The subtext to this one is, ” . . . because so many (or most) Americans were illiterate back then.” For that, scroll way back down to Myth #37 about shop signs. And thanks to Noah Briggs who adds, “This myth proceeds on the bizarre assumption that the American literacy rate was worse “back then” than it is today. In reality, the US had a very good literacy rate, as demonstrated in this article here. http://www.raggedsoldier.com/literacy.htm” That links to an interesting study of literacy during the Civil War era.
For the main portion of this myth, my thanks go to Carolyn Murphy who delivered the coup de grace. “In order to get the ultimate answer about color-coded post offices, I checked with the Jennifer M. Lynch, Postal Historian at US Post Service Headquarters, Washington, DC. She said: ‘I have never heard of color-coded government buildings. In the 1800s, most buildings that housed Post Offices were owned by the postmaster–not the government. There were no regulations regarding exterior paint.’ That seems to answer that question. For any further Postal information, go to http://about.usps.com/who-we-are/postal-history.”