By Mark Dimondstein, Boston Globe, May 11, 2018
President Trump’s attention of late has been focused in part on the United States Postal Service and Amazon, resulting in a new executive order calling for an evaluation of USPS finances. This is a good opportunity to underscore some important facts regarding the Postal Service, a national treasure belonging to all the people of the United States.
Tax dollars do not fund Postal Service operations. Instead, it operates on earned revenue from postage and other products and services. As a self-funding independent agency, the Postal Service provides universal service at uniform and reasonable rates, delivering to 157 million addresses six (and sometimes seven) days a week, no matter who customers are or where they live.
Contrary to conventional wisdom, the primary source of current Postal Service financial challenges is not the decline of letter mail. Rather, the red ink derives almost entirely from the bipartisan congressional enactment of the 2006 Postal Accountability and Enhancement Act. The act compelled the Postal Service to pre-fund 100 percent of future retiree health care costs, 75 years into the future, for workers not even born yet. This mandate transferring postal revenues to the federal treasury bilked the Postal Service out of $5.6 billion a year over a 10-year period. No other company or agency faces, or could survive, such an onerous financial burden. Adding to the absurdity is the fact that, prior to the new law, the Postal Service had been reliably paying the retirement health benefit premiums as they arose, as do other companies and agencies. Without this manufactured pre-funding crisis, the US Postal Service would have shown a positive net income in four of the last five years averaging close to $1 billion annually — again, without a dime of taxpayer money.
The same 2006 law placed further strain on postal finances with an unreasonably restrictive price cap on postage rates. While it helped the profits of huge mailers, it diminished services for the general public. Combined with the pre-funding debacle, this price cap contributed to reduced hours, closing of post offices, slower delivery standards, and severe short staffing, leading to longer lines and later delivery times.
The public post office, established by the Constitution, is a democratic right of the population and has helped bind the people of this country together for the last 240 years. The Postal Service, with its dedicated and accountable workforce, is consistently rated the most trusted and respected government agency. In these days of the e-commerce revolution, it is as vital as ever. Noteworthy is that in the Internet age, lack of security and invasion of our privacy has become the norm. The US mail may just be the last bastion of private and secure communication.
New challenges certainly exist, but the solutions are not complicated. Congress should fix the pre-funding fiasco. Common-sense bipartisan bills, currently stalled in both the Senate and House, would do just that. The Postal Regulatory Commission can eliminate the arbitrary and artificial price cap and give the USPS more pricing flexibility so large mailers pay their fair share. This still will allow the Postal Service to maintain the lowest postal rates in the industrialized world.
Postal workers and millions and millions of customers certainly hope that the task force created by the executive order has as its starting point a sincere commitment to helping the Postal Service thrive. However, if the task force proves to be a smokescreen to promote the postal privatization agenda of the likes of the Heritage Foundation and Cato Institute and their billionaire benefactors’ efforts to turn the common good over to private profiteers, then postal workers will be on the front lines fighting back, united with our communities and the people of this country, to ensure a vibrant public postal service for many generations to come.