Government

Those 'Forever' Stamps May Be A Good Investment, After All

Kevin Pownall

Paying to get this stuff delivered could get pricier. Matt Rourke/AP hide caption

itoggle caption Matt Rourke/AP

Next January, postage stamps could cost 46 cents, if the United States Postal Service wins approval of a proposal it made yesterday. That's a 4.5 percent increase over today's price of 44 cents, which went into effect in May last year.

Philatelists might take offense. After all, just four years ago President George W. Bush signed a law that said stamp prices wouldn't rise faster than inflation.

Last year, prices in the overall economy decreased; this year, they're rising slightly, but not nearly in line with a 4.5% increase.

So what's up? It turns out there's a loophole in that law.

The Postal Service can ask for an increase under "extraordinary and exceptional circumstances." Postmaster General John Potter suggests the postal service is facing those circumstances today, citing "plummeting mail volume" and "a dire financial situation."

Big postal services customers disagree. Joe Schick, director of postal services at a printing company called Quad/Graphics, argues the loophole "was never meant to be used for an economic event."

He told me he thinks the postal service should reserve it for a "catastrophe like an anthrax event or (Hurricane) Katrina." He says his business will be hit hard by the proposed increases, which also include hikes for periodicals.

A postal service spokesman didn't immediately respond to requests for comment.

There's a silver lining in the rate increase when it comes to forever stamps, which can be used no matter how many rate increases occur after a customer buys them.

They have proven extremely popular with consumers, even though when stamp prices rise at a lower rate than inflation, they are a bad long-term investment.

(Yeah, yeah, we know people buy them for convenience, not as an investment. But play along with us here.)

If the rate increase is approved in such a sluggish economy, stocking up on forever stamps will pay off. And the postal service is launching a new batch of evergeen-themed forever stamps, just in time for the holidays.

Update: A postal service spokesman confirmed that this is in fact an "exigent" increase that would exceed the consumer price index. He directed us to this testimony from a postal service exec, arguing for the increase.

And, in response to our final question, his answer was yes: This is the first time that holiday-themed "forever" stamps have been issued.

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