During a recent digital session at a Morgan Stanley technology conference, Elon Musk, an influential adviser to former President Donald Trump and the CEO of Tesla and SpaceX, shared his perspective on the privatization of specific U.S. government services. Musk specifically mentioned Amtrak and the U.S. Postal Service (USPS) as prime candidates for this transition.

Concerns About U.S. Railway Services

Musk expressed dismay at the state of the American rail system, stating, “Amtrak is a sad situation,” particularly in comparison to the more advanced high-speed rail services he has experienced in other countries. He strongly advised foreign visitors to avoid using Amtrak, emphasizing that it could lead to a negative impression of the United States.

Musk’s Privatization Argument

Musk’s call for privatization stems from his belief that such a strategy would foster competition and create a “feedback loop for improvement.” He elaborated, “Basically, something’s got to have some chance of going bankrupt, or there’s not a good feedback loop for improvement.” His straightforward stance is that the U.S. government should aim to privatize as many services as possible.

Background on USPS and Privatization Discussions

The discourse surrounding the privatization of USPS has been ongoing, especially since Trump indicated interest in exploring the idea at a press conference. He referred to privatization as “not the worst idea I’ve ever heard,” acknowledging continual financial issues faced by the Postal Service, which often releases annual reports of losses mainly due to retiree pension costs. In the most recent fiscal year, USPS reported an operating revenue increase to $79.54 billion, despite a decline in mail volume.

The Role of Postal Service in America

Critics of the privatization initiative highlight the essential service USPS provides, particularly in rural and underserved areas, where private shipping companies may not operate. The USPS is bound by a universal service obligation, meaning it must deliver mail and parcels regardless of distance or profitability concerns.