Senators Urge Postal Service To Delay Closings

Slash your budget, but don’t close any post offices. That’s the impossible message the United States Senate is sending to the United States Postal Service this week. Las week the Senate passed a bill revamping the postal service, and structuring financial reform of the quasi-governmental corporation. However, significant differences between the Senate passed measure and the House version still awaiting a floor vote could well delay any final legislative action well beyond May 15. That’s the date USPS proposes to resume closure of various post offices and mail distribution centers around the country under the ambitious USPS $22 billion cost cutting plan.

Four Senators have written USPS Postmaster General Patrick Donahoe asking USPS to hold off on any such closings until Congress can act – or putting it more bluntly – get its act together. “We believe an attempt to proceed with the planned closures to get ‘in under the wire’ while legislation to the contrary is being considered would be counterproductive and would violate the clear intent of the Senate,” according to the letter signed by Senators Scott Brown, Thomas Carper, Susan Collins and Joseph Lieberman. However, neither that letter nor the Senate bill explains how USPS is to achieve the needed cost savings in the absence of the proposed post office and mail center closings.

It’s a typical Congressional knee jerk reaction to every budget crisis: “Slash your expenses, Mr. Bureaucrat, but don’t cut jobs or services in my district.” Trouble is, even the dimmest bulb in the Capitol chandelier knows that is an impossible task. Welcome to Wonderland, Alice!

Connecticut Senator Joe Lieberman, one of the sponsors of the Senate passed bill which prohibits the planned closures, says his proposal will “remove some of the immediate financial pressure on the Postal Service” while “avoiding extreme changes that could further destabilize USPS.” What he means is that Congress now realizes it made a mistake in requiring USPS to prefund retired postal employee health benefits, since doing so has publicized one of the all time Ponzi scheme frauds of government accounting: the government promises expansive and expensive pensions and health benefits to retiring employees without putting away a dime to pay for them, or even reflecting the obligations on the government’s books.

This new Congressional requirement has meant USPS needed to put $21 billion in the bank over the last five years, resulting in USPS deficits skyrocketing from a mere $4 billion over that period to a total of $25 billion. Ouch! Think of it: every time you send an E-mail rather than a letter, you take away the money to pay for a few seconds of retired postal worker health benefits.

Postal employee unions are busy in the halls of the Capitol lobbying hard against both the House and Senate bills and the USPS austerity plan. All three would mean dramatic job losses and service cuts. The USPS proposal to drop Saturday mail deliveries would slash 80,000 jobs, at an annual savings of $2.7 billion. The unions are upset, and Congress wants to put off Saturday delivery cuts for at least 2 years. Nobody in the House or Senate has a plan to cover the $5.4 billion loss that would result, however.

Speaking about the pending legislative measures, National Postal Mail Handlers Union President John Hegarty says, “We’re not endorsing it whole-heartedly. We’ve come out in cautious support, recognizing there are still some improvements that need to be made.” Meaning: cut fewer jobs, bank more money for retirees. National Association of Letter Carriers Chief of Staff James Sauber is more sanguine: “We’re sort of disappointed … It’s sort of a missed opportunity, sort of tinkering around the edges.” American Postal Workers Union Executive Vice President Greg Bell characterizes the Senate measure like this, “It’s an improvement over the original bill, but we still have some issues.”

Among the issues Bell cites are proposals to cut compensation for work related injuries to federal employees, and to permit USPS to withdraw from the Federal Employees Health Benefits Program and set up a less expensive benefit for postal workers. Apparently the only thing most of the folks affected can agree on: cutting back compensation to upper level managers in the USPS, who now make considerably more than department secretaries in the Obama Cabinet.

Playing Politics With The Postal Service

Late Wednesday, April 25, by a vote of 62-37, the Senate passed SB1789, its version of Postal Service reform. The House has yet to take up HR2309, its competing Postal Service reform measure. As usual in the current Congress, these two bills from opposite sides of the capitol rotunda threaten gridlock over reforms the Postal Service itself is fully prepared to make in a last ditch effort to stave off explosive growth of the “independent” corporation’s $12 billion debt. In an election year with both political parties clamoring for deficit reduction and government fiscal responsibility, it’s another symptom of that chronic Congressional disease “we have to live within our means, unless, of course, it hurts.”

Postal service leaders themselves have written the prescription for the bitter fiscal medicine their agency will have to swallow to regain some modicum of fiscal health: save $6.5 billion per year by ending Saturday mail deliveries;  closing 220 redundant mail processing centers and 3,700 local post offices; cutting 100,000 jobs; and stretching out a 10 year payment schedule for funding $5.5 billion a year into retiree health benefits from 10 years to 40 years. Not content to let the appointed Postal Service business managers do such budget slashing in an election year, Senators have intervened in SB1789 to make it nearly impossible for Postal Service managers to meet the needs of their own agency’s financial soundness.

A decade ago, the Postal Service handled 202.8 billion pieces of mail annually – last year, the agency handled only 168 billion. The advent of E-mail and on line bill payment accounts for the largest part of that volume loss. But, while agency leaders are fully prepared to close facilities and cut employment to reflect the continuing decline in mail volume, Senators are clearly not. After considering 39 proposed amendments over two days, the measure as passed prohibits the Postal service from closing any rural post office if the nearest alternative location is more than ten miles away. The bill also requires the agency to maintain next day delivery of mail sent to nearby communities, and to continue Saturday mail deliveries for at least two more years. In the face of predictions that the Postal Service will reach its congressionally imposed debt ceiling of $15 billion within this year, the Senate’s action is unconscionable.

California Congressman Darrel Issa, lead sponsor of HR2309, calls the Senate bill “wholly unacceptable,” and he’s right. Issa’s measure would allow the Postal Service to end Saturday mail service, streamline postage rates, and require postal employees to pay the same health insurance premiums as federal government employees. Rather than permitting Postal Service managers free reign in mail handling center and post office closings, though, Issa’s legislation sets up a commission to vet postal facility closures. It seems neither Senators nor Congressmen can stand to give up their right to be free themselves from the effects of government cost reduction.

Downsizing government in their own districts to save taxpayers money is a medicine politicians can’t bring themselves to swallow under any circumstances.