Published April 14, 2020 by the New York Times
From the census to the November election, the Postal Service is critical to American democracy.
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America’s favorite government agency is on the brink of collapse, and Washington policymakers appear too mired in politics to save it.
Like so many businesses, the United States Postal Service has been hit hard by the coronavirus. Mail volume is down nearly a third over this time last year and continues to fall. The Postal Service is predicting $13 billion in lost revenue this fiscal year as a direct result of the pandemic. In an April 9 telebriefing to the House Oversight and Reform Committee, the postmaster general, Megan Brennan, warned that without financial assistance the agency could run out of money by the end of September.
The Postal Service cannot be allowed to crumble in the midst of a national emergency. Though organized as a self-sustaining quasi-governmental enterprise, run without taxpayer funding, it is not just another business. Even in an increasingly wired world, the agency’s mandate of “universal service” provides a lifeline to remote areas. As this pandemic rages, its 600,000-plus employees are working to ensure that Americans receive their prescriptions and protective equipment and other essential items, no matter where they live. Nearly 500 postal workers have tested positive for the virus, with hundreds more suspected of having it, according to The Washington Post.
This year, the Postal Service is also playing an expanded role in sustaining democracy. In the new world of social distancing, mail-in and absentee voting are crucial to ensuring that Americans do not have to risk their lives to cast their votes. If the Postal Service collapses, it will take with it the infrastructure needed for millions of Americans to participate in the most fundamental act of self-government.
Now layer onto this the millions of census forms delivered to American households through the mail last month, many of which will be filled out and returned the same way.
With all that in mind, one might expect Congress and the White House to be scrambling to throw this vital public institution a lifeline. But, unlike other essential businesses — not to mention favored industries — the Postal Service, in its distress, is facing staunch political resistance that threatens to let it sink.
Part of the problem is longstanding disagreement over the agency’s structure and mission. For years, conservatives have been pushing to privatize the service. A more recent threat arises from President Trump’s personal hostility toward the agency, stemming in part from his contention that it gives sweetheart delivery rates to Amazon, the e-commerce giant led by Jeff Bezos, whom Mr. Trump considers a political enemy. The president has accused Amazon of fleecing the Postal Service and argued that if the agency is having money troubles it should simply raise the rates it charges companies like Amazon and — poof — problem solved. “Should be charging MUCH MORE!” he was tweeting in 2017.
But the president’s own task force determined that package delivery is profitable for the agency, and others have warned that a significant increase in shipping rates could in fact drive private companies to pursue alternatives.
The mail service’s troubles did not begin with the coronavirus. For decades, the agency has suffered a decline in its core business. The volume of first-class mail has dropped from a peak of 103.6 billion pieces in 2001 to 54.9 last year. To help make up the gap, the agency has shifted aggressively into the package delivery business, contracting with private companies, including FedEx, UPS and, yes, Amazon.
On various occasions, the agency has attempted to rein in costs by closing offices or cutting service. That’s when lawmakers tend to step in, deciding that its mission is too vital to tinker with. In 2013, when the Postal Service announced that it would do away with most Saturday delivery, Congress bucked, inserting a provision into that year’s budget to block the move.
Lawmakers know that voters cherish mail service. The Postal Service consistently enjoys the top job rating of any federal agency, according to research by Gallup.
Compounding its current problems, the service is saddled with financial obligations not imposed on other enterprises, private or public. In 2006, Congress passed a bill requiring the agency to set aside around $5.5 billion per year to prepay health care benefits for future retirees. This has put the Postal Service at a competitive disadvantage. Absent this burden, the agency would have turned a profit in each of the past six years, according to a report by the Institute for Policy Studies. There have been multiple attempts by Congress to repeal this mandate.
In its most recent update on the agency, the Government Accountability Office painted a bleak picture: “U.S.P.S.’s overall financial condition is deteriorating and unsustainable. U.S.P.S. has lost $69 billion over the past 11 fiscal years — including $3.9 billion in fiscal year 2018. U.S.P.S.’s total unfunded liabilities and debt ($143 billion at the end of fiscal year 2018) have grown to double its annual revenue.”
In pandemic terms, the Postal Service has several pre-existing conditions that make it vulnerable.
Last month, lawmakers sought to include a $13 billion grant for the agency in the $2 trillion coronavirus relief law. The effort was blocked by Treasury Secretary Steven Mnuchin, who warned that it would derail negotiations. Mr. Trump had threatened to reject the bill if it included a postal bailout, according to reporting by The Washington Post. Lawmakers settled for a $10 billion loan — from the Treasury Department. Mr. Mnuchin has warned that any attempt to insert a postal bailout into the next relief package would be a non-starter.
Long term, the Postal Service will need to restructure its debt obligations, among other significant reforms. Short term, Congress must find a way to shore up the agency on behalf of millions of constituents who depend on it. Last Thursday, Ms. Brennan asked lawmakers for $89 billion in assistance. This would include $25 billion in grants to cover losses from the pandemic, $25 billion for infrastructure modernization, $14 billion in debt payments related to retirement benefits and $25 billion in unrestricted borrowing authority, according to The Times.
This request seems overly ambitious. But it at least provides a starting point for debate about how Congress can — and must — keep postal carriers on their appointed rounds. This essential institution should not be held hostage to political grudges. Now more than ever,
MORE ON THREATS TO THE POSTAL SERVICE
Dec. 4, 2018: Trump Said Amazon Was Scamming the Post Office. His Administration Disagrees.