Sometimes one wonders if Congress has it in for the U.S. Postal Service. However, some missteps taken by the Postal Service are often self-inflicted.
The Postal Service is in an awkward position. It’s an independent agency that gets no tax dollars for its day-to-day operations, but is often identified as a money-wasting government agency. Yet, Congress seems to erect roadblocks each time an effort is made to trim costs.
The Postal Service, which lost $16 billion last year, announced in February it wanted to switch to five-day mail service to save $2 billion annually. It proposed switching to five-day-a-week deliveries beginning in August for everything except packages.
However, the latest stopgap budget adopted by Congress mandates six-day delivery. Congress, an abject failure on fiscal matters, continues to make the agency submissive to its own floundering fiscal whims.
A congressional example: The Postal Accountability and Enhancement Act, adopted in December 2006, requires the Postal Service to annually pay $5.5 billion to pre-fund retiree health benefits for the next 75 years, and do so all before 2017.
Supporters of the law contended the Postal Service would become insolvent, leaving taxpayers stuck for any unfunded liabilities.
Today, they say, “See, it’s losing money. We were right.” They don’t mention that the Postal Service was profitable every year through 2006, when the act became law. It has lost money every year since 2006.
Ordering any business to pre-fund 75 years of health benefits and then complain that it’s losing money is beyond common sense.
A bill in the last Congress, HR 1351, would have repealed the Postal Accountability and Enhancement Act mandate. It had 230 co-sponsors in the House, but died in the Committee on Oversight and Government Reform.
Rural communities, businesses, seniors, veterans and others who depend on consistent and timely delivery of the mail point to the need for continuing six-day delivery.
Saturday delivery remains critical to the Postal Service’s future. In the interest of disclosure, newspapers are a major customer of mail delivery.
In 2010, the U.S. Postal Service asked the Postal Regulatory Commission to issue an opinion on moving to five-day delivery. At the time, the Postal Service claimed that the reduction would result in significant savings while incurring only a modest reduction in revenue.
But, in 2011, when the commission issued its independent opinion of what savings would result from moving to five-day delivery, its research concluded that the potential cost savings had been greatly overstated by the Postal Service. The Postal Service then dropped its plan two years ago to end Saturday mail delivery.
Earlier this year I entered the White Hall Post Office on a Saturday morning and found the clerk on duty behind the counter wearing a white T-shirt and bib overalls. “Is that their new poverty uniform?” a woman in the line ahead of me wondered out loud.
However, to restore the Postal Service to long-term financial stability, the agency must have the flexibility to reduce costs and come up with new revenues.
The Postal Service still faces major financial challenges, but cutting service to postal customers is not the ultimate answer.
It’s just a question of whether the treatment is worse than the disease.
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Larry Fugate is a veteran journalist and former editor of The Pine Bluff Commercial. He can be reached by email at email@example.com or at (870) 329-7010.