FTC Chairman Calls for End of Mail Monopoly

James C. Miller III, President Reagan’s nominee to succeed David A. Stockman as U.S. budget director, says the Postal Service’s monopoly on first-class mail should be abolished and private enterprise allowed to deliver letters.

“Few seem willing to consider the one action likely to have a real effect on the efficiency of the U.S. postal system: Let others compete in the delivery of first-class mail,” Miller, now head of the Federal Trade Commission, wrote in an article in the current issue of the Cato Journal.

The Journal is published by the Cato Institute, a Washington-based research organization that describes itself as libertarian, or “free market-oriented.”

Miller wrote the article earlier in the year, before he was designated to head the Office of Management and Budget.

Judith Pond, an FTC spokeswoman, said the article merely restated views that Miller has held for some time. Miller has been a forceful advocate for reducing government regulation, both in his leadership of the FTC and as executive director of a task force on regulatory relief headed by Vice President George Bush.

‘Watchdog’ Official Disturbed

Shannon Ferguson, an official of OMB Watch, a private “watchdog” organization that follows OMB issues, said Miller’s comments on the Postal Service are disturbing. He said ending the Postal Service’s 140-year monopoly on first-class mail could have as far-reaching consequences as the decision several years ago to break up American Telephone & Telegraph Co.

“People in the rural areas and the inner-city areas would get the shaft. Private companies would get the best routes,” Ferguson said.

Miller claimed that private companies have done a good job in competing for the delivery of parcels and overnight express mail--not covered under the congressionally awarded monopoly, which applies only to letters.

“All the available evidence suggests that competition in the market for first-class letter delivery would create substantial benefits, “ he said.

The Postal Service said it did not wish to comment on Miller’s article.