead due to how much lower the prices are.
Break even, assuming you could never get a refund, would be if the failure rate and average discount were the same. My experience is that the discount is >60% and failure rate is <15%.
> I have never had a problem getting partial to full refunds on Ali Express
I've never really had an issue with online refunds anywhere. That doesn't mean Amazon's experience isn't superior. Amazon's policy of refund first, ask questions later (for stuff in the <£15 category at least) means that I don't really consider the other options.
If I have a choice between buying a USB to DC5v adapter from amazon for £3.99, with next day delivery, and I know that if it's not the right cable I'll get an instant refund, or from aliexpress where it's £1.99 [0] but I have to wait 30-50 days for it to arrive, plus 3 weeks for a refund if it doesn't work, I'm just going to buy it on amazon. I don't care if I don't come out ahead!
You should look into getting a 3D printer. I’ve found that most of the time I can just easily print the random things I would normally buy on amazon (cases, organizers, etc). And if I can’t find a good design already online, I’ll try to make it myself. Really fun hobby.
I may be off by an order of magnitude somewhere. But it just feels intuitively obvious that most of the costs of any delivery are incurred during the 15 seconds or so the mailman spends in your driveway or trying to find the mailbox with your name.
No, that's about right - containerised freight is extremely cheap. I just shipped an ATV, about 1.5m3, 250kg, from China to Europe for about $180 - and $150 of that is port handling and freight forwarding fees, the actual shipping part was $32.
Just last week I checked ocean freight rates again for a project of mine. Depending on ports and incoterms, handling charges, port fess, etc on both ends can almost amount to the same sum as the shipping part.
You're paying the same amount of tax either way. If the shipping costs $1 from govt. money, then that gets split over the many millions of taxpayers. So while the system is bad, for you it's good - you're getting effectively free shipping funded 99.999% by everyone else.
What tax dollars are you talking about here? The USPS is only in the red because of congressionally mandated pension funding requirements. It’s a business otherwise. Not sure why everybody’s talking about tax dollars.
They are required by law to fund 75 years of their pension obligations. Because of this, they run in the red, not because the business model is completely flawed.
Further, rural routes are things that should continue but are cost prohibitive without subsidies. With those two considerations combined it seems like a pretty meager use of taxpayer dollars.
You’re not wrong. I think the concern can still be valid that the use of those taxes isn’t good, though. While some people get an alright deal out of a single shipment, the overall situation isn’t necessarily justified or beneficial.
The trouble is that we are subsidizing the shipment of items from China. It’s sickening when I have to pay $5 to send something within the US, yet the same item would cost $.50 from China. You could buy something for $1 from dx.com- shipping included! Crazy.
So while I agree with you that we don’t necessarily need a profit motive at the usps, at the same time the taxpayers don’t need to subsidize cheap crap from China.
Not only that, but it creates an anti competitive environment where someone like me, who sells to US customers, subsidizes those shipments from other countries.
I guess the taxpayers are also the people who buy stuff from China so by and large they're just subsidizing themselves?
Given how ubiquitous ordering stuff from China is these days I'm not really sure the first impression of this being some good deal is accurate.
In fact subsidizing transport to a degree might probably have a progressive effect because low wage earners are more likely to order cheaper foreign goods.
Both the seller and the buyer benefits from the subsidy, while only the taxpayer pays for it. So the net benefit is to the chinese seller and net loss is to the taxpayers, which only partly mitigated if they are buyers too.
I would make the case that they do receive taxpayer money. They have a legal right and monopoly to show ads in your mailbox. Without that, they would not exist. Imagine if Facebook were legally allowed to drive by your house and play recordings of ads over a loudspeaker every morning. Facebook would pay the government for that privilege. The government is selling your attention daily (worth billions, if anyone company were to have the ability to charge for it the same way), and giving it to the post office for free.
The environment suffers though. Shipping it in bulk to the US and from there to the customer is more efficient and allows for returns to be reused, creating less waste.
If people had to make an explicit choice between ($1 shipping cost and $2 taxes) vs ($2 shipping cost and $0 taxes) they'd choose the unsubsidised option.
"they're just subsidizing themselves" -> they are spending money that they wouldn't choose to spend if they had fine grained control over the taxes they paid.
For lots of things, though, that really isn't the clear cut choice.
You pay health insurance so you don't have to pay the full cost later on. And it could easily be that the shipping cost + taxes generally means that the system stays afloat. And besides, if you tax correctly, it wouldn't be the same rate for everyone (income taxes should be higher for those making more, for example) nor would it be more than the flat shipping costs so long as the tax money actually went to the postal service.
In both cases, are the employees getting paid fair wages?
Does the tax mean I'm not getting charged for receiving packages? Are there hidden costs to the lower amount?
> You pay health insurance so you don't have to pay the full cost later on.
When you buy health insurance you pay more than the expected value of the full cost, both as a result of the cost of providing the insurance and the over-consumption as a result of insurance making patients price insensitive.
The reason you buy insurance is in case your medical bills are more than average and you can't afford them. For the average person the insurance is a net loss but the cost savings of not having it aren't worth the risk.
> And it could easily be that the shipping cost + taxes generally means that the system stays afloat.
If the system is worth more than it costs then it will be able to charge prices that allow it to stay afloat. We generally don't need systems that cost more than they're worth.
> And besides, if you tax correctly, it wouldn't be the same rate for everyone (income taxes should be higher for those making more, for example) nor would it be more than the flat shipping costs so long as the tax money actually went to the postal service.
Everybody always wants somebody else to pay for it. But it's the people in the middle and not at the top who actually pay for stuff, because they're the only ones numerous enough to do it.
> In both cases, are the employees getting paid fair wages?
That sounds like a question for the employees and not the customers. Naturally if they're getting paid below market rates they should consider seeking other employment.
> Does the tax mean I'm not getting charged for receiving packages?
You can already get charged for receiving packages. It's called COD. Nobody really uses it because it's much more convenient to charge up front than have the carrier try to collect payment from the recipient.
I see your pount about insurance but would love if health insurance and medical costs were more transparent.
In some countries without mandatory health insurance, medical cost is a lot lower and simpler. If major medical emergency happens, then families usually need to take out a loan. But for regular medical issues, you save for it. This includes issues like childbirth which in America very few people can afford without insurance.
I imagine, having health or car insurances gives some sense of false security, which leads to poor lifestyle choices or driving fast, which in turn causes one to experience bad health or accidents, thus using their insurance. Which causes insurance rates to rise. And one is not directly negotiating with hospital or bodyshop, those prices rises too.
It isn't mandatory health insurance that makes it more expensive: I have taxpayer funded insurance, which basically makes it mandatory for most (some folks don't qualify if you are a certain category of immigrant, but you still have to have it). There is a private option if you want to pay extra.
... And the system is more efficient because of standardization and pooling money together.
The US system doesn't have much of any standardization, and in general has a lot more facilities than it might otherwise need - plus things like some of the government provided insurance not paying enough and not having the ability to act like public insurances. These all make it more expensive. Heck, even standardizing insurance coding would help.
It is cruel to expect folks to take out a loan for medical emergencies. In some places, you die if you can't pay. It isn't like health is completely under your control: Type I diabetics couldn't prevent it (for example). Many cancers can't be avoided. And so on.
