In recent years, January has brought Americans a celebration of a new year, thrilling National Football League playoff games, and a modest postage rate increase that roughly tracked the rate of inflation.
Everyone was talking about this year’s overtime NFL conference championship games. On January 27, 2019, however, postal customers will be discussing a topic far less pleasant. The Postal Service is raising the price of a one-ounce, stamped, First-Class letter from 50 cents to 55 cents.
A five-cent increase in the price of a Forever stamp will be the largest increase in history for the one postage price that most Americans pay. As a percentage, the 10-percent increase is the largest since 1991, and it is about four times the average increase since 2006. (A history of domestic letter rates is here.)
The Postal Service is making other changes in First-Class Mail as well. The additional-ounce price for letters and large envelopes will drop from 21 cents to 15 cents. The Postal Service says that this decline in the additional-ounce price will help mitigate the effect of the big price increase on the first ounce. Meanwhile, the one-ounce price for metered letters will increase from 47 cents to 50 cents, prices for presorted letters will increase by only 0.97 percent, and the price for postcards will remain 35 cents.
So why is the Postal Service increasing the Forever stamp price by five cents? And how can the Postal Service increase so dramatically the price that the general public and small businesses pay while increasing prices for large mailers by less than inflation?