Section 14 of the Canada Post Act confers upon the corporation the "exclusive privilege" of delivering letters in Canada. The only exception is for letters of "an urgent nature," so long as the fee is not less than three times the price of an ordinary stamp. Those caught in the act of delivering underpriced postcards face up to five years in prison: the same penalty, as it happens, as it they had sent a bomb through the post.

Protected from competition by the exclusive privilege, Canada Post has behaved like any monopoly would: by raising prices and cutting back on service. The only difference is that the excess profits in this case have been captured by the corporation's workers, rather than its owners. Yet it is just this exclusive privilege that the Radwanski review of Canada Post proposes to maintain.

Indeed, the report urges the corporation to prosecute offenders with more vigor. Past postage increases -- a 600 per cent rise in the last 25 years -- not having been sufficient, it suggests raising the price of a stamp another 11 per cent, to 50 cents. And just to punish the courier companies that have prospered as a speedier alternative to the post office's glacial service, it would require them to carry a Canada Post stamp on every parcel: in effect, raising the bar to four times the prevailing postage rate.

It is worth examining the reasoning behind this determined attempt to prop up the crumbling postal monopoly. The author is aware that a number of countries are considering allowing competition in letter delivery: the three that have done so to date, Sweden, Finland and Australia, are hardly bastions of free-market zealotry. Yet "the circumstances of all three are so different from Canada's that their experience is not applicable." How? Why? The review does not say.

The meat of the argument is scarcely more filling: a recitation of the same stale cliches the post office trots out whenever its monopoly is questioned. If Canada Post's grip on the mail system were not absolute, the report claims, rural and remote areas "would most likely be deprived of service." Private firms "would concentrate on competing in high-density urban areas," skimming the cream as it were, leaving Canada Post to serve the scarcely- populated hinterland.

This is, of course, nonsense: private couriers can and will deliver a letter to any address in Canada, tomorrow -- so long as the price is right. Rural mail service wouldn't end under competition: it would just cost more.The argument that rural areas would be cut off depends utterly on the assumption that the present system of postage, where the price of a stamp never varies, whether you send a letter across town or across the country, would be maintained. Only under a uniform rate regime, where letters are delivered for much less than cost on rural routes, much more than cost in urban areas, does the "cream-skimming" argument apply.

But why would we want to continue with such a potty system of pricing?

The report has a ready answer. "In a country as far-flung as Canada," it intones, "people should not be financially penalized in their access to a core federal public service solely by virtue of living elsewhere than in large urban centres." The keywords here are "public service." Radwanski would not, I think, insist that the price of a house should be the same in Tuktoyuktuk as it is in Toronto; nor is the price of food, or clothing, or phone calls, or anything else. But to charge more for a public service: that would be discrimination.

The argument, then, is perfectly circular. Why should there be a uniform rate? Because it is a public service. And why should it remain a public service? In order to charge a uniform rate. The uniform rate is the linchpin of the monopoly.

Radwanski dismisses critics of the system as being obsessed with "theoretical economic efficiency." All right: let's look at it in terms of fairness. It sounds fair to charge everyone the same price. But when costs of delivery are taken into account, this means city dwellers are in fact subsidizing the mail for their country cousins. The poorest residents of a large city pay more to send a letter so that the richest folk in the country can pay less. This is fair?

The proper basis of redistribution is from rich to poor, not from city to country. Or if we must subsidize rural mail delivery, it could be done at far less cost by directly subsidizing high-cost routes, rather than by holding the rest of the country hostage to the postal monopoly. Redistribution of income is the job of the government, not the post office.