Negotiating with medical facilities is a pipe dream. There are many cases where you simply don't have the choice (emergency) nor the mental space to do it (for example, do you know how to judge what facilities are better for a gall bladdar removal surgery? How about where to get cancer treatment? How does one judge any of that?)
Does care insurance cause you to drive fast? Seriously? Isn't that more cultural than whether or not you have insurance?
I think the point is that part of the reason the goods are cheaper foreign is because they can't be made here at all, when shipping is 5x more expensive than importing from China.
according to statista[1], the average weight of cross-border packages is about 1 lbs or so, so according to that table shipping from China would be about 1$ cheaper. As the article itself states
"You can see from the above anything under 4 ounces is actually cheaper to ship from China. From 4 ounces to 8 ounces the rates are pretty comparable. Once you start hitting about 2 lbs, the prices from shipping within the U.S. start to get comparatively cheaper and cheaper than shipping from within China."
I seriously doubt this was ever an existential in the sense of the shipping cost itself destroying a business. China is simply able to produce cheaper things because they have lower labour cost and so on, and that is actually good for American consumers. It's simply free trade.
If anything I see a much bigger threat in the ability of the US to raise the prices, because given the current administration it may be used as a protectionist tool.
How can it possibly be free trade if one side is subsidized and one side is not.
This is a good thing, I hope same thing will happen in Europe, if it haven't already. The law/agreement in europe is to help people send hand written letters across the globe, and to help people from poor regions send letters ro the more developed regions on earth.
This was the case back then, now, the same agreement is used so that you can send stuff worldwide without any fee. That is NOT free trade.
If you are concerned about maintaining access to the international post system for poor people, how is this change going to help?
Surely it does the opposite - someone living in the poorest country in world would have to pay rich-European country rates to access their postage system.
Btw. I strongly suspect that the international rules on charging for postage were chosen for simplicity of implementation and not out of a sense of altruism for people in poor countries.
How usual is it sending hand written letters in 2020? Even in poor countries, I believe people sending hand written letters across the world is very uncommon.
If you believe it's still neccessary to keep sending letters across the world a neccessity, well, then we could only allow thin letters that can not hold anything else than a written letter - no items, what so ever.
I didn't mention hand-written letters at all so I've no idea why you're asking that question.
Your original message seemed to express concern that the original purpose of the rules for international shipping was to support people in poorer countries?
If this cross-subsidisation is removed, then people in poorer countries will pay more and people in richer countries will pay less to send stuff to each other. That's simple arithmetic.
And I was wondering how someone could simultaneously support such a policy while expressing concern about access to international post in poorer countries.
Sure, you didn't mention hand-written letters, but hand-written letters is exactly what the agreement/law (in europe) was designed to take care of.[0] So I think you are missing my point.
It was definetly not designed to be abused by the world's biggest companies to be able to ship stuff for near zero cost world-wide. If you can't see how it's clearly being abused, I don't know what to say.
A trade union created in the late 1800's that made sense then, may need a change now. Although alot of damage is already made.
> I seriously doubt this was ever an existential in the sense of the shipping cost itself destroying a business.
I've read many e-commerce blogs with US sellers lamenting that they can't compete with China on $5 items because shipping costs are 5X as much within US. Maybe not killing businesses, but definitely keeping many out of the market.
> China is simply able to produce cheaper things because they have lower labour cost and so on, and that is actually good for American consumers
Lower, but not nearly as low as it used to be. Minimum wage in China is almost 1/2 of US now.
There's real instances of shipping cost offsetting lower labor. Manhole covers are a somewhat famous example. They're still made in USA because shipping offsets increased labor and materials. Would it be the same for ecommerce? I'm not aware of any studies but to me, the increased cost and shipping time make it plausible
If you want cheaper products with lower shipment costs, why not subsidise them locally? Why pay to make buying abroad cheaper while making your local products more expensive?
If you're creative, you can have free local shipping too, or just pay $2-4 to get shipped pretty much anything. It's just sligtly more expensive than standard aliexpress shipping, which is $1.5 or so.
The major thing compared to local stuff is lack of VAT on cheap foregin goods. Noone locally can compete with that.
Also most of the stuff I buy on Aliexpress (electronic components, SBCs, ...) simply isn't available locally, or is simply bought there and resold locally (because the manufacturer's main shop is Aliexpress).
There were a truckload of articles on this published over the last several years, even during the Obama administration, on how this "international China shipping" being cheaper than "domestic shipping" destroyed small businesses and was also responsible for hundreds (likely thousands) of American deaths thanks to cheap fentayl shipments.
This was the most nonsensical self-destructive American policy that strangely never caught much mainstream media attention.
With the potency to weight ratio Fentanyl has, do you really think the shipping being slightly more expensive will make it cost prohibitive? "A kilogram of heroin is purchased for approximately $6,000 and sold for appropriately $80,000." [1] Paying a few more dollars for shipping, which would be the case, doesn't make a dent in profitability.
I'm not sure if you read the article you linked. It clearly refers to easier smuggling. If it was possible to just "ship" heroin then those profit margins wouldn't exist. The heroin would be bought for $6k and sold for say $6.5k. The reason why it sells for that much is because a substantial portion of the margin is spent on smuggling.
I am truly disappointed at the downvotes and the complete lack of research done by down-voters. The answer to your question is "Yes" not because of cost prohibition - but because most fentayl imports are less than 700 grams - which get lost in the massive flood of UPS e-Packet shipments and thus near impossible to inspect. I beg you to carry out your own research before expressing such disbelief.
"The illicit trade follows the standard e-commerce model of small-scale shipments and B2C and B2B distribution channels. The trade is SME-focused, with small-scale Chinese suppliers primarily exporting to individuals and small independent U.S. criminal networks.China was the source of 97 percent of inbound shipments of high-purity fentanyl during 2016 and 2017"
"Given the high purity of Chinese fentanyl, most illicit imports are less than 700 grams (1.5 lbs.) per shipment. "
> I am truly disappointed at at the downvotes and the complete lack of research done by down-voters. The answer to your question is "Yes" not because of cost prohibition - but because most fentayl imports are less than 700 grams - which get lost in the massive flood of UPS e-Packet shipments and thus near impossible to inspect.
So what? 100 grams would be bought, by the numbers above, for $600 and sold for $8,000. If shipping cost $200, no one would care. That would add $2,000 in shipping costs to the full kilogram, but, again, no one would care. It's just not significant.
Do you have an argument to advance that isn't ludicrous on its face?
I guess that if shipping cost $200, only very lucrative goods like fentanyl would be shipped. That would reduce that the total shipping volume to something that was possible for the border guards to inspect in order to find drugs.
>> There were a truckload of articles [...] on how this "international China shipping" being cheaper than "domestic shipping" destroyed small businesses
> It is not a matter of the shipping cost.
Seems like your original point was centered on shipping costs destroying domestic businesses. In light of the downvotes it became mostly a matter of drug imports in small, cheap packages:
> most fentayl imports are less than 700 grams - which get lost in the massive flood of UPS e-Packet shipments and thus near impossible to inspect
Which is irrelevant, shipping costs (within reason) won't change this.
"Seems like your original point was centered on shipping costs"
I made both points right at the beginning, though the thread got focused around one of them.
1. e-packet shipping cost adversely affecting US businesses
2. e-packet being used to hide fentayl shipments thanks to massive volume and delivery convenience. (cheap and fast)
"Which is irrelevant, this will be the case regardless of the shipping costs, within reason."
