Congress wants to reform the U.S. Postal Service, which, to be sure, is desperately in need of reform. Unfortunately, its proposed legislation features little more than accounting changes that would take some retirement and healthcare costs off USPS’s balance sheet and dump them into the General Fund. Taxpayer losses would then be hidden, and Americans would be saddled with even more debt, all while middle-class families are forced to continue subsidizing multi-billion-dollar corporations.
In terms of federal taxation and revenues, there is a great disparity between how corporations and families are treated by the government. Corporations pay taxes on their net income while families pay taxes on their gross income. That’s why over 50 percent of federal income taxes come from individuals and only 7 percent come from corporations. Cut the 36 percent of revenues from payroll taxes in half, and families account for 68 percent of all federal revenues!
Recently, the average federal tax rate for all American households was 20.8 percent. The average effective corporate tax rate? 1.8 percent. If this discrepancy weren’t shocking enough, Amazon, for example, paid merely $162 million in taxes on its $280 billion in revenues in 2019. For those without a calculator handy, that’s 0.057 percent.
American families are perfectly right to be angry when they see that Congress is about to bail out the USPS without even demanding fairer tax treatment of Amazon—a U.S.-based corporation already heavily subsidized by hardworking citizens. If only American families could rely on their elected officials on Capitol Hill—who make over $180,000 a year—to fight half as hard for them as Big Tech lobbyists do for their corporations.
It gets worse. The Biden administration is ignoring rising inflation, piling new debt on the shoulders of future generations while rolling out an eye-watering $6-trillion budget for the next fiscal year. The United States is already carrying about $28 trillion in national debt. Future numbers are downright terrifying. According to USDebtClock.org, the current debt translates into $85,144 of collective debt per citizen and $226,113 per taxpayer. You’d think these outrageous figures would lead politicians to spend a bit less. You’d be wrong.
A case study in how government manages to waste so much money is its inefficient management of USPS. According to testimony provided by USPS itself to Congress, the postal service lost $9.2 billion in 2020, $8.8 billion in 2019, and a staggering $15.9 billion in 2012. USPS’s 10-year plan for the USPS made the ludicrous claim that it required a $40-billion investment to get back $24 billion in new revenues. No private-sector business, which has to operate with a real bottom line, would make such an assertion. A government-run enterprise, however, has no qualms about openly stating its desire to spend billions of other people’s money with no repercussions.
Another problem with Congress’ proposed USPS reform is that it would create an “integrated delivery network” for special interests. The Package Coalition has been pushing for a way for USPS to mix the cost of delivering packages with regular mail. That way, corporations like Amazon get massive taxpayer subsidies because USPS delivers their packages. The Package Coalition has put millions into a lobbying effort to sneak a provision into Congress’ reform that would make package delivery a primary objective of USPS.
USPS has lost $87 billion over the last 14 years and failed to meet service standards. Yet it’s now getting behind reform that expands what it is required to do under law? That makes no sense. The American people must not stand for it.
If this “reform” passes, it will deliver nothing but debt, and future generations of Americans will get stuck with a mountain of a bill. They will have to pay off hidden costs for USPS retirees and health care liabilities while also subsidizing corporations that use under-market priced and taxpayer-subsidized package delivery. Americans need to dig in, voice their opposition, and immediately stop this bill that’s saturated with cronyism and accounting gimmicks.
Terry Schilling is the president of American Principles Project. Follow him on Twitter @Schilling1776.