Postal union hires former White House official

Reuters News

10/17/2011 1:38:49 PM - Reuters News

WASHINGTON (Reuters) - The largest U.S. postal union has hired a former Obama administration official who oversaw the 2009 auto manufacturers bailout as a financial advisor while the struggling U.S. Postal Service restructures.

The National Association of Letter Carriers, which represents 280,000 postal workers and is one of four unions representing USPS employees, has retained former White House advisor Ron Bloom and investment bank Lazard Group, the union said in a statement.

The Postal Service has seen mail volumes ebb as consumers send email and pay bills online. The agency is expected to announce next month a multi-billion-dollar loss for the last fiscal year.

Postal officials say they need permission from Congress to end Saturday mail delivery and renegotiate labor contracts, potentially laying off thousands of workers, in order to return to profitability.

The agency is studying more than 3,600 post offices and several hundred processing facilities for possible closure.

Bloom oversaw the restructuring of Chrysler and General Motors after the 2009 taxpayer rescues and left the White House in August. The letter carriers' decision to hire him indicates unions are stepping up the fight against restructuring moves they have argued rely too much on cutting employees.

Union president Fredric Rolando said in a statement that Lazard Group and Bloom "can provide valuable assistance to all stakeholders who share our commitment to maintaining and growing this vital national resource."

The statement did not clarify what their roles would be. A spokesman for the union could not be reached for comment.

Postal Service spokesman David Partenheimer said in an email that he could not comment on the hiring but that "we agree pursuing revenue-generating ideas is critical to return the Postal Service to profitability, just as cost cutting actions are also vital."

The Postal Service last month narrowly missed defaulting on a $5.5 billion payment to prefund retiree health benefits. Congress moved the payment's due date until mid-November but so far has shown little agreement on a broad postal overhaul.

A House of Representatives committee approved Representative Darrell Issa's postal reform bill last week but his proposals likely will face opposition from rural lawmakers and Senate Democrats.

Lawmakers voted to allow the Postal Service to designate up to 12 mail delivery holidays each year. Six months after passage of the bill, the Postal Service would be able to ask its regulators for permission to stop Saturday delivery.

(Reporting by Emily Stephenson in Washington and Cezary Podkul in New York; Editing by Bill Trott)