I fail to understand this statement. How will reduction of e-packets - one of the major causes of the bloat of international packages not help in inspection ?
If you reduce the total number of e-packets by removing the subsidy, then it becomes far easier to inspect which packages have fentayl and which do not. EMS shipments apparently quadrupled after the e-packet scheme was introduced which adversely affected all inspection procedures as agencies could not cope with the volume.
Reduce the volume by removing the subsidy - the inspection agencies can then manage their job.
So we can agree the shipping isn't make it cost prohibitive. Your point about there being less hay making finding needles easier might be possible (although I don't think it matters, as with our southern border, a higher detection rate just means you need more chance to get the desired total smuggled). I would imagine there would just be more product shipped to Central and South America and then imported like everything else south of the border, cars, trucks, boats planes. "The flow of fentanyl to the United States in the near future will probably continue to be diversified" [1] Production in those places might also increase. Moral of my story is this change in shipping prices will have no long term effect on amount of fentanyl brought into the US; though, it might very well increase the involvement of SotB cartels. If there are buyers, these will be sellers.
Perhaps, but until those supply chains are established and proven to be effective, one should address the way 97% of all fentayl enters the US today - e-packet from China.
Just because opponents will likely evolve their tactics in the future should not prevent one from mitigating their extraordinarily successful tactic that is running in the present.
In FY 2012, USPS handled about 27 million ePackets from China. This increased to nearly 500 million ePackets by 2017. (Thanks to that disastrous subsidy agreement in 2011)
None of our inspection agencies could cope with this volume. Remove the discount-from-China subsidy, this will automatically reduce the volume of all e-packets and thus will ameliorate the load on inspection agencies.
The supply chains from Central and South America are already established and proven to be effective. What you seem to be ignoring is the demand part of supply and demand. If there is demand, there will be people importing drugs, increasing USPS pricing won't stop anything that from happening.
I think even if you reduced volume to 2012 levels its not going to make any practical difference. Like, 1 gram of pure fentanyl is on the order of 1000+ doses... You can profitably smurf it in anything.
The rates are set because Republicans want to have the postal service die and be fully privatized, and thus make regulstions to sabatoge it on a regular basis.
> It’s sickening when I have to pay $5 to send something within the US, yet the same item would cost $.50 from China.
What's sickening about this? It's different quality of service. Your $5 package will be received in a few days. With $.50 shipping, your Chinese trinket will be delivered in a couple of months.
> So while I agree with you that we don’t necessarily need a profit motive at the usps, at the same time the taxpayers don’t need to subsidize cheap crap from China.
Too late for that. China is world's manufactory. Your stuff will be shipped from China one way or another.
Given that, subsidising direct shipping from China is the reasonable thing to do. Otherwise you will be paying a 5-10x markup to middlemen for the exact same item.
All the slow Chinese mail gets put on a boat, and taken to say a port in LA where it is offloaded and then inserted into the US mail system. If I bring a package to that same spot in LA where the packages enter the system, why can't I choose a shipping option that costs something less than 50 cents to anywhere in the US?
The system was illogical. Whether you want to say that US shipping is too expensive, or Chinese shipping to the US too inexpensive is unimportant.
> why can't I choose a shipping option that costs something less than 50 cents to anywhere in the US?
Not an American, but I believe there's a 2006 bill that prevents USPS from selling services below the cost. Learned about it in a John Oliver's video [1], mentioned somewhere else in this thread. I'd guess that Chinese epackets are part of an international agreement, so they are exempt.
> The system was illogical.
It would be illogical if USPS had flexible costs.
But the USPS costs are more or less fixed. The mailman will go his round every day and will get his salary, even if he has little to deliver. So, you may as well have him deliver Chinese epackets, for whatever price the Chinese are willing to pay. And that's a good deal for the public. Otherwise the $1 trinket for China would be $6 (if Chinese had to pay full shipping), or $10 (if bought through a US-based reseller).
I think that’s only true until it arrives in the US though and USPS delivers the package to your door. Sure, total time is long, but the cost to USPS seems similar?
I'd bet this has to do with capacity, similar with network equipment. If you operate below capacity, it's hard to tell apart a high priority packet from a low priority one. You will start noticing delays in low priority packets only when you start saturating your network capacity.
But it's the mail. It simply arrives. If I am in some other country, I pay postage in that country, then that country gives it to USPS and says "your turn now". Are they going to send it back? Surely there can be negotiations between the two countries about how to split that cost paid overseas, but at the end of the day the mail comes in, what are we going to do, not deliver?
If domestic mail is too expensive maybe let's address that.
Accept it in harbor, send a new notification that it can be fetched after paying a processing fee (which includes the price of three previous notification).
It's not like that isn't already done all over the place.
It's not like that would happen often. They'd quickly adapt and start charging more for sending, making it a non-issue most of the time
>The trouble is that we are subsidizing the shipment of items from China.
I don't see any problem if taxpayer is the one is paying cheaper price as the end result. It's not like Chinese are charging full rate and sending for dirt cheap and booking mega profits like that.
And if a student can order cheaper pen and paper from china or a mechanic can order cheaper nut bolts and screwdriver from china, what's the harm?
There is definitely a problem with subsidising the destruction of US small-scale businesses while favouring Chinese businesses and subsidising death of American citizens via fentayl.
>There is definitely a problem with subsidising the destruction of US small-scale businesses while favouring Chinese businesses and subsidising death of American citizens via fentayl.
You can find extreme examples in anything.
But let me tell you, sometime back I was unemployed. I bought machining tools from china and setup a good business, I could have never been able to afford local manufactured tools without accuring debt.
I paid a lot of money in taxes as my business grew, I bought better quality machines which were locally available from local suppliers because local suppliers ensures a maintenance package.
> subsidising death of American citizens via fentayl.
LOL, do you really think people buy chinese fentanyl 'cos the shipping per gram is a few cents cheaper than it would be if they had to pay higher shipping rents?
No, the problem is that the drugs disappear in the flood of cheap legal packages sent because it's so cheap to send small items.
It also contributes to the dismounting of American industry. When the poor people can't make any money to buy things made in USA because their jobs got exported to China, the next level of workers in USA will also lose their jobs and this will just continue for the next level and sooner or later hit the software world too.
I made a terrible mistake by my short, snarky answers without citations because I mistakenly assumed that most people were already aware of this. But it seems that I was utterly wrong. (also I did not downvote you)
"The preferred method of the international online (fentayl) sellers is Express Mail Service (“EMS”), a global delivery service for documents and merchandise contained in letters and package."
Further reading in that report will show you how difficult it was to scan/inspect e-packet shipments due to immense volume.
It costs significantly less to send a lightweight package, via the USPS, from China to the U.S. than it does to send it within the U.S.
There's no reason American taxpayers and postal rate payers should be subsidizing shipping costs for Chinese Ebay/Amazon merchants at the expense of their American competitors.
No they're not. The reason it's so cheap is that the UPU forced the U.S. to offer these rates. As a result, the U.S. threatened to leave the UPU so that the USPS could adjust the rates to be more equitable.
Once upon a time, the US agreed to these rates, because at the time they were reasonable. The idea was that developing countries would be held back if they had to pay the full cost of international mail. To help them, the relatively low volume of mail from developing countries would be subsidised a bit by the country it was mailed to.
But China isn't a developing country anymore; it's the #2 economy of the world. And the volume isn't small either. The rule should not apply to them, but it's hard to change.
