So reads the title of this NY Times story by Steven Greenhouse. The problems of the Postal Service should surprise few: email, electronic bill paying, competition from the package delivery services, the ability to get catalogs via electronic delivery. What caught my attention, however, is some of the proposed solutions to the agency's severe financial problems:
They include eliminating Saturday mail delivery, closing up to 3,700 postal locations and laying off 120,000 workers — nearly one-fifth of the agency’s work force — despite a no-layoffs clause in the unions’ contracts.
Nice to hear of laying off almost 20% of the agency's workforce - on Labor Day.
But it gets worse.
Labor represents 80 percent of the agency’s expenses, compared with 53 percent at United Parcel Service and 32 percent at FedEx, its two biggest private competitors. Postal workers also receive more generous health benefits than most other federal employees.
And then there is this:
Congress is considering numerous emergency proposals — most notably, allowing the post office to recover billions of dollars that management says it overpaid to its employees’ pension funds. That fix would help the agency get through the short-term crisis, but would delay the day of reckoning on bigger issues.
There is no doubt there is a crisis. But even the way the article is shaped does not fully address some of the real causes of the crisis, which has included subsidization of commercial mail at less than that actual cost of processing it. Of course, raising the price to actual costs might well drive more business away, accelerating the death spiral.
I suggest you may want to read the entire article. I have a few additional thoughts to offer below the fold.
A number of years ago I went through some letters my mother wrote to her mother while she was at college. Mom went to Cornell, in Ithaca NY. My grandparents lived on Central Park West, in the San Remo, with its famous twin towers - their apartment was one of two on one floor of one of the towers, I think the 23rd but it has been about half a century since I was last there. What I remember is that letters were occasionally delivered the same day, almost always the next day, and that there were deliveries twice daily.
The cost of postage has of course exploded since I was a child, when first class delivery was three cents, and air mail - which had to be separately indicated - was six.
I do not remember the proportion of what came to our house being junk mail. I note that on the average day in our current residence we receive between the two of us about a dozen pieces of mail, of which more than half are advertising of some sort or another, much of which is unsolicited. More than half our paper recycling is similarly catalogs and brochures we did not request. I wonder how much of the deficit of USPS is caused by what is effectively subsidization of this kind of product?
But then my mind turns back to the issue of the people, their pay, and their benefits.
The Postal Service currently employs 653,000, down from nearly 900,000 a decade ago. The Postmaster General wants to cut that number by 220,000, cutting 100,000 through attrition as well as laying off the aforementioned 120,000. It is true that the volume of mail has been dropping, the current estimated volume of 167 billion down 22% in the past 5 years. Given that most of the costs of USPS are labor related there is no doubt there have to be cuts.
But I worry that this crisis will be used as a model to go after other government employees in a way that is not close to being justified by the financials.
Even though there is an immediate crisis - the need to make a payment by Sept. 30 of more than $5 billion to fund future health care costs - the situation is complicated by several issues. Susan Collins, who is ranking on the Senate Committee with oversight, is adamantly opposed to eliminating Saturday deliveries, noting that people in rural areas are often receiving prescriptions and other critical items through the mail. For those in more urban and suburban areas, it is cost effective to deliver, which is why the package services like Fed Ex and UPS have gobbled up so much of the business. LIke so many other things in life, there is less commercial service available in rural areas, where something approaching 20% of our people still live. We have eliminated train service to smaller markets. It is far more expensive to fly to small airports than flying much further to major hubs where there is competition. As I have noted in other contexts, health care (including dental) is a real issue in rural areas.
There was a time when our rural areas were very poor. During the New Deal one key thing was rural electrification, which helped provide economic stimulus and opportunity to millions of Americans for whom progress had seemingly passed them by.
Thus I understand the concern of Senator Collins, who also argues that eliminating Saturday delivery would only save the USPS a few percent, although in a crisis every percent of savings can be critical. Noting today is a federal holiday, that would mean some people would go 3 days with no mail service at all.
The Obama administration has apparently expressed opposition to removing funds from the pensions that the actuaries say have been overpaid. Those funds would provide some breathing room. Still, it would be another step in the ongoing war on defined benefit public pensions. I am also reminded that one thing the corporate raiders have often done with target companies is removed funds they claimed were overpaid to pensions to have greater access to cash for other purposes.
I also note some of the proposals that are floating about - basing some facilities in WalMarts, for example. Now that would be interesting, given the unionized nature of postal workers and the hostility of Walmart of unions, including its record of shutting down sites that vote to unionize.
This paragraph caught my attention as well:
In some countries, post offices double as banks or sell insurance or cellphones. In the United States, the postal service is barred from entering many areas. Still, the agency is considering ideas, like gaining the right to deliver wine and beer, allowing commercial advertisements on postal trucks and in post offices, doing more “last-mile” deliveries for FedEx and U.P.S. and offering special hand-delivery services for correspondence and transactions for which e-mail is not considered secure enough.
Certainly there will have to be changes. Certainly costs must be cut. Certainly jobs will be eliminated.
I hope it can be accomplished without letting the likes of Darrell Issa advancing his idea for a special commission that would be empowered to break all the contract provisions and effectively break the unions. Fortunately, both Sen. Tom Carper (who chairs the relevant subcommittee) and Sen. Collins oppose Issa's proposal.
There may be no choice.
But I have to wonder about timing. Why is this story breaking today, on Labor Day? Why of all days of the year is this a featured story in the nation's "newspaper of record?"
Perhaps E. J Dionne has it right in his Washington Post column this morning. In The Last Labor Day? he begins like this:
Let’s get it over with and rename the holiday “Capital Day.” We may still celebrate Labor Day, but our culture has given up on honoring workers as the real creators of wealth and their honest toil — the phrase itself seems antique — as worthy of genuine respect.
The Postal Service is in trouble. That will delight some Republicans, who think it is another example of what should be privatized, to companies that pay their workers far less, provide poorer benefits, and will not provide services to areas more expensive to reach, such as our rural areas.
It is like so much of what is wrong in this country. We have been privatizing so much, but only those parts where profits can be maximized. We leave behind the hard to serve - in schools that will be the English Language Learners and the Special Ed kids and as always those in the rural areas.
Too many people have forgotten than before the New Deal far too many were left out of the American dream, and that even the New Deal did not fully include women and in order to get support from Southern Democrats (most of whom would be Republicans today) had to exclude African-Americans.
Times change. The Postal Service has to change. The issues it faces now could have been addressed over time, not in the midst of a crisis.
And this story could have come out on any other day than Labor Day.
But what do I know? I am a unionized public servant, a teacher, with a defined benefit pension and generous health care. I am in the eyes of many a major part of the problem.
This time is is the workers of the Postal Service.
This time it is the service provided to all by the USPS.
Already we have privatized prisons, and for profit "public charter' schools.
What will be next?
For profit courts?
We already have many courts including the nation's highest which seem determined to accelerate the dismantling of the public infrastructure of the nation, including the power to oversee and regulate for profit institutions.
How much longer before what is left of public services provided by the government all disappear?
I read an article today about a crisis in a major public institution.
On Labor Day.
It blamed a large part of the crisis on the costs and benefits of the workers.
I was saddened. And somewhat angered.
So I wrote this.
Do with it what you want.