Video: UPS vs FedEx
posted at 2:55 pm on November 10, 2009 by Ed Morrissey
So far, the only major commentary from the Right on the legislative war between UPS and FedEx has been linked to the American Conservative Union’s attempts to woo business from FedEx, in part by offering for sale opinion columns by the ACU’s board members (see here for the ACU response). Reason TV’s Nick Gillespie takes us inside the real issues of the battle between the delivery giants, satirizing the current UPS “whiteboard” ad campaign, and exposing the real villain of the issue — which is neither UPS nor FedEx. Instead, just as with most of the economic messes of the last few years, we have the federal government meddling in the marketplace once again:
How did UPS and FedEx, who obviously compete in the same market, get classified under different federal rules? That’s less interesting than the current attempts by UPS and the Teamsters to reclassify FedEx under the harsher rules, rather than UPS fighting to get classified under the lighter regulation FedEx enjoys now. Why would UPS pursue that direction? They’re stuck with the union contracts they already have. Reclassification wouldn’t save them a red cent, at least not for the foreseeable future. The only way to compete on labor costs is to sic Big Government — and the unions — on FedEx, not a particularly noble effort.
This is what happens when governments intervene in private markets. They create artificial disparities that usually handicaps one producer in relation to another. Often that is done deliberately, but it also happens accidentally often enough that one can’t correct for malice. In this case, the UPS effort to “correct” the problem would inevitably raise prices for consumers, which consumers should realize before Congress takes the opportunity they rarely miss to make a bad situation worse.
Update: Don’t miss Veronique de Rugy’s Reason Magazine piece, “Using Unions as Weapons.”