Its slightly ridiculous that a company in the same city as me has to pay more to mail me a package than a company in China. Especially if the difference in shipping costs is subsidized by American taxpayers. I'm not crazy about tariffs, but I'm even less crazy about the idea of the USPS giving foreign companies such a huge advantage over domestic ones
Why is ridiculous or even remarkable? Pretty much every 3rd party service that an American-based company uses costs significantly more than an equivalent in China. And most of these costs are far more significant than the cost of postage (e.g. wages and salaries, rents, etc.) unless you're involved in a very low value-add business.
I find it ridiculous because it's not a comparison between the USPS and a similar service in China. Both companies are getting the same service in America, but the foreign companies get it much more cheaply. To the point that shipping something from China to the US, then from the US to me is cheaper than an American company shipping something directly to me. I'm guilty of buying plenty of $1-$2 dollar knicknacks with free epacket shipping on AliExpress. An American company can't even compete, because shipping alone is going to cost them more than the $1-$2 I paid for the Chinese item
Practically they don’t need to be profitable since we print our own currency. As Prof. Stephanie Kelton puts it “the governments red ink is our black ink.” But politically when US politicians want to attack a popular service, they use analogies to home economics to manufacture a crisis.
Because she's one of the biggest proponents of Modern Monetary Theory and most economists view it as snake-oil. MMT claims to offers a fix/cure all our economic problems - everyone can have limitless money to spend as long as "sovereign" governments are the ones handing out the free money. And like snake-oil theories it collapses under the mildest of empirical tests.
More specifically, it draws a bogus conclusion from a true premise using an assumption that wouldn't be true anymore if their policies were enacted. The government can indeed print money and government debt is private savings - what it can't do is print resources. The USPS uses a whole bunch of sorting offices and equipment and vans and people's time which cannot just be magicked out of nowhere by the government. They all consume scarce resources that can't be used for anything else. The same is true of the USPS staff's healthcare and retirement - again, a whole bunch of resources. We're used to the fact that money represents a claim on real things at a rate that only slowly declines due to inflation because government fiscal policy is carefully managed to ensure that by not printing too much or too little money.
In my opinion a public service doesn't need to be profitable at all, as long as it provides benefits in more important areas. I'm all for free education and free public transport and all that.
But in this case, the US (and EU) are subsidizing products that compete with local products, undercutting local products in price, in quality, and often not complying with safety standards, while also avoiding customs and sales taxes because the individual packages are too small to meet the limit.
You're basically supporting unfair competition, and paying to undermine your own quality standards and taxes. There's no benefit at all to the country that's paying for this.
The Post Office is funded by those that use it, not Tax Dollars.
The poor rate structure and widely publicized losses are due to artificial and quite excessive benefit pre pay mandates going out decades and a rate structure mandated by Congress for political reasons.
These changes were made during the Bush Administration.
1. The 2006 Postal Accountability and Enhancement Act (PAEA) had bipartisan support and was sponsored by two Democrats. It was not a Bush conspiracy.
2. It included a 10 year prepayment period. This ended in 2016. It is 2020. Current USPS financial woes have nothing to do with that act. We are now in the follow-on period in which the USPS is intended to be amortizing its remaining unfunded liability over 40 years, to 2056. And this 40 year amortization period is exactly the same length of time as private-sector employers are given.
3. The USPS gets ~$18 billion in taxpayer funding/subsidies annually.
Note: I made no mention of conspiracy, nor it being partisan.
Fact is both parties receive significant financial incentives aimed at privatizing the Post Office. There is no benefit to the American people down that path.
That analysis is incomplete and inaccurate. 3 is particularly egregious. Compute it prior to the act, and the arguments evaporate.
Another fact: That bill was, and remains unnecessary, and is intended to undermine an otherwise exemplary service.
If you remove the need for external funding, you also remove the political baggage that comes along with it. Cost centers in businesses are bad to be in because there is always someone around trying to squeeze you instead of support you.
And unlike police who, when trying to be profitable are driven by perverse incentives to be corrupt, the post office doing more business is hard to see as a bad thing.
Also as many others have mentioned, the Chinese shipping rates were much lower than domestic rates, to the level that cheap products made in the US couldn’t be given away for free cheaper than things could be imported from china. $0 + shipping cost more than similar products sold at a profit and shipped from China.
The postal service is one of the few gov't agencies explicitly created in the Constitution; it's vital to national cohesion and commerce (especially rural areas).
You're right that the deficit is mostly artificial, but since this has come up a lot recently it's important to point out that the USPS as an entity is not enshrined in the constitution. The postal clause says:
> The Congress shall have Power...To establish Post Offices and post Roads
And that's it. The rest is left up to Congress to figure out; they could, if they chose, punt entirely and allow eg FedEx to run post offices. I think the USPS is vitally important, and we can make arguments for its role as a public good without being hyperbolic about it.
In FY 2019 the USPS lost $3.4 billion excluding all Congressionally mandated expenditures[1]. In 2018 they lost almost $2 billion, also excluding mandatory expenditures. The USPS's precarious financial situation is not artificial, it's the result of a long term decline in mail volume as correspondence increasingly shifts to electronic systems.
A nit: The postal service wasn't actually created in the Constitution. Congress is merely authorized to do so.
The artificial nature of the USPS's debt comes from the fact that congress passed an (unusual) requirement to make it prepay health & retirement benefits.
"The debt it carried jumped from $7 billion in 2008 to $10 billion in 2009. At the end of 2019, the GAO calculated that the Postal Service had $160.9 billion in debt, $119.3 billion of which came from retiree benefits"
https://www.washingtonpost.com/business/2020/04/15/postal-se...
I can't access the article, but don't postal employees get the same (unsustainable) retirement benefits as government employees? Of course the costs of those benefits are ballooning. The retirement age is far earlier than life expectancy; it's simple math. What alternative is proposed that would make it past a union sitting on 120B in benefit commitments already?
It is not necessarily that the retirement benefits are so extreme, it is that the Post Office singularly has a requirement to pre-fund its retirement fund massively in advance. No other agency is required to do so.
> I can't access the article, but don't postal employees get the same (unsustainable) retirement benefits as government employees?
Can you clarify? My understanding is that US Federal Employee retirement benefits (for new employees) have been comparable to private sector benefits since some point in the 80s, though existing employees at that time kept their old, more generous pension plan.
Unless you think the money to pay pensions will magically materialize out of thin air in the future, I don't see what's artificial about it. They have obligations to pay and recognize them.
>> The artificial nature of the USPS's debt comes from the fact that congress passed an (unusual) requirement to make it prepay health & retirement benefits.
> Unless you think the money to pay pensions will magically materialize out of thin air in the future, I don't see what's artificial about it. They have obligations to pay and recognize them.
My understanding is every other entity that has similar obligations is allowed to pay them as they go.
This isn't about a policy that costs money, and creates benefits. It's not even really a policy. It's a side effect of quasi-diplomatic arrangements created decades ago... with no relationship between original goals and current outcomes.
Maybe it makes sense to subsidize a national package delivery. IF so, they can make a policy that does this, but this one isn't it.
It doesn't need to be profitable, but I'd question the idea that the postal service, in particular, should be subsidized. Even without being subsidized, it has negative externalities that likely aren't being appropriately priced.
