I like the fact that the NYT splashed Steven Greenhouse’s article on the Post Office’s woes all over its front page yesterday. There’s not much new here, but it’s a huge and important story and the public is far too ignorant of it.
“The causes of the crisis are well known,” writes Greenhouse, “and immensely difficult to overcome.” This is true. And the big one — the secular shift from snail mail to email — is not something that Congress can do anything about. But just look at how Congress is tying the Post Office’s hands behind its back here — and not just by forcing it to pay $5.5 billion per year into a retiree healthcare fund.
The law also prevents the post office from raising postage fees faster than inflation…
In some countries, post offices double as banks or sell insurance or cellphones. In the United States, the postal service is barred from entering many areas…
The postal service is also asking Congress for permission to end Saturday delivery.
It seems to me that a significant part of the problem here lies with Congress and that a massive bout of deregulation could be just the solution that the Post Office is looking for. Congress is micromanaging the Post Office, telling it how much it can raise postage rates, telling it that it can’t offer financial services (despite its huge business in money orders), telling it that it can’t get into all manner of other businesses either and telling it that it has to deliver mail on Saturdays. Astonishingly, amid all these rules and regulations, the Post Office is losing billions of dollars.
I see a lot of scope for bipartisan agreement here — unshackle the Post Office so that it has a hope of serving the country indefinitely into the future. Republicans like deregulation, right?
The problem, I think, is that for all that Republicans like deregulation, they really hate the idea of a state-owned organization competing with the private sector. Of course, the Post Office does that already — it competes with FedEx and UPS. But the USPS, as a government-subsidized organization with thousands of locations nationwide and a massive reserve of public trust, could be a formidable competitor in all manner of different markets and none of the incumbents in those markets would welcome the competition.
Over the long term, however, I suspect that the only way to save the Post Office will be to allow it to move into financial services. There’s a lot of expertise in the rest of the world when it comes to the questions of how to set up and run a post bank. Meanwhile, banks in the U.S. are mistrusted and disliked and many people would love to be able to just bank at the Post Office instead.
It might be too late now to set up a post bank — but I doubt it. (This is still a country, after all, where most people still use paper checks.) There’s a window of opportunity here. Let’s grab it, before it’s too late.
The post office, operating under many names over the history of the United States, was operated under government-subsidized, government-owned management until October 1, 1982. At that time, the organization became an entity completely seperate from the United States Government, yet controlled by Congress. Since its inception on October 1, 1982 the United States Postal Service hasn’t cost one cent of tax money or federal money or any other money, other than the proceeds gained through the sale of postage and delivery services.
Also in 1982, the Postal Service (through the approval of the Office of Personnel Management) began hiring new employees under the Federal Employees Retirement System (FERS), which drastically reduced pay and retirement benefits for its employees. The FERS retirement system is, essentially, a 401-K program for employees by any other name. Also in 1982, the health insurance benefits which had been offered to Civil Service postal workers were discontinued for new employees of USPS.
I understand that some in the public believe working for USPS brings with it enormous pay and health benefits with a massive, federal retirement. None of this is true. (This is not a criticism, please read on).
I began employment with USPS in the summer of 2001, and I can tell you that the pay and benefits are less than the pay and benefits I received for factory work while I was in college. (Again, not a criticism… please read on).
I make these points NOT to complain… I can honestly say that being a letter carrier is the most physically demanding, mind-racking work I have ever done in my life; AND I LOVE IT.
I say all this to point out that USPS, as far back as 1982, was planning diligently and working hard to be the most efficient, fastest, least-expensive postal entity in the world, truly “delivering” first class service. That legacy continues today. The United States Postal Service DOES operate as a business complete with financial reports, fiscal year budgets, retail business models and a significant customer focus. Believe me, if there are no sales of postage, there is no bailout or “gimme” program. The fuel which operates my CRV delivery vehicle is paid for with money from postage, as is everything else within USPS.
However, none of these efforts will matter at the end of the day if Congress does not allow USPS to function –completely– as a business. Universal service at competitive rates, six days a week, is possible. Believe me. But as long as Congress is holding the reigns as they now do, the Postal Service is on track to self-destruct under the weight of its own mandates.
It’s a lot like telling your dog to run faster, while you hold him in place with a leash. If our society wants this dog to run, Congress simply must make changes. They must stop using USPS as a cash cow (mail and package delivery is a huge business, folks) only to drain the coffers on September 30th of each year.
End the health care pre-funding mandate. Remove the mandate that USPS cannot make a profit. Allow the Service to enter into non-postal operations (such as banking and meter-reading services). -And watch that doggy run, and run, and run.