Diary

Post Office Needs Major Reform

The Washington Monument Ploy is a tactic used by government bureaucrats that works like this: Imagine the city of Washington, DC is facing a budget crisis. So rather than throw freeloaders off the dole or cut the deadwood from the city bureaucracy, the city closes the highly-visible Washington Monument in a cost-cutting action. The people are so horrified that they immediately agree to big tax increases to keep the Monument open.

 

The same thing now is happening with the United States Postal Service (USPS) which is planning to close as many as 2,000 local post offices in 2011 to plug an estimated 2010 budget deficit of $8.5 billion that may grow larger this year.

 

These closings are unnecessary and are very harmful to the small towns where most of them are going to happen. There are many other things that can be done to contain costs but USPS is operating like a typical bureaucracy, cutting essential or visible services instead… just like closing the Washington Monument.

 

The Wall Street Journal Online recently ran a story on the terrible losses that small towns feel when their post offices are closed. But the reason this is happening is because the post office has acted irresponsibly over the flush years in every way. There currently are about 32,000 individual brick-and-mortar post offices in the US including many expensive new buildings when many POs could have been combined or located inside local retail establishments, thus saving money.

 

Many other ways could have been found to deliver the mail more efficiently if the Post Office were run like Fed Ex. But it is not. It is one of the most notorious bureaucracies in America and now is in a huge hole. And its answer is to shift the hurt to small-town America rather than reform its operations. Yet these closings will only represent a fraction of the needed savings. This is the mean-spirited and selfish bureaucracy at work.

 

*The first line of thrift should not be to close post offices but simply to take the $8.5 billion deficit and cut the salaries, benefits and pension of postal workers by $8.5 billon and by the USPS deficit figure for every year thereafter. Period. End of story.

 

Unionized postal workers have been getting steadily increasing salaries, benefits and pensions for decades and it is time for them to give back. These increases all have come at the expense of USPS customers who have been paying steadily increasing postal rates.

 

Among other things, USPS is saddled with billions in unusually burdensome retiree health costs. USPS employs 532,800 workers. The agency has reduced its work force by more than 120,000 employees since 2002.

 

*A report from the Office of Inspector General said the postal service could save $700 million this year alone by asking employees to pay more for their health and life insurance plans. Postal workers pay “significantly” lower premiums for their plans than other government employees because of union agreements, according to the study.

 

According to a separate study from the Congressional Research Service called The U.S. Postal Service’s Financial Condition: Overview and Issues for Congress by Kevin R. Kosar issued  March 17, 2010:

 

‘Between FY2005 and FY2009, the USPS’s debt rose from $0 to $10.2 billion. (The agency’s statutory debt limit is $15 billion… Mail volumes slid from 213.1 billion mail pieces in FY2006 to 212.2 billion in FY2007, and dropped to 202.7 billion in FY2008. Despite the drop in mail pieces, the USPS’s revenues actually held steady during those years—$72.7 billion, $74.8 billion, and $74.9 billion—largely due to postage increases.

 

However, FY2009 did bring both a drop in mail sent and postage purchased. Mail volume fell 12.4%, from 202.7 billion to 177.1 billion mail pieces, and operating revenues declined 9.1%, from $74.9 billion to $68.1 billion.’ (end of excerpt)

 

Competition from electronic communication is harming the USPS monopoly. Mail volume could fall further to 150 billion pieces in the next 10 years, predicted the report.

 

*The third easy step in the USPS cost-cutting program would be to eliminate Saturday mail delivery. This would spread the cost reductions equally among all Americans rather than putting the onus on small towns and rural areas by closing their post offices. Saturday delivery is not crucial. Americans will get used to it. The postal systems in other countries like Canada already operate on a five-day schedule. Any budget surplus produced by eliminating Saturday delivery then could go to reducing postage rates for the first time ever.

 

According to the Kosar report:

 

‘GAO has suggested that Congress should consider permitting the USPS to reduce its delivery schedule from six to five days, a policy with which the USPS concurs. To date, the estimates of possible savings… range from $1.9 billion to $3.5 billion. (No studies have argued the contrary—that moving to five-day delivery would increase costs.) (end of excerpt)

 

Reported the Wall Street Journal Online about small-town and rural post office closings:

 

‘The news is crushing in many remote communities where the post office is often the heart of the town and the closest link to the rest of the country. Shuttering them, critics say, also puts an enormous burden on people, particularly on the elderly, who find it difficult to travel out of town.

 

…A disproportionate number of the thousands of post offices under review are in rural or smaller suburban areas…

 

“It ain’t right doing this to our community,” says Delmer Clark, a 70-year-old retired coal miner in Eastern Kentucky’s Appalachian Mountains, in the no-stoplight town of Holmes Mill.’ (end of excerpt)

 

Once again, this is another blow to conservative rural America whose economies already are reeling from the heavy hand of obstructionist environmentalism coming from the Democrat left.

 

Conclusion: There are many ways to solve the USPS budget problems besides balancing the budget on the backs of rural Americans and small-town people. 

 

Please visit my website at www.nikitas3.com for more. You can read excerpts from my book, Right Is Right, which explains why only conservatism can maintain our freedom and prosperity.