In a world where the mail is the only reliable of communication with the rest of the country, subsidizing the mail was important to improve basic quality of life in more remote, and more poor, parts of the country. This survives to this day in 'media mail' rates, which are heavily subsidized to allow things like books and periodicals to reach rural people.
However, in a world where basically 100% of the business of the postal service is junk advertising and amazon packages, subsidizing it is just a payout to business, and I agree that the externalities now greatly outweigh any social benefit.
Subsidies to bootstrap into economies of scale can make sense. When you go from filling 0.1 jets or 0.1 containers or 0.1 ships to filling 10.1 jets etc, the costs come down and usage (and utility) go up. See Amazon, and I guess Uber if they ever make it work.
Shipping from China is well past that point, though, it's clearly providing perverse incentives and it's good that it's changing.
There’s no reason for USPS to make a loss on this either.
I can absolutely see a situation where products being shipped from China are given cheaper rates than products shipped domestically. In fact, I expect that’s how it should be. Simply because for products from China, USPS would be tying up with the Chinese postal service, and due to the massive volumes they have, they would be able to offer extremely low rates that they couldn’t offer anyone in the US besides Amazon and Walmart maybe.
However, those rates should be profitable rates for USPS.
I think the American conception here is that if something is not profitable then it suggests the possibility that there is an alternative that provides the same utility but more efficiently.
I think the conception here is that if you are subsidizing something in a way that is purely a wealth transfer to business, you should stop subsidizing it.
So my original comment was really just offering up the mindset behind why Americans are averse to services "costing" money.
While I think your comment may have been imbuing a value judgement on my original comment where I wasn't making any.. it does bring up a good point. Obviously this mindset doesn't hold true across the board for all services.
The one that immediately comes to mind is farming. I think more people are averse to the idea of farmers/farming operations going bankrupt. I think most people would be fine with a pure wealth transfer to that industry to help it get through a massive downturn. But why does that industry get a general pass?
My guess is that food production is perceived as more of a core need than mail/package delivery. Even when mail/package delivery is an important part of a modern economy.
No it does not. An easy example to see is public medicine that treats poor people. You can't squeeze blood from a stone, but a healthy population is overall happier and able to do things. However, it doesn't make money directly for anyone. Since the 1970s, the popular ideology of the ruling class is that government has to work like a buisness, and is a facet of "neoliberalism" -- the idea that markets are the best tool for every situation despite the numerous problems with them.
In the US, the idea is to disdain public services unless they can be used to socialize a cost of doing business. The USPS has been allowed to function because it made shipping cheaper, which is the lifeblood of business. However, other political calculations are coming to the fore (such as international competition) so they are thinking of kneecapping cheap rates to China.
Besides losing money, the biggest thing that bothers me about USPS is the sheer volume of waste they deliver to my mailbox every month. That is a lot of diesel and gasoline burnt, not to mention raw materials to create the paper that it's printed on. We could make a massive dent in greenhouse emissions by charging actual prices.
You do realize the Post Office is entirely funded by Postage?
The "loss" is artificial, imposed by the Bush administration, which required the Post Office to prepay benefits so far in advance, that at the time of the decision, there were people not even born yet, who would go to work for the Post Office having bennies paid for now.
Frankly, the Post Office could meet that burden if it were not also for deep rate cuts that essentially force the Post Office to deliver for big publishing at a loss.
Yes, that volume is significant, and Congress is responsible for it, and the artificially low costs for it today.
The Post Office is in the Constitution and it must be run by the Federal Government.
Many in said government want to further privatize the Post Office which in every other way has given the nation exemplary performance, at respectable rates, while serving everyone equally.
I am always saddened, and a little bit disturbed, to see the hobbling and abuse directed toward a clear example of a public service delivering a net good so well.
Prior to that mess, the Post Office made regular and significant contributions to the treasury, funds to be part of the General Budget.
It is a shame to see leadership priorities and politics cause so much grief.
These ongoing games being played by Congress are expensive and should bot be tolerated by Americans who should demand a remedy so the otherwise exemplary service can continue as it has since the beginning.
There literally is no benefit to a private service being primary. State laws, etc... Federal govt is entirely appropriate here.
"it must be run" is not in the US constitution. That's the point I was disputng. The OPs comment is just as valid, and stronger, without this small hyperbolic statement.
Your comment about what oversight means, is separate and also not legal or factual. It's partisan comment that adds nothing.
And don't expect the postal services in the rest of the world to compare, the USPS is consistently ranked very highly in multiple metrics (speed, accuracy of delivery, cost, etc.) - not to mention we don't really have to worry about paying VAT/customs on most international orders.
I wouldn't place too much stock in that Fortune analysis (in fairness, it's apparently just a summary of a larger work). It looks pretty slanted in some ways that have become almost stereotypical.
An analysis that talks about "the subsidies and legal monopolies that Congress bestows upon the post office" without talking about their unique costs - being required to deliver first class mail just about everywhere, at prices mandated by Congress that represent a loss in many geographic areas - is incomplete.
Trump claims he's a self-made billionaire in the same way the post-office claims they're self-funded. If all of your expenses are paid for, and you're just reaping profit, you are far from self-funded.
The Post Office returned a nice profit to the treasury prior to Congress hobbling it during the Bush Administration.
There is nothing wrong with the otherwise exemplary Post Office, other than too many in both government and private industry don't like it and want it privatized.
They want that as an opportunity, not any meaningful benefit to the American people.
If there are extra taxes on tobacco and alcohol, there can damn sure be extra taxes on junk mail. Let's start at 5000% and adjust from there.
Or, put some sort of escrow/credit/thing in the opt-out mechanism. Where the sender has to swear on a stack of dollars that I actually want this. And if I do actually want this, cool, I keep receiving it, they keep their money. But if I opt out, then the sender forfeits their bet, and next time it's more expensive for them. This would incentivize senders to make their mailings carefully chosen or highly valuable (think bribes to the recipient), or both.
Really, what I want is a postal equivalent of that "button that shocks the shit out of someone on the internet". I would just lean a brick on the button until the junkmailers have smoke coming out their ears.
> there can damn sure be extra taxes on junk mail.
I'd imagine this would actually be quite difficult on first amendment grounds if you start filtering by sender / message contents and would sweep in things like paychecks if you don't.
I agree. I'd also say though that it might hasten digital adoption for some things - if a company had to pay extra to send a paycheck, they'd make you sign up for direct deposit. The lasting effect might be that those who are underbanked might be "forced" into digital bank accounts.
Here in Finland you can opt out of unaddressed bulk mail by adding a "no ads" note on your mailbox/mailslot.
99%+ of bulk mail is unaddressed here (addressed mail would be more expensive and senders would need address databases etc.).
Actually, no...
The post office is not allowed to stop mail addressed to 'occupant'. That's all I get, stupid supermarket flyers that require me to go check the mail simply to ignore them. I ended up paying for a PO box, and now only have to check it once every 3-4 months.
I think that "occupant" still counts as addressed if it also has a street address etc.. By unaddressed I mean that there is no address at all, they are just delivered to every mailbox in a specific area (except for "no ads" boxes).
No address? That doesn't happen - is it still the post office delivering unmarked mail? That would be illegal here since only the USPS can legally use mailboxes.
With this service the USPS is adding addresses from its database based on the area(s) the customer selects. It's not mail with no address showing up in people's mailboxes.
