The truth about postal reform
Now that U.S. Senate has passed a bill, S 1789, to reform the ailing U.S. Postal Service, critics are trying to disable the bill on its way to the House of Representatives. Business Week recently catalogued unhappy stakeholders, including postal unions, postal management and some Republicans who wrongly think the bill burdens taxpayers.
Rep. Darrell Issa (R-Calif.), whose own bill awaits action in the House, blasted “special interests.” But Business Week says, “Considering how many people are unhappy with the bill, it isn’t clear which special interests Issa is referring to.”
Some see Senate bill as the inevitable product of the sausage machine. But it is neither a budget buster nor processed meat. It is the expression of a better vision of the Postal Service.
If you consider that survival of the service means maintaining the circulatory system for a $1.1 trillion mailing industry — or in other words, making sure cash, greeting cards, packages and newspapers and magazines arrive on time, the Senate bill is good medicine.
Consider some of the alternative fixes.
Issa’s bill would let USPS immediately end Saturday mail, close half the mail processing centers and thousands of post offices, and put a new board of political appointees in charge. The new board would be expected to trim workers’ benefits and maybe wages, and direct the Postmaster General to favor profit over service.
At the other extreme might be Sen. Bernie Sanders (I-VT), who wanted to keep everything open. Labor unions backing him say that USPS will heal as the economy heals. Then there is the White House’s notion: to raise postage rates.
For Sens. Susan Collins (R-Maine) and Joe Lieberman (I-Conn.) neither extreme is suited to long-term survival of USPS.
To many experts, Issa’s approach is likely to frighten away businesses that mail. The Lieberman-Collins bill agrees that USPS needs a more flexible, less costly workforce. It keeps mail flowing through today’s network while cost-cutting is underway.
For example, they would end Saturday mail delivery in two years, but only if USPS has taken other big steps toward financial viability. They would allow the closing of postal plants now, if USPS takes preserves local mail delivery speed.
Is their bill the product of compromise, or of a different vision? Consider:
• The Postal Service’s plant-closing plan is based on a desire to amass more mail at automated urban centers, where costly machines sit idle much of the day. To optimize machines, USPS would haul mail much farther. But the hauling would slow the mailstream, particularly in small towns and rural areas that are far from mail plants and create a set of second-class citizens who get and send mail more slowly than urban dwellers. It will also hamper smaller communities’ quests for economic development.
• Many Americans say they wouldn’t miss Saturday mail. But USPS builds its system around senders, not receivers. Who would be hurt by a five-day delivery regime? Anyone who depends on timely mail delivery. Shutting down the system two days a week — three when Monday holidays occur — would create delay, according to the Postal Regulatory Commission. Then there are those who need prescriptions delivered when they are at home; small-town citizens who get the newspaper by mail and businesses needing six-day cash flows.
• Closing small post offices seems a no-brainer to city dwellers who spot those one-room POs at the roadside on the way to the beach. Surely not all are needed. But rather than closing them entirely, USPS could have circuit-rider postmasters to open them a few hours a day. That is affordable if worker benefits are brought into line with the private sector. For those communities, a circuit rider could continue their links to the world.
• The Congressional Budget Office says the Senate bill would cost $33.6 billion, adding to the federal deficit. But postage-payers, not taxpayers, carry that burden. Taxpayers face a liability as the funder-of-last resort only if postage revenues dry up — which is more likely to happen if the mail slows to a crawl.
Finally, members of Congress may differ on how they see USPS. Is it a corporation? Is it a government agency responsible for binding the nation together?
Fact: It is a Government-Sponsored Enterprise or GSE, more like Fannie Mae than like IBM or the Defense Department. It has to use business tools, but carry out a public mission. And it has enormous power in the marketplace. Consider, for example, its new Every Door Direct Mail program, which directly competes with many private businesses. Members of Congress who mistakenly see postal reform as an exercise in deregulating a company may actually unleash a powerful federal agency, while those who look to raising postage so generous worker benefits can continue could pull the plug on the economic engine that keeps jobs alive.
It isn’t compromise that is needed, but a clear-eyed vision based on a full understanding of the needs of all who the Postal Service serves. Postal management today has an impossible task, expected to accomplish business goals without the cost-controlling tools businesses have, and expected to achieve government ends without federal support. Congress owns this confusion. Only Congress can fix it and it will continue to need to fine-tune its solutions as communications cultures change. No bill passed today will avoid the need for legislation in the future. Neither “deregulating” it nor hiking rates will get USPS to stability. Nor will abrupt and disruptive approaches to labor costs.
Senators Collins and Lieberman, along with co-sponsors Tom Carper (D-Del.) and Scott Brown (R-Mass.) have devoted endless hours to understanding the challenge and to crafting the next steps toward fixing it. Their approach deserves considerably more respect than it is getting.
By Reed Anfinson
President of the National Newspaper Association
and publisher of the Swift County Monitor-News in Minnesota