My colleague Charlotte Hays recently wrote that government stimulus money was used to prop up two MSNBC shows hosted by Keith Olbermann and Rachel Maddow. The Mercatus Center’s Matthew Mitchell details how government largesse with other people’s money isn’t limited to politicians’ favorite TV shows or green companies. Apparently, government believes that generosity, like charity, begins with itself.

In his recent analysis, aptly titled The Pathology of Privilege, Matthews singles out the U.S. Post Office as a prime example of taxpayer-funded protectionism:

The financial bailouts of 2008 were but one example in a long list of privileges that governments occasionally bestow upon particular firms or particular industries. At various times and places, these privileges have included (among other things) monopoly status, favorable regulations, subsidies, bailouts, loan guarantees, targeted tax breaks, protection from foreign competition, and noncompetitive contracts. Whatever its guise, government-granted privilege is an extraordinarily destructive force. It misdirects resources, impedes genuine economic progress, breeds corruption, and undermines the legitimacy of both the government and the private sector. …

The United States Postal Service is a case in point. While the U.S. Constitution grants Congress “the power to establish post offices and post roads,” it does not, like the Articles of Confederation before it, grant Congress the “sole and exclusive right” to provide these services. By the 1840s, a number of private firms had begun to challenge the postal service monopoly. Up and down the East Coast, these carriers offered faster service and safer delivery at lower cost. While the competition forced the postal service to lower its rates, it also encouraged the postal service to harass its private competitors: within a few years, government legal challenges and fines had driven the private carriers out of business. More than a century later, in 1971, the postal service was finally converted into a semi-independent agency called the United States Postal Service (USPS). Its monopoly privileges, however, remain. No other carriers are allowed to deliver nonurgent letters and no other carriers are allowed to use the inside of your mailbox. …

For all that protectionism, the USPS remains in financial shambles—costing taxpayers even more.