Thursday, September 24, 2009

Postal Relief? How About No More Congressional Thievery?

The U.S. Postal Service may be a week away from defaulting on a payment to the federal government. I kind of hope that happens.

As someone who works for a company that relies heavily on the Postal Service to deliver our magazines, I'm supposed to be urging passage of legislation that would give USPS partial, temporary relief from a $5 billion-plus payment due next Wednesday to a retiree-benefits fund. (A House-Senate panel included the proposal in a broader bill that it passed today, but that must now go back to both bodies for votes.) After all, how often do postal management, postal unions, mail-dependent industries, and the majority of Congress agree on an issue involving money?

Instead, I told Publishing Executive in a recent interview that this "may be just the kind of crisis we need" to turn around a Postal Service whose current model is not viable. Don't get me wrong -- I think Congress should pass the legislation. But I hope it doesn't.

Let me explain my heresy:

The billions of dollars the Postal Service pre-pays every year into a retirement-benefits fund has nothing to do with retirees and everything to do with making the federal deficit look smaller. Congress is playing an accounting shell game, with the cost of the payments being passed along to mailers in the form of higher rates.

That has made mailed products increasingly uncompetitive with such electronic substitutes as email and Web sites, leading to volume decreases and excess capacity in the postal system. (For more information about the pre-payments problem and other ways Congress interferes with the supposedly independent Postal Service, see How USPS Could Bypass Congress on Saturday Delivery.)

I can't get excited about a proposed law in which Congress would basically be saying to USPS, "For the next couple of years, we won't steal as much from you as we used to." I fear with its passage Congress would say, "Now that we've bailed you out, you're not going to close any post offices in our districts or deliver only five days a week, right?"

The legislation would ease the Postal Service's financial crisis but not get at the root of the problem.

I hope Congress instead embarrasses itself by failing to act before the Sept. 30 deadline and allowing the Postal Service to do a government version of Chapter 11. Perhaps then it would realize that you can't run a postal system with 535 CEOs.

Perhaps then it will grant USPS the freedom it needs to reduce its costs structure by carrying out a sensible and humane downsizing of its workforce and facilities. Perhaps then Congress will consider depoliticizing the process of closing post offices the way it did with military bases.

The interview goes into more detail about fixing the Postal Service and also covers such topics as managing paper costs and the environmental debate about print versus digital content.


Anonymous said...

I see, the mailers want to end Congressional thievery
because it might interfere with the mailers thievery.
Again they want their advertising mail to be subsidized through pay cuts and layoffs. Don't cut
Saturday delivery though, the catalog have got to go through.

Anonymous said...

This is the first time I've seen a mailer complain that the pre-funding requirement (which is ridiculous, everyone agrees except Congress) increases their cost. Work-sharing discounts aren't enough; mailers want more.

There's no mention of S.1507, but I think we can safely assume the mailers support that as well.

No wonder Burrus calls them "vermin".

Anonymous said...

Usps is not part of the federal deficit although controlled through congress. They are also not asking for a bailout but only to be excused from a mandate that required them to prefund retirees health benefits when they already had a fund dedicated to that. They are a public service that does not recieve any tax dollars except to subsidize nonprofit mailers

Anonymous said...

By humane I hope you don't mean a shot to the head.