EDDM is not addressed, I get it in my mailbox every week and it absolutely is not addressed -- read further down the page I linked:
> Mailpieces are simply addressed to "Postal Customer" and your mail will be delivered to every address on your selected routes.
The area the customer selects are carrier routes. When you select a route, the carrier is given a stack of your fliers and they simply hand one out to each address.
In many European countries (all that I'm aware of), anyone can use a mailbox. You can deliver mail personally, there sometimes are local mail delivery services and they're used for advertising. In the end that makes it easier to avoid Spam as you can opt out of anything not sent to you directly.
I mean, sure, it’s wasteful, and I’d love for the post office to go electric. In comparison to all the waste that goes on to support every other aspect of my American way of life, however, it is absolutely microscopic. I’d rather we direct our collective outrage towards banning all new gasoline vehicles and subsidizing the rapid electrification of our infrastructure.
Actual prices for bulk mail, that is. It costs a lot less to deliver the same piece of mail into 1000 adjacent mailboxes than it does to send 1000 letters to different addresses around the country.
Bulk mail is on the order of half the retail price of postage. So it is still a big part of their revenue. And you can get the commercial discount rate by printing your own postage at home for one off packages. If you are mailing 100+ things a month, presorting them etc, you can pay bulk rates too
As others have noted, the fact that bulk mail rates are lower per piece does not mean the postal service isn't making money or that the price is less than the marginal cost. Junk mail is a cash cow for USPS, and it couldn't survive without it unless it raised prices on normal mail.
I always thought bulk mail made more money than first class just by sheer volume of how much bulk mail is sent but color me surprised that in FY2019 marketing mail made up a significantly smaller dollar amount than first class mail.
First class mail just barely edges out shipping packages here.
Those discounted rates are still profitable. The margin is small, and they make it up in volume. There’s an economy of scale to be had when every single person on the route gets the same bundle of local grocery ads, whereas if I send a first class letter, that has to actually be sorted and delivered to a specific address, potentially across the country.
Random aside. It's hilarious to me how people are worried about data Facebook has on them, or freaking out about address data being leaked in a hack.
Direct mail marketers, since the 1980s, buy lists of huge swathes of Americans. These lists include full name, address, estimated income, political affiliation, companies you've worked for - and the records are pennies each.
Quite possibly. For example, the Obama campaign in 2012 used friendship and interaction data from Facebook in order to figure out which of his supporters could most effectively convince specific undecided voters they were friends with to vote for him and instructed them to do so, effectively turning your own friends into instruments of the advertising algorithm. The New York Times ran a glowing article about how clever this was and the new commercial advertising organisation they were using their techniques in: https://www.nytimes.com/2013/06/23/magazine/the-obama-campai...
tbh, there's an upper cap on how much information an individual is worth.
Say a pretty basic personal information (address, income etc) cost a dime each person, it can get deeper and deeper until it is no longer worth any extra. 10 political opinion from this person? Interesting. Full reddit history? Maybe worth 2x the former. Facebook images? probably worthless. The point is that it quickly gets to the point where all of these information are noise and essentially worthless to an advertiser.
It is completely another story when you have people with authoritarian intentions coming in though.
> It is completely another story when you have people with authoritarian intentions coming in though.
The Nazi party went from ~2-3% of the vote to 37% of the vote in 4 years [0]. 5 years from 2-3% to the last election they had to contend with.
If the strategy is to wait for people with authoritarian intentions to come though before getting worried about privacy it will be far to late; things can go south extremely quickly. It is advised to stop the databases being developed before it becomes obvious that someone is abusing them.
With the 'minor exception' of Cambridge Analytica (and whoever else was given access and FB managed to put a lid on it). So yes, FB does sell (your) data. Perhaps the trade is not "$5 per account" but they don't "just sell ads".
People really need to pay attention to the permissions they grant apps to their Facebook accounts.
What happened was people installing a quiz app or game which requested unnecessary data access but collected profile data and then (against Terms of Service) provided this data to a third party.
I don't consider this Facebook selling data. And auditing this kind of behavior is incredibly difficult.
Don't install apps that request access to your data, especially if you don't understand who owns the app and what their motivations are.
This is why I mentioned that the sale is not (e.g.) $5 per user. But if someone has access to 1000 users' data and pays $5000 for that access, well, it's kinda the same thing.
Auditing such process is a joke. No such audit will ever exist, as the results would be documented and leave a trail of misappropriation and abuse (of data). The only audits 'allowed' by the business would me the innocuous ITGCs.
I invite anyone from FB with audit related experience to comment (please use a TA account and be as vague as you can to prevent tracing).
you make it sound like facebook was innocent here.
Facebook build api and functionality that enabled data to be slurped, they also build how the warnings of what data is being exported to whom are displayed (or not).
Further more, since they control all the data in the first place it wouldn't be difficult for them to show a page that shows exactly which entity accessed what data they have on you.
Bottom line is that this whole mess couldn't happen without Facebook deliberately making decisions that enabled it.
And I know some of the smart people that worked there at that time. I don't believe for a second that nobody at Facebook had any idea what was happening.
Facebook made the data "slurpable" because techies at the time were demanding FB be more open with their data instead of being a walled garden. That was the programming community zeitgeist at the time.
>It's hilarious to me how people are worried about data Facebook has on them, or freaking out about address data being leaked in a hack.
Several reasons...
(1) Facebook/Alphabet have a lot more data. Leaking anything implies something about data security, which is scarier.
(2) Scale. Direct marketers in the 80s did use most of the techniques digital markets use, definitely in the early stages. The scale is totally different though. I'm pretty sure my city (dublin) produces more "digital marketing" grads than all engineering specialities combined.
(3) Power at Scale. Your address is not data, it's a datum. Your address, alongside lots of other data about your, alongside data about lots of other people... that's where data becomes powerful.
Prediction, in advertising, is the demonstration. It's responsible for most of FB's revenue.
For me it is even more hilarious, that people have no problem with Google, Facebook, TikTok et al. having that data, just to name a few. An at the same time they are panicking the second something like a Corona tracing app comes out, because of government.
This whole saga shows us a lot about the institutional shitshow at the base, mechanical level of the economy.
FYI, this is not an anomaly. In Israel, amazon did a deal with the national postal service that gives amazon packages priority. Before that, Aliexpress' free delivery ruled. It's easier in Israel, because there isn't a local amazon to compete with faster shipping.
Long story short, local businesses pay much more, for slower local delivery than global companies shipping internationally. This is on top of de facto exemptions from duties & product regulations.
Israel is a tiny country. Geographically, it's a city state. Local ecommerce is not viable because international is cheaper, faster & has extra advantages.
> Local ecommerce is not viable because international is cheaper, faster & has extra advantages.
I disagree, some companies in my own country try to claim the same, but when I look at the market, there are a lot of players, a lot of profit being made, it can be done.
In a sense I have a suspicion that this is just some companies gotten lazy and not realising multitude of thing e-commerce provides. People want warranty, a nice fast mobile app in their native language, fast shipping, to support local companies - there's quite a lot a local company could offer. But a customer doesn't want to pay 10x as much and get quarter of that, that should be very clear.
But, at least in that country, you cannot use the postal service or major delivery services to deliver packages locally for a similar cost and delivery price as internationals... With amazon being the recent, and blatant culprit.
They deal they did with the postal service are not a secret. Neither are delivery times.
Monopolies, and the effect they have on the economy are not newtonian physics. It's not deterministic. Economic structures create prevailing winds, not airtight control over outcomes.
