Does Postal Reform Really Matter to Congress?

As Congress goes into its July 4 recess, we should ask ourselves how much does postal reform really matter to Congress and how much does it really want to keep universal service intact?

Certainly Rep. Darrell Issa must believe he’s furthering the cause when he reintroduced essentially the same bill as last year that never got out of the House.  In those bills,  he called for the creation of a postal financial control board. This would effectively privatize the USPS.

Or is the U.S. Postal Service just a potential money maker that will ultimately benefit just a few people at the top who have no concept the USPS is meant above all to provide a needed public service for all Americans?

One thing seems clear: it’s probably gonna take a long time before we see anything change substantially.

Let’s just look at some history.

In 1995, then-Postmaster General Marvin /Runyon proposed massive reform of the U.S. Postal Service, its rate making structure   and ability to compete in the marketplace with the likes of United Parcel Service, Fedex and others.

It took 11 years to pass such legislation, largely because the eventual law, the Postal Accountability and Enhancement Act of 2006 included concessions to a lot of special interests.

It was a long roads but reform legislation did eventually become law.

The PAEA did do some good. It guaranteed small annual postage rate increases tied to the annual rate of  inflation for all classes of mail. This replaced the haphazard and unpredictable system that existed before. This was generally beneficial for both the public and business

But the PAEA also contained the seeds of the USPS’s destruction.

In order to get votes from some very conservative members of members of Congress, the  law included the provision that the USPS pay at least $5.8 billion each year to pay for the healthcare costs of future retirees well into the future.

Let alone the fact this provision made it into the final law, the fact that someone would even propose such a thing showed a great deal of hostility and malevolence toward and, ultimately, stupidity about the vital importance of the postal service to our nation.

No institution could possibly live up to such draconian terms and the USPS certainly hasn’t been able to do so. By this September, the postal service will have defaulted on an estimated $17.1billion of these payments. as well as reporting a loss of $1.9 billion for the year ended March 31.

In fact, Congress knew this and has let this situation drag on and on leaving the USPS to try and solve the problem itself, so far with minimal success like with its misguided attempt to try and override existing law and cut out Saturday mail delivery a few months ago.

Congress of course, jealous of its power, put the kibosh on this plan.

But the USPS has been gradually reducing its local presence in post offices and distribution facilities in face of lots of public and union opposition

The postal service admits it can only save $20 billion by doing this, a laughable amount in face of its true financial state.

It’s funny that a lot of people in high places say the USPS is way overstaffed and could tolerate a smaller workforce. But at least here in New York City, post offices are very often overcrowded and can’t seem to keep up with customer demand. I’m not sure how much if any of this message gets transmitted upwards.

So what happens now?

Can the Democrats and Republicans truly find a way to hammer out a deal to save the USPS? Do they really want to?

This entry was posted in postal finances, U.S. Postal Service. Bookmark the permalink.

One Response to Does Postal Reform Really Matter to Congress?

  1. Lynn N says:

    While malevolence is a really strong word, one wonders what the motive of Congress could have been in requiring the Post Office to pre-pay retiree medical. No private corporation does so. None of the state agencies do so. It was a set-up from the start, with the Postal Service trying to out-run the piper year after year. So what was the motive? To destroy the USPS? Why? Did the Fed Ex/UPS/etc. lobbyists pay off the Congressmen? Could be.


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