Saturday, April 16, 2016

244.7 - Outrage of the Week: undermining the Postal Service

Outrage of the Week: undermining the Postal Service

Now for our other regular feature, the Outrage of the Week. This one is going to require a bit of background.

A couple of times over the past five years or so I have written about the recurring attempts to undermine and ultimately do away with the US Postal Service. We have had repeated waves of claims that the USPS was on the brink of financial collapse, of fiscal disaster, of crushing bankruptcy; it's on the edge, the precipice, of utter failure and ruin.

Nearly five years ago, the New York Times was telling us that "the United States Postal Service has long lived on the financial edge, but it has never been as close to the precipice as it is today." In the years since, the drumbeat of impeding doom and disaster has gotten both louder and softer, but it has never stopped.

You might be forgiven if you wonder how this can continue for year after year, how the agency can continue for year after year to be on the precipice without ever falling into the abyss, but that doesn't matter to the true believers in imminent catastrophe - or, more to the point, to those who want to bring on the catastrophe in order to do away with the Postal Service, turning the job over to private profit while destroying one of the biggest and strongest unions in the US, that of the postal workers.

But let's face some facts: Mail is a bargain. You can mail a one-ounce letter, about three sheets - that's six pages of text - anywhere is the US; you could send one from Key West to Point Barrow, for 49¢, an amount that otherwise might get you half a candy bar.

And when I say anywhere, I do mean anywhere. The USPS is legally required to provide universal service and it makes deliveries to over 150 million individual addresses nationwide every week. It has to make mail service available to everywhere - you may have to travel a bit to get to a post box or to where a whole group of mailboxes stand at the end of some rural byway, but mail must be available to everyone. Even if you are way out in the country, even if you are in some neighborhood deemed "too dangerous" for services like taxis, the mail still must be available. That is a requirement which does not exist for the Postal Service's private competitors like UPS and FedEx. They don’t have to do that: They think your address is too inconvenient or too risky or otherwise not profitable, they just don't do it.

At the same time, the thing is that the Postal Service is in a truly weird situation. It is a quasi-governmental agency, run independently but still subject to legal restrictions set down by Congress even though it receives no federal money, no taxpayer money at all. It's entirely funded through the sale of postage and postal services. Despite that, despite contributing not a penny to its support, Congress has a huge say in how the USPS is operated.

For example, in 2006, Congress passed the Postal Accountability Enhancement Act, one of those classically misnamed bits of legislation. Among other things, that bill mandated that within 10 years, that is by 2016, the Postal Service fully fund retiree health benefits for future retirees out to 75 years in the future. That is, Congress was requiring of the USPS that within 10 years it have enough money set aside to fully fund health care benefits for future retirees who hadn't even been born yet. That is a requirement of, a task taken on by, no other agency, corporation, or organization in or out of any level of government in the US. And it's costing the USPS about $5.5 billion a year, an amount significantly larger than the annual deficit that we're told has it perpetually on the edge of collapse.

Despite all that, the Postal Service has not only managed to survive, things were actually looking a little brighter: In February, the USPS was able to report that in the first quarter of FY2016, it posted a net income of $307 million, a reversal from a string of losses.

And now we come to the Outrage of the Week: Something else Congress did a while back was to ban the agency from raising the cost of postage beyond the inflation rate. Two years ago, the Postal Regulatory Commission allowed a temporary hike above that limit, raising the price of a stamp to 49 cents.

On April 10, the price of a stamp dropped back to 47 cents, a two cent drop that will save each of us almost nothing but represents a $2 billion annual loss to the Postal Service. Just at the moment the Postal Service might be beginning to see a glimmer of fiscal daylight through the surrounding darkness, that is the moment that the Postal Regulatory Commission dealt the agency a $2 billion blow by its failure or perhaps unwillingness to extend the temporary hike.

The US Postal Service has been ranked number one in overall service performance of the postal services in the 20 wealthiest nations, it has been named the Most Trusted Government Agency for six years running, and has been ranked the sixth Most Trusted Business in the nation. The USPS is proof that even under ridiculous handicaps, government programs can work and work well - and that, along with the fact that it also proves that a strongly-unionized workforce can provide for its members while still maintaining a high level or service, has given a panoply of reactionaries more than enough reason to strive to make it fail.

I don't know if the Postal Regulatory Commission's failure to act is part of that effort or just the result of callous and bone-headed indifference to the impact. I do know that it is an outrage.

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