USPS holds a monopoly over which type of mail service?

The correct answer is that USPS holds a monopoly over First Class Mail. This monopoly is rooted in the Universal Service Obligation that mandates the USPS to provide consistent mail service to all Americans, regardless of location, at uniform rates. First Class Mail is the primary and most widely used service for personal and business correspondence, including letters, postcards, and bills.

The distinction of First Class Mail is significant because it is the only category of mail for which the USPS has exclusive legal rights to deliver. Thus, no other carrier is permitted to compete in this space for standard letters, ensuring a reliable and universal service for essential communication.

On the other hand, Express Mail and Priority Mail are services that, while provided by USPS, do not fall under the monopoly protection. They are subject to competition from private carriers, such as FedEx and UPS. Parcel Select as well also allows for competitive options in delivery, distinguishing it from the monopoly status of First Class Mail. This ensures USPS maintains its unique role and obligation in providing essential mail services throughout the nation.