How can Chinese sellers ship me a product to my house that only cost $1 and includes shipping?
The Chinese government subsidizes the shipping. Basically China struck a deal with the USPS that gave them the option to buy the remnant space on planes and containers heading for the US at a bulk rate.Since those planes and boats were going back and forth every day anyway, and the mail routes bringing the mail to people's houses happen every day anyway, the US government saw it as a way to bring in some extra revenue without increasing expenses. Unfortunately, they had no idea how wrong they were…When a factory ships to a US consumer via ePacket, they are paying nothing for the shipment. The Chinese government pays for it via their negotiated rate. That's why delivery dates aren't guaranteed - it ships when there's space available.While that all sounded good on paper, like most Government ventures someone didn't think through the impact, real cost, and the changes in behavior that would result from it. Unfortunately, the move has had a major negative impact to both the US economy and to the Post Office - while putting an exact dollar amount on it is hard to quantify, I personally consider it one of the largest economic failures of the last administration.Once it became less expensive to ship goods from China than it was to ship them across town, Chinese direct to consumer commerce increased - eBay and Amazon listings for lower cost goods and lower shipping costs direct from China pushed US sellers out of the market, and more eCommerce sites with goods drop shipped from China started popping up.All of that became revenue that American companies no longer got, revenue the US Government didn't get to tax, and revenue the Post Office doesn't receive that they would have received on a domestic shipment.In its first year (2021), more than 27 million packages were shipped from China this way, which resulted in a nearly $75 million loss for the Post Office. The Post Office now loses an estimated $1.10 per package. The losses come both from not properly accounting for all costs of the deal, a drop in revenue due to Chinese shippers that used to pay full price migrating to ePacket instead, and loss of domestic shipping revenue due to goods being purchased from China instead of here.An unknown number of private sector jobs have also been lost as a result, due to what I consider unfair competition resulting in corporate losses.For example, we might spend millions of dollars engineering a product and putting it on TV, with the ultimate goal being to drive that product to retail. Yet, before we are anywhere near that point, Chinese lower priced counterfeits are immediately available on Amazon, Alibaba, and other sites, where foreign sellers capitalize on the demand we are generating. That results in fewer sales for us, lower revenues, and more complaints about the product - since many consumers don't know they bought a knock off, when the counterfeit ends up being junk, they write negative reviews about the product and drive legitimate sales down further. And even for the ones that aren't blatant IP infringement (just very similar), there's no way to compete on price with a country that purposely devalues its own currency to widen the price gap, produces it cheaper, and delivers it for free.All because some government stooge thought they could make a few extra bucks.This “partnership” needs to go, and soon.