The financially struggling U.S. Postal Service announced Wednesday that it plans to stop delivering mail on Saturdays — but will continue delivering packages — starting Aug. 1.
Unless forbidden to do so by Congress, which has moved in the past to prohibit five-day-a-week delivery, the agency for the first time will delivery mail only Monday through Friday. The move will save about $2 billion a year for the postal service, which has suffered tens of billions of dollars in losses in recent years with the advent of the Internet and e-commerce, officials said.
“The American public understands the financial challenges of the Postal Service and supports these steps as a responsible and reasonable approach to improving our financial situation,” postmaster general Patrick R. Donahoe said at a news conference. “The Postal Service has a responsibility to take the steps necessary to return to long-term financial stability and ensure the continued affordability of the U.S. Mail.”
The postal service plans to continue Saturday delivery of packages, which remain a profitable and growing part of the delivery business. Post offices would remain open on Saturdays so that customers can drop off mail or packages, buy postage stamps, or access their post office boxes, officials said. But hours likely would be reduced at thousands of smaller locations, they said.
The Postal Service said that it suffered a $15.9 billion net loss for fiscal 2012, which ended Sept. 30. That’s three times the loss recorded a year earlier.
The Postal Service has pushed to cancel Saturday mail delivery for years. It announced the decision on Wednesday without congressional approval, even though lawmakers have argued their consent is necessary in order to make the operational change. Postal officials are expected to argue that they do not need congressional action in order to halt Saturday delivery.
In the past, Congress has included a ban on five-day-a-week mail delivery in its appropriations bill. But the Postal Service is currently operating under a temporary spending measure, rather than an appropriations bill, and the agency is asking Congress not to reimpose the restriction when the spending measure expires on March 27.
A majority of Americans support ending Saturday mail, according to national polls conducted in recent years, and President Obama has proposed halting deliveries as part of his budget-cutting proposals. Though the Postal Service is a quasi-governmental, self-funding entity, its worker compensation and retirement plans are tied to the federal budget.
Lawmakers have tried unsuccessfully for years to enact a significant overhaul of the Postal Service, hoping to reshape the agency as a leaner organization that delivers mail less frequently and operates fewer post offices across the country.
The Senate last year passed a bipartisan measure that would have permitted an end to Saturday mail delivery only after USPS conducted two years of feasibility studies.
Opposition to significant changes rests mostly with lawmakers from far-flung rural communities, who fear that a change in schedules could jeopardize low-cost delivery of medicines and medical supplies to elderly customers. The publishing industry also has complained that any changes would force quicker magazine publication deadlines and require some publishers to seek private delivery options instead, likely raising newsstand prices.
h/t: Washington Post
After a stopgap measure last year, Congress will once again debate whether the United States Postal Service as we know it can survive. The better question is: Will Congress let it?
The U.S. Postal Service is at risk of defaulting on healthcare obligations or exceeding its debt limit by the end of the year. Last month, USPS management unveiled a “Path to Profitability” that would eliminate over a hundred thousand jobs, end Saturday service and loosen overnight delivery guarantees. The Postal Service also proposes to shutter thousands of post offices. “Under the existing laws, the overall financial situation for the Postal Service is poor,” says CFO Joe Corbett. Republicans have been more dire, and none more so than Oversight Committee Chairman Darrell Issa, who warned of a “crisis that is bringing USPS to the brink of collapse.”
Listening to Issa, you’d never know that the post office’s immediate crisis is largely of Congress’s own making. Conservatives aren’t wrong to say that the shift toward electronic mail – what USPS calls “e-diversion” – poses a challenge for the Postal Service’s business model. (The recent drop-off in mail is also a consequence of the recession-induced drop in advertising.)
ut even so, in the first quarter of this fiscal year, the post office would have made an operational profit, if not for a 75-year healthcare “pre-funding” mandate that applies to no other public or private institution in the United States.
The Postal Service fulfills its mandate without direct government funding. Faced with right-wing warnings about bailouts, the postal worker union this week is running a new round of TV ads reminding taxpayers that USPS is funded entirely by fees, not taxes. Guffey says the union — the largest of four representing post office workers — will likely hold rallies on next month’s Tax Day to drive home the same point.
Issa and other Republicans have been insisting for years that to stay solvent, USPS needs to make big cuts. In 2010, Issa told the postmaster general at a congressional hearing that the Postal Service has “more or less a third more people than you need. He warned in an Op-Ed that “Allowing USPS to postpone billions in obligations just makes a bailout easier.” In a December Op-Ed, Issa compared continuing Saturday mail service to “asking us to revive the Pony Express.”
Sanders is among the backers of the Postal Service Protection Act, whose recommendations are similar to the ones in the senators’ letter. Guffey says the most promising route to an acceptable compromise would be for these recommendations to be incorporated into a tri-partisan bill introduced by Sens. Joe Lieberman, Tom Carper, Susan Collins and Scott Brown.
Among USPS management’s proposed changes are a transformation of workers’ healthcare plans and the elimination of at least 155,000 jobs. USPS has already eliminated 130,00 full-time equivalent positions in the past three years. In a union contract signed in May 2011, APWU agreed to concessions in order to preserve its “no-layoff” clause; Guffey says that the Post Office’s projections, designed to make the case for further sacrifices from workers, fail to factor in savings from the concessions they’ve already agreed to. Union leaders expressed surprise last year when, within three months after signing the new contract with APWU, USPS issued white papers in support of congressional proposals to override those layoff protections. But Corbett says he believes the reduction can be accomplished through voluntary incentives.
Cutting those jobs would mean further reductions in public sector employment, including among veterans and African-Americans, who for decades have been over-represented in Postal Service ranks. “It just doesn’t seem like it’s the right time to go after veterans and their employment,” says Guffey. He wants Congress to maintain current delivery standards, which he says would save many post offices from closure.
Cuts have intangible costs as well. Interviewed for a Washington Postprofile of the endangered post office in Star Tannery, Va., one resident said, “Closing the post office would be one step toward eradicating small-town life in America.”
True to form, President Obama falls between Sanders and Issa: He would scale back the pre-funding requirement and allow postage rates to rise, but would also back the elimination of Saturday service. In an emailed statement, White House spokesperson Matt Lehrich wrote, “The President proposed a balanced plan that would return USPS to financial viability while saving taxpayers money, and Congressional action that enacts this type of balanced plan is necessary.”
h/t: Josh Eidelson at AlterNet