In 2003, the U.S. Postal Service initiated the Intelligent Mail program, which would integrate thirty different barcode systems used by commercial mailers into a single system. Ideally, the new barcode system would improve efficiency, reduce costs, and improve timeliness of delivery. However, a new report from the Government Accountability Office details numerous problems with the program’s implementation that are all-too-common in government:

The U.S. Postal Service reported that it lost $3.8 billion last fiscal year and that it expects to lose $7.8 billion this year. The loss occurred despite cost-cutting measures and legislation that allowed the USPS to forgo $4 billion in required payments to pre-fund retiree health benefits.

The Federal Aviation Administration is trying to implement a $35 billion overhaul of the nation’s air traffic control system that would replace old-fashioned radar technology with modern satellite-based GPS navigation. But according to the Associated Press:

In the face of a projected $7 billion loss this year, Congress recently passed legislation allowing the U.S. Postal Service to forgo $4 billion in required payments to pre-fund retiree health benefits. This temporary band-aid did nothing to address the Postal Service’s struggling business model, which is weighed-down by excessive labor costs.

Another day, another story on financial troubles at the federal government’s mail monopolist.  We don’t expect the government to make our blue jeans, transport fruits and veggies from the farm to the market, build computers and IPods, or manage the manufacturing of automobiles, so why must it continue to deliver first-class mail? 

The New York Times reports that the nation’s only privately financed commercial airport is set to open in Branson, Missouri.

Unlike government transportation projects such as the Big Dig, this private project has gone well so far: “‘I think it’s some kind of record,’ Jeff Bourk, executive director of the airport, said of the speed of the construction. ‘On other projects I’ve been involved in, there’s a lot more red tape.’”

On the broader issue of America’s airports, the Times notes:

Every one of the 552 airports providing commercial air service in the United States receives some kind of federal money, according to the Federal Aviation Administration, and these airports are owned by public entities, municipalities, transportation districts or airport authorities.

In airports, America embraces socialism, while free enterprise has taken hold abroad. Many major cities around the world have privatized their airports in recent decades, as I discuss here.

The growth in private airports faces a number of hurdles in America. One problem is that government airports receive federal, state, and local subsidies, which makes it hard for private companies to compete. Another problem is the tax-deductibility of state/local (”muni”) bonds, which gives government facilities a financing advantage over private projects.

The spirit of 1776 is alive and well in Kauai:

Their livelihood was being threatened, and they were tired of waiting for government help, so business owners and residents on Hawaii’s Kauai island pulled together and completed a $4 million repair job to a state park — for free.

“We can wait around for the state or federal government to make this move, or we can go out and do our part,” Slack said. “Just like everyone’s sitting around waiting for a stimulus check, we were waiting for this but decided we couldn’t wait anymore.”

It’s amazing what a little private initiative and economic incentive can do.  Contrast this story with that of a bridge being built to connect Microsoft campuses in Redmond, WA with federal “stimulus” money.

The IBD has an excellent front page summary of the 1990s roots to the Fannie Mae and Freddie Mac disaster.

One issue IBD touches on is the ineffectiveness of the regulating agency OFHEO. OFHEO gave Fannie and Freddie a clean bill of health just last December.

One reason that having regulatory agencies is worse than having no suchagencies is the false sense of security provided to markets by such apparently off-base seals of approval.

Paul Gigot has an outstanding piece on Fannie Mae and Freddie Mac today in the WSJ. “The abiding lesson here is what happens when you combine private profit with government power.” Exactly.

Here’s what I said about the twin-headed hydra in my 2005 Downsizing the Federal Government: