Tuesday, September 27, 2011

How to #SaveUSPS? Remove the Fangs from Its Throat

The rally today on the Capitol Square in Madison to save the US Postal Service was good. It was well attended, and the weather didn't interfere. We had a few speakers—politicians and union leaders—and we handed out info sheets, asked folks to sign the petition supporting HR 1351, and talked to people about what's needed to save the USPS. Best of all, it was heartening to hang out with other posties.

This rally and hundreds of others across the country were planned by the postal unions to garner support for HR 1351, the USPS Pension Obligation Recalculation and Restoration Act. From the rally, you might think that the one magical fix needed to ease all of the USPS's woes is just to pass this one bill. In fact, the bill is a needed but tiny step toward fixing the Post Office's situation. It is a temporary fix for one of the worst provisions of the 2006 Postal Accountability and Enhancement Act, which in fact dealt two ruinous blows to USPS finances.

The PAEA requires that the USPS transfer to the Treasury $5.5 billion per year for 10 years, ostensibly to fund future retiree health benefits for the next 75 years. This is the part of the PAEA that the postal unions are most concerned about, because it places an undue and even absurd burden on the USPS that is placed on no other government agency. In fact, it forces the USPS to provide for the retirement health benefits of people who aren't even born yet.

Another provision of the PAEA caps all postage rates for "market dominant" service at the rate of increase of the Consumer Price Index. "Market dominant" service is anything that the USPS has little or no competition for, such as first-class mail and bulk mail, including catalogs, periodicals, and advertising circulars. This requirement directly contradicts 39 USC 101(d), which states that "postal rates shall be established to apportion the costs of all postal operations to all users of the mail on a fair and equitable basis." In other words, the prices the Post Office charges should cover its overall expenses. But the provision in the PAEA actually prohibits that it do so. And, of course, the price of fuel has increased considerably faster than has the Consumer Price Index.

HR 1351 does nothing to address the postage rate cap, which is ruinous because the USPS loses money on every single catalog and other piece of bulk mail it processes and delivers. HR 1351 does not even repeal the prefunding requirement, the excessive obligation faced by no private company and no government agency. Instead, HR 1351 merely allows the USPS to use money it has already overpaid into its pension funds to cover future payments to the retiree health benefit fund. HR 1351 would reduce the size of the largest hole in the USPS's budget, the $5.5 billion per year prefunding requirement. This would be good, but it would not prevent the destruction of the U.S. Postal Service.

The fundamental threat to the USPS comes from its own management. Easing the artificial financial burden on the USPS would reduce the need to savagely sever employees, jettison post offices, and dismantle the distribution network. But the problem was never a need to do these things. The USPS's finances could be perfect, and management could—and, from its recent words and actions, would—still seek to destroy the USPS as we know it.
  • Postal management wants reduce delivery from 6 days per week to 5 days per week, which, as we have already pointed out, is a colossally bad idea. Former president of the APWU William Burrus cites the folly of going with a 5-day delivery scheme:
  • The Postal Service has been granted a monopoly on access to the mailbox, but if the USPS abandons delivery on a sixth day, it is doubtful the American public will permit the monopoly to continue. If five-day delivery were enacted, the Private Express Statute would likely be modified to permit a private company to deliver mail on the non-delivery day. Rest assured, once the sanctity of the mail box is pierced, it will not be restored at a later date.
  • Postal management wants to separate retail sales from sorting and delivery operations, as a prelude to abandoning its retail network to private stores and outsourcing sorting and delivery to private mail-processing and delivery companies.
  • It wants to close half of the nation's post offices. USPS management seeks to close 16,000 of its present 32,000 post offices by 2017—essentially all those that aren't entry points for large amounts of bulk mail. Further closures would follow. These closures are illegal under current law, which stipulates that "no small post office shall be closed solely for operating at a deficit, it being the specific intent of the Congress that effective postal services be insured to residents of both urban and rural communities." Yet USPS management fully intends to proceed with a massive number of closings.
  • USPS management wants to decimate its mail-processing network, closing some 313 of its approximately 487 mail-processing plants. Management knows, and admits, that the remaining few plants do not, and could not, have the capacity to handle even the current recession-reduced mail volume at current delivery standards. USPS management seeks the approval of the Postal Regulatory Commission to increase delivery times by at least a day or two for all mail. This will be the end of first-class mail as we know it, ceding all important mail delivery to FedEx and other expedited delivery services. By management's own estimates, this permanent destruction of its ability to provide first-class service would save costs amounting to only 4% of budget.
Any one of the above attacks is sufficient to cause the ultimate destruction of the US Postal Service. So any effective effort to defend the USPS as we know it must address every single one of them and the reason the USPS is facing this multipronged attack. The New York Metro Area Postal Union (APWU, AFL-CIO) is demanding that Postmaster General Patrick Donahoe resign immediately, and if he will not, it calls on the Postal Board of Governors to fire him. In colluding with those who would destroy the USPS, "Donahoe is violating his oath of office and failing to meet the requirements of his position to be responsible for the overall operation of the Postal Service."

The New York Metro Area Postal Union is absolutely right, and the postal unions would do well to join the call for the Postmaster General's resignation. Furthermore, they should insist that the USPS again be managed as a government service and not as a business. The management of the USPS has been captured by the private mailing industry to the point that decisions are made for the benefit of big mailers and not for the American people—whom the post office is meant to serve. The "uncoupling" that is really needed, contrary to the USPS Office of the Inspector General's assertion, is that the fangs of the private mailing industry should be removed from the throat of the USPS.

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