This discount is what got brought up when I complain about this on NextDoor and Facebook. Local business owners who are contributing to the spam, whose circulars are among those I just immediately throw in the trash, don't want to pay more. I'm very curious if they actually track the ROI on that advertising. I've asked - one local business found they got nothing from mailings anyway. But that's just a sample size of 1.
No, this won't eliminate it. It will give you less of it, though, and give the USPS more money. Win/win, even if we don't win as much as we would like.
Bulk mail currently gets a discount compared to individual letters. Eliminate that, and we'd see less bulk mail.