View Mobile Site

Congress’ business savvy reflected in Postal Service’s financial quagmire

Text Size: Small Large Medium
POSTED March 17, 2010 2:31 a.m.
Not too many moons ago – before the Internet spawned spam to give junk mail a good name – Congress set up the Postal Service as a separate entity.

Everyone working for the Post Office up until 1971 were federal employees. It was the year the Postal Service as we now know it was launched to start ever-so-slowly weaning themselves off taxpayer subsidies.

The idea was to make the Postal Service self-sufficient and to run more “business-like” which is a dangerous concept when uttered from the mouths of politicians.

The Postal Service today is on course to end up losing $7.2 billion when 2010 ends. The agency is also close to maxing out the limit they can borrow.

This doesn’t look too good for an agency with over 700,000 workers that is only second to Wal-Mart when it comes to providing jobs.

It’s bad business practices sinking the Postal Service, right? Wrong unless you consider what Congress is doing to the Postal Service to be standard business practices.

Congress has proven to be fourth class – if that – in terms of their expertise in how to set up an independent business. This shouldn’t surprise anyone in the private sector considering how federal regulations often seem to have no rhyme or reason except create burdens, financial and otherwise.

Try running your business, though, with what Congress has saddled the Postal Service with in terms of costs and requirements:

•The Postal Service is required to cover the entire retirement tab for employees including those who were working before 1971. The Office of the Inspector General issued a report in January that contends the Postal Service has been overcharged $75 billion over the years by being forced to pay up front pension funds for years of service before 1971. The report notes the Postal Service, if the money were returned to it, would create a pension surplus that could eliminate issues with the health benefits fund. Simply transferring the debt back to the federal, government that was incurred before 1971 in terms of pension liabilities could wipe out the agency’s deficit and put it on a near break-even basis.

•The Postal Service is prohibited from reducing service from six to five days.

•Politicians mandated that the Postal Service has only two options to operate within which is either hiking rates or cutting back on their fixed expenses.

Truly free the Postal Service - and even let it venture into other products – and you might be surprised at what happens.

All you have to do is check on the resourcefulness of the men and women who actually deliver the mail.

The Manteca rank-and-file can share stories over the years of how the upper echelon in Postal Service management – still caught in the federal bureaucracy mindset – would get on their case for finishing routes too soon. In other words, they were chastised for being too efficient.

Those days are slowly disappearing but it underscores the fact that most of the people who deliver your mail are up to the challenge and always have been.

By hamstringing the Postal Service, Congress is playing into the hands of the naysayers who claim the mailed letter – and the dozens of pounds of magazines, bills, and other printed material that most of us still get every year – is going to suffer the same fate as political decorum and disappear from the landscape.

No one is arguing the Internet - or whatever the next big thing in communication might be – isn’t a challenging force to reckon with.  But they are simply tools for commerce and communication and not the end product. For all of the advantages of the Internet it still doesn’t physically deliver documents and packages into the hands of any American who has an address, postal box or general delivery.

Congress may eventually do what neither rain, nor snow, nor sleet, nor hail has failed to do which is to prevent the Postal Service from making its appointed rounds.

That’s the beauty of having folks who haven’t balanced a budget now for almost a century tinkering with businesses whether it is the delivery of mail or health care.
Commenting is not available.

Commenting not available.

Please wait ...