Postal services are a structure. The structure creates a prevailing wind that heavily biases an outcome.
Nationstates have no meaning beyond mechanism to obscure borderization of humans and boderlessness velocity of capital. It would be more correct for me to say I am a Bezosian or I am a Zuckerbergian than I am Canadian.
Back when I first heard about this, I read up on it: it seemed to me that it was quite time to move China off the list of "extra cheap shippers". I know it'll have a number of knock on effects over the next few years, and I'm not sure what those will be for the average American.
It'll be nice , in theory, to be able to set up a widget shop in the US and sell to China at the same parcel rates that my counterpart in China could, to the US.
The "unfair advantage" is not one sided and otherwise considered developmental aid for developing countries (as developing countries, rising them out of poverty, seems to be the best overall strategy for humans). The classification of china as developmental country is complicated, but you can't just look a Beijing skyscrapers and go "yeah we're done here." (Or you can, but that's not very helpful, one option would be GDP/c https://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28PP..., although, thanks to the huge population, the gdp overall is quite high) also it depends on the time of evaluation.
Until recently the US was on the winning side of the deal, too (according to wikipedia: https://en.wikipedia.org/wiki/Universal_Postal_Union#Shiftin... ) they even blocked an increase of dues in 2010. Until they started to lose money in 2015. Now it's unfair and a decades old treaty (even though it is adapted all the time and serves valuable reasons).
A bit off topic, but does the US have import tariffs or customs duties for items purchased abroad?
In the EU for most items over €20 purchased outside the EU, you will need to pay customs duty and VAT, and possibly a processing fee. The rates depend on what exactly the item is, but can be quite substantial. I bought an action camera from a site like GearBest (I can't remember exactly which one) a few years ago for ~€60, and when it arrived I needed to pay another €50 in fees.
If it wasn't for this I would buy a lot more swag - as most companies will ship from the US, it means a $25 t-shirt would end up costing me closer to $50.
The important things is that the US doesn't have VAT, which makes up the majority of the cost. The de minimis value for import duty is much higher, and the rate is much lower.
Do you have some source for the lower import duty rates?
They heavily depend on the specific item category - in my experience usually 0% or ~5% for the tech items I've imported (but that is not really enough to draw any conclusions from). The de minimis for import duty in EU is 150€ (compared to $800 in US).
Edit: here is the Finnish Customs duty calculator: https://tulli.fi/en/customs-duty-calculator?current=goods&cu... (VAT is Finland-specific, duties are the same EU-wide). A quick look shows that e.g. phones, computer components, and DVDs are 0%, which probably accounts for most of my €150+ imports and thus explains my experience above...
That's the kind of level I was thinking. Compared with VAT levels of around 20% in most EU countries, with a de minimis level of around €15, I'd call that a low rate and high de minimis level.
Edit: it seems there's no de minimis threshold for VAT anymore, so that's even more of a contrast
I thought you meant that USA import duties are much lower than EU import duties, but I now see you meant EU import duties are much lower than EU VAT taxes.
Completely agree then.
The removal of the €22 low-value exception for VAT will happen in EU on July 1st 2021, so not in effect yet.
Yes, but only on purchases over $800 for the vast majority of individual consumers. For over $800, like most countries the way tariffs and duties are calculated is a little complicated, but broadly if the goods are not produced in the US at all there is little to no charge. Clothing, shoes, and some items that have political issues like foreign steel have duties around 25%
Even if there are import tariffs/duties what matters is whether they're enforced. Unlike my friends in Canada (just one example) I've never actually had any fees levied on a shipment I received from overseas. So even if the average American taxpayer technically owes fees those fees probably never get collected unless they're on big purchases.
"For many years, sellers in China have been able to ship for less from China to America than local American sellers can domestically, thanks to something called ePacket."
This system was undoubtedly maintained so that US business could get cheap labor rates in China. Sending mail from China should be more expensive than domestically if the cost is based on distance. However, that would be a barrier to trade. US business spent the 90s trying to outsource manufacturing to China and a barrier to trade would foil that plan to exploit cheap labor overseas and avoid unionization domestically.
Clearly the US national business community must feel threatened by China's changing policies or by a change in their negotiating position or this wouldn't be going through.
This is old news. I'm not a fan of Trump, but his gambit on withdrawing from the UN Postal Union is one of the few good things that came from his administration.
Looking at all the flagged child posts, seems you have invoked the wrath of the "orange man bad" patrol. Very sad state of affairs for critical discourse in this country.
Misnaming a virus for racist reasons is an achievement? How about focusing more on testing and not allowing hundreds of thousands of Americans to die instead. Or maybe just wearing a freakin mask and not making that a political issue and leading to tens of thousands of unnecessary American deaths.
The trade war has led to very few, if any, companies move to China. The only major change is that China buys a lot less agricultural products from the US requiring the administration to straight up pay tens of billions to Midwest farmers so Trump wouldn’t lose their vote entirely.
Not sure what talking to the Taiwanese President has to do with anything when Taiwan is more afraid of China right now than it has ever been because he won’t publicly agree to protect it.
Yeah, the largest arms sale is still minuscule and is gonna do nothing to stop China from taking over Taiwan militarily if they wanted.
And China has taken over Hong Kong almost entirely and there hasn’t been a peep from the US govt. Instead, the Trump administrations response was to punish Hong Kong and start treating it as if it is already a part of China and the 2 systems 1 nation rule doesn’t apply anymore.
Nice. He had 1 person arrested by the Canadians. That’s brilliant.
China Mobile would have been blocked by any administration. Because the US government used to be run by competents, who didn’t crow about every minuscule move they made, because they were focusing on massive changes that would actually have teeth (such as the TPP) you are likely not even aware of the fact that Obama’s administration blocked a bunch of Chinese private actions. And they were actually successful and did not require breaking international law therefore making US allies also suspicious of the US.
Your opinions aside, the current administration has been the first in decades to stand up to China both in philosophy and in policy. You can't say the same about Clinton, Bush, Obama et al who actually empowered the Chinese by letting them off easy on the Tiananmen Square Massacre, allowing them to join the WTO, and militarize the South China Seas, among other things.
Why aren't they asking the recipients pay for the loss ?Obviously people are so gung-ho for buying cheap chinese crap from ali-express or wish, they can pay the additional couple of bucks to hav etheir packages delivered to them or send them back to china.
That sounds like a bigger loss of money - having the postman collect a couple dollars for every package would be labor intensive and result in multiple delivery attempts, and if the recipient didn't pay, then they'd have to return the package to the shipper, so the package would have 2 trips through the system.
Collecting more money from the sender sounds like the better solution.
And government makes boatload of cash by changing tariffs, port clearance, and tons of other fees etc... If you remove all of them, we can get wayy cheaper price than what we get.
It's a very reasonable question, and the answer is the USPS should not do this.
The Postal Union predates the UN by at least 50 years, the notion that each nation would honour each other's mail predates commerce as we understand it and doesn't make sense.
This program should have been abolished decades ago.
> the notion that each nation would honour each other's mail predates commerce as we understand it and doesn't make sense
Is this that much different from net neutrality, phone call routing, email routing, etc? Should an ISP have to carry data belonging to other services? Should a mobile operator just refuse to route calls coming from another operator or country? Should Google refuse emails from another email provider or country?
