Interview with Nick Zaiac, R Street Institute

Ahead of the World Mail & Express Americas (WMX Americas) Conference in Miami, we caught up with Nick Zaiac, Fellow in Commercial Freedom at the R Street Institute. Nick will be speaking at WMX Americas 2019 and offers his thoughts on the conference and the future of the industry.

P&P – Tell us a little bit about yourself and your company.

NZ – I’m Nick Zaiac. I’m a fellow in Commercial Freedom at the R Street Institute in Washington, DC. R Street is a think tank dedicated to providing free market solutions to a range of high-complexity policy issues including postal regulation. At R Street, my research focuses on postal, logistics, infrastructure, and land use regulation. I hold an MA in Economics from George Mason University.

P&P – What will you be speaking about at WMX Americas this year?

NZ – I’ll be speaking on the state of federal postal regulation in the United States. This presentation will lay out the plans put forward by Congress and the administration for changes to postal business practices. The conversation will seek to consider the trade-offs inherent in these proposals and highlight some of the most promising paths to updating the postal business model.

P&P – What do you hope our delegates will take away from your presentation?

NZ – I hope delegates will walk away with a better understanding of the state of American postal policy today. The changes to come will not necessarily be as dramatic as the PAEA, and the goal is for delegates to understand the value in piecemeal change to the postal regulatory structure.

P&P – What do you feel are the biggest challenges facing your business today?

NZ – The urgency of postal reform increases each year that existing regulatory problems go unaddressed. The rigidity of existing postal law prevents USPS from adopting the best practices of other national carriers. The agency’s ultimate regulator, Congress, has been slow to address even broadly-appealing postal reforms to address topics like pensions, procurement compliance, and shipment of illegal drugs through the mail. This adds up to a business that’s slow to adapt because of its regulatory structure.

P&P – How can we advance the post and parcel industry?

NZ – The way we advance the post and parcel industry is realizing what types of infrastructure keeps the post and parcel industry moving and companies being willing to invest in the infrastructure they use. Advancing the post and parcel industry might mean paying for better pavement on roads near distribution centers, or offering to pay cities to add loading zones where they’re needed.

P&P – How has the post and parcel industry changed in the past 5 years? What do you predict will happen in the next 5 to 10 years?

NZ – The remarkable thing about the last 5 years in postal policy isn’t what’s changed, rather, it’s that the fundamentals have stayed the same. A downward trend in mail and upward trend in parcels, and stagnant worker productivity remain. Regulators have yet to do anything that would change the trends, but that won’t last forever. In the next 5 to 10 years, as the status quo USPS financial woes persist we can expect Congress to act in some way. We could see USPS franchise the mailbox on a local or regional scale, opening an entirely new post and parcel industry. There will be changes to labor practices in some form, likely making postal workers in America more like their civil servant peers.

P&P – What is the biggest challenge in the post and parcel industry at the moment?

NZ – Right now the biggest challenge in post and parcel policy is the lack of legislative urgency in addressing a quickly-deteriorating USPS financial situation. Many ideas have been thrown around. There were multiple postal bills in Congress in 2018, and 3 different plans from the Trump administration. But nothing has changed, and USPS mail volumes continue decline, retiree healthcare remains unfunded, and a mess of legislation keeps the agency from adapting to a changing postal business. Much of this can only change if Congress acts, and Congress hasn’t acted on substantial postal reforms in a decade.

P&P – What are the most critical changes that we must make to face the future effectively?

NZ – The most critical change will probably be acknowledging that traffic is a preventable problem that saps the reliability of delivery in any urban environment. This might mean supporting policies that cost companies money in the short run, such as congestion-priced vehicle miles travelled taxes, that unclog roads and make deliveries more reliable in the long run.

Nick will be speaking at the World Mail & Express Americas Conference 2019. WMX Americas is taking place at the Miami Marriott Biscayne Bay (10 – 12 February 2019). Visit www.wmxamericas.com for more information.