We at the Frontiers of Freedom Institute have been following and writing about the US Postal Service for many years. We appreciated the appointment of an outside businessman, Louis DeJoy, as Postmaster General. We were encouraged by his 2021 Delivering for America plan to put the Postal Service on a viable financial footing. We said he deserved a chance to see how it would be implemented.
We thought the plan was focused and would help the Postal Service do what it is intended to do: deliver mail and packages together to every home and business in America six days per week, rain or shine, sleet or snow, and if necessary, “in the gloom of night.” This universal delivery function is a governmental function not performed now by any private company (and won’t be in the future).
That’s what we want – the ability to send and receive mail and packages throughout the country, direct to another address affordably, and efficiently. That is the Postal Service’s core capability and uniquely defined mission.
I still send letters; and I receive lots of packages from online shopping. Some of my relatives receive medication via the Postal Service. And millions of small businesses depend on the Postal Service to ship their products – a function which will expand nearly exponentially if the effort to bring broadband to rural America actually happens. Indeed, for centuries the Postal Service has helped to bind the nation together with equal treatment for Americans living and working in rural areas.
But now, we are deeply disappointed with the Postal Service. To start, the Postal Service just announced a $9.5 billion loss in Fiscal Year 2024! That’s up significantly from the already huge $6.5 billion loss in FY 23. And it comes despite Postal Service promises to have balanced the budget by now. It’s not a revenue problem – postage rates are up over 30 percent and package rates are competitive. It’s also not a problem of high service expectations. Indeed, the Postal Service reduced its mail service levels – but still hasn’t met any of them. Mailers are paying more for less.
The problem is costs – specifically the Postal Service’s failure to control them. Instead, inexplicably, the Postal Service has been making things worse. It has converted 190,000 flexible part-time employees to permanent career unionized status at much higher compensation. It has insourced transportation displacing more efficient private companies.
The Postal Service also has embarked on a multi-billion-dollar spending spree to build a gold-plated nationwide network of midstream processing plants and logistics capabilities largely duplicative of those that already exist in the private sector. Then, in order to keep these facilities full, the Postal Service has been forcing mailers and shippers to hand over their mail and packages “upstream” rather than continuing to rely on the private sector to efficiently process and transport them close to their destination for the “final mile delivery.”
The Postal Service appears to be trying to do everything while losing sight of the one thing it must do – deliver mail and packages together to all Americans six days a week. The Postal Service has even begun disadvantaging rural Americans through higher prices and slower service. The Postal Service had already announced that it would only go to rural post offices once a day instead of twice like everyone else. Then this week they said that their new ‘performance target’ for mail would be reduced from 95 percent to 80 percent — in other words one out of every five letters will not get delivered in the 3-5 day window — further degrading rural service.
Do we really want USPS contributing to “two Americas”? Our founders saw the postal service as an important economic tool to America’s growth and a way to unite and bind the nation together as one. But if we allow the USPS to become a government agency that disunites America and promotes a “two America” view, it will fail to do what it was intended to do and become a negative impact on America’s future.
Congressional concern about the Delivering for America plan has been growing. Both the House and Senate committees responsible for the Postal Service have scheduled hearings with the Postmaster General in December and should ask the tough questions. The Postal Regulatory Commission, which oversees the Postal Service, also has raised numerous questions and is currently independently reviewing the merits of the plan. We encourage them to do so thoroughly and rigorously as well. We share the concerns and we all deserve answers.