I pay to get my mail delivered to a foreign country and both source and destination postal systems get a cut. Honoring the deliveries works in the favor of all sides. If the implementation is bad fix that, don't drop the system.
I see what you're saying but it's not quite the analogy you're looking for in Net Neutrality.
In shipping, they have to charge you a different rate for packages than they do mail (i.e weight) or else it won't work.
With data, it'd be nary impossible to clear prices for such services. With mail, it's entirely possible.
There is basically no reason that China Post can't charge their customers a rate to get something to the US, and then another rate by the US Post to get to final destination.
Because shipping involves real labour and money, it's like any other service, it should be priced normally.
If the postal union was not borne 150 years ago with this odd kind of arrangement, nobody would suggest it today. It needs to go.
The title could probably be improved to reflect that changes to rates begin in three days:
> On September 25, 2019, the United States and United Nations reached a deal for America to stay in the UPU in return for being allowed greater flexibility in setting prices. In other words, the U.S. can now set rates for mail from China and other countries. The U.S. will be allowed to set its own postal rates starting on July 2020 and other countries will be allowed to starting in 2021. There will be a five-year period of phasing in new rates.
> The maximum annual increases for all countries cumulatively from 2020 to 2025 will be between 119%-164% (with China being on the upper end). This works out to annual increases of 15% in 2021 and 2022, 16% in 2023 and 2024, and 17% in 2025.
This is probably the one meaningful, positive thing that Trump accomplished[0]. It's ridiculous that shipping from the other side of the world is cheaper than shipping locally. The one thing I disagree about, is that it currently only fixes the problem for the US, and the EU has to wait (another half year, I think?) before they can fix their prices.
[0] Blocking TPP is another candidate, although I think I'd rather see it fixed than blocked completely. I suspect Trump might actually have agreed with the original TPP, had he known what it was about.
Blocking TPP was a disaster. TPP would have achieved everything the Trump administration has failed to achieve with China and has spent tens of billions of dollars doing so in direct costs (the indirect costs are even higher and will last for decades).
The major complaint about TPP was the IP protections. But the hypocrisy is that the lack of the IP protections is exactly the same people complain about China.
There was absolutely no reason to block TPP, which in a nutshell, gave Chinese neighbors the opportunity to do business that the US was doing in China currently, and in return agree to implement an IP protection environment that everyone agrees China should have but doesn’t.
Besides providing American (and non American) companies with multiple alternatives to China where their IP would not be stolen, it would have built massive American soft power with Chinese neighbors at absolutely no cost to Americans, since the business going to those countries was business being done in China anyways.
TPP also included corporate courts that could force a country to reimburse foreign companies for losses due to changes in democratic laws. That is the big part that many people on HN and elsewhere objected to.
But yes, TPP also had its upsides, which is why I prefer a fixed version rather than blocking it completely. The US, by the way, was the biggest proponent of those corporate courts. Sadly the Trump administration lacks the know-how or desire to negotiate that sort of nuance. So while I agree with blocking it in the form it had at the time, I disagree with blocking it completely, which is of course what Trump did.
Rates are determined by the United Nations Universal Postal Union. The US was threatening to withdraw over this last year, but settled on the ability to raise rates on China starting next month. [1] This is covered in the article, too.
It’s amazing how we had to threaten the UN to get them to end this OBVIOUSLY uncompetitive practice. Why should US company tax dollars go to subsidize the cost of a foreign competitor? And we’re not talking about helping our a 3rd world country here, we’re taking about our largest rival for world power.
The UN being unwilling to separate China from the rest of the lot until being threatened says enough.
No, this was by design. The US and Europe wanted to encourage trade by developing countries, so built in cheaper rates for them. This also still makes sense for Rwanda or Nepal, less so for China which simply developed at an unexpected speed and scale. Obviously a mistake not to build any kind of automatic adjustment in...
No, it was not 'designed' to fund Chinese competition and outsource massive numbers of manufacturing jobs over there. This was a side-effect of the program gone obviously and terribly awry.
The original program is ancient and really was a matter of national courtesy in delivering other nation's international mail.
EDIT, FYI:
"The Treaty of Bern was signed on October 9, 1874, establishing what was then known as the General Postal Union.
The treaty provided that:
There should be a uniform flat rate to mail a letter anywhere in the world
Postal authorities should give equal treatment to foreign and domestic mail
Each country should retain all money it has collected for international postage."
The current practice of giving China free postage was established 150 years ago, not in some modern trade strategy, and it was a means of simplifying postage and not having to worry about balancing accounts (i.e. host nation keeps the fee). This kind of economic reciprocity is basically unheard of in anything else, but it makes sense for a strategic industry that's not necessarily very expensive.
For shipping goods, obviously, it makes no sense.
I challenge anyone to explain how an agreement made in 1874 for critical international communications, that has unexpectedly given China a massive trade advantage in developing industries, was part of any plan. The argument that the terms may have been advanced due to helping places like Africa with trade just don't hold in the current context. The US government subsidisation of Chinese e-commerce doesn't really make any sense.
You are ignoring that the Union was established 150 years ago, but the agreement is changing over time. And like every other country, the US is trying to modify it in a way it sees profitable for themselves at the time.
According to your wikipedia article in 2010 the US blocked increases because they were on the winning end of the treaty. But as unforseen changes actually made them lose money on the deal, it was suddenly unfair and out of date.
The principle that 'nations pay for local delivery for free' as a matter of convenience, was established 150 years ago.
That basic principle remains today.
If that agreement were not made an eternity ago, nobody would even think to suggest it today - because it doesn't make sense.
You are missing the point when you're referring to 'making or losing money' on the deal. It's not so much about the cost of regular shipping - it's about the subsidisation of entire competitive industries.
The rise of e-Commerce has changed everything related to shipping, quite fundamentally.
A US subsidy on their own imports to China, even a smaller one, can make quite a substantial change in commercial trends.
The treaty was not designed to do that, nobody was thinking in those terms, at that scale.
Not even 25 years ago did we think individuals were going to be buying little parcels from China on an individual basis.
The treaty now has to live in the context of e-Commerce and it should essentially be abolished for packages, because it simply does not make sense. In an era before computers, it might have made sense to honour each others letters. But now there's no reason why the sender just can't pay appropriate rates for shipping.
Edit: I should add - there isn't a single argument presented by anyone on the entire thread as to why one nation would arbitrarily deliver another nations physical packages 'for free' or on reciprocal basis. This is because there is no reason to support it in 2020. It exists for historical reasons, bureaucratic and political momentum.
Exactly. First-class letter mail used to dominate the postal system, and it tends to have about equal traffic in each direction. So the UPU wasn't that concerned about settlements. Until 1969, there weren't any settlements; countries "peered" at no charge, like the Internet. Then came "terminal dues", the charges the delivering postal system charges the originating postal system.[1]
Also, there's a price break for "underdeveloped countries", and 20 years ago, at the last round of rate setting, China qualified.
Despite all the noise from the Trump administration back in 2018, 2020 was the next scheduled year for updating terminal dues. Here we are in 2020, and there's a new terminal dues agreement, as scheduled.
I've bought a bunch of small trinkets from Aliexpress. For the most part, they're the same exact things you can buy off of Amazon for ~$5-15, except they take 2ish months to be delivered. For some things, it actually does make sense to just wait that long (e.g. a Google Home Mini wall mount) in exchange for the savings (>= 50% is normal).