Neither rain nor sleet nor dead of night, but the economy …

posted at 10:02 am on January 29, 2009 by Ed Morrissey

Saturday postal service could disappear in a sea of red ink at the Post Office.  The Postmaster General asked Congress to remove the mandate for deliveries six days a week in order to allow the USPS to control costs.  Otherwise, their deficit may grow from $2.6 billion in 2008 to $6 billion this year:

Massive deficits could force the post office to cut out one day of mail delivery, the postmaster general told Congress on Wednesday, in asking lawmakers to lift the requirement that the agency deliver mail six days a week. …

Faced with dwindling mail volume and rising costs, the post office was $2.8 billion in the red last year. “If current trends continue, we could experience a net loss of $6 billion or more this fiscal year,” Potter said in testimony for a Senate Homeland Security and Governmental Affairs subcommittee.

Total mail volume was 202 billion items last year, over 9 billion less than the year before, the largest single volume drop in history.

And, despite annual rate increases, Potter said 2009 could be the first year since 1946 that the actual amount of money collected by the post office declines.

Why have people shifted away from the Post Office?  Electronic communication, primarily e-mail, and electronic bill paying are probably the two biggest reasons.  FedEx and UPS have been around for decades, and the market share of parcel deliveries stabilized years ago.  People rely much less on hand-delivered mail.  Getting a handwritten letter is as quaint now as a Western Union telegram, and while the volume remains huge, it has already begun a long-term, significant downward drift.

The USPS has another problem besides the sixth delivery day requirement.  They have a separate requirement to make advance payments on retiree health benefit costs, on which they must pay over $5 billion this year.  They want Congress to relax that requirement, but that sounds like a shell game.  If they can’t pay it now, how will they make it up later?

Mail service should be considered in light of these economic issues.  We no longer need daily contact by mail in order to understand our world, pay our bills, or inexpensively remain in contact with friends and family.  Two generations ago, long distance telephone calls were expensive, and e-mail wasn’t even a dream.  Now many plans offer free, unlimited long-distance service and most people have access to inexpensive Internet service through work or home.

That doesn’t mean we don’t need postal service at all, but a reduction in delivery days seems reasonable.  The AP reminds us that Saturday might not be the day that gets trimmed; Tuesday is actually the lightest day on the schedule, by some analyses.  Still, the Saturday delivery should get trimmed first, as most businesses close on the weekends and the deliveries are completely unnecessary.  Any business conducted will wait until Monday anyway.  The union might not like it, as jobs and overtime will get reduced, but it makes the most business sense.

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Actually, compared to other non-military government workers, the Post Office works pretty well. The service is generally outstanding and the rates are cheap. Postal workers are the least problematic federal employees. Remember there are 1.8 million federal non-postal, non-military employees. They average over $66,000 year in salary and about an equivalent amount in benefits. So many highly paid government employees live in the DC area that Maryland is the wealthiest per capita state and 9 of the 20 richest counties are in MD and Virginia.

Whether it’s California’s state employee pensions, SIEU dickering with Blagojovich over the price of a US Senate seat, or 300,000 GS-13s making more than $80K a year, public employees are the problem, not the Post Office. Unlike most public employees, postal workers actually work and provide a service.

rokemronnie on January 29, 2009 at 3:35 PM

To add to rokemronnie’s accurate assessment, remember that no industrialized nations have lower rates, even though we cover a very large geographical area. Sending a letter from Bangor, Maine to Honolulu, Hawaii is just as cheap as across town.

jgapinoy on January 29, 2009 at 3:44 PM

I hope they do make it a five-day week. As it is, a sub does my route once a week, & it almost always gets messed up.

jgapinoy on January 29, 2009 at 3:45 PM

If anyone wants to do a history lesson on the real failure of the USPS go back to the 90’s. For the first time an outsider was appointed Postmaster General – Marvin Runyon. As former head of many corps including the TVA Runyon was the first to begin automating sorting and logistics as USPS. When he took over 80% of their budget was LABOR.

He offered early retirement for the first time to cut back labor and in short order turned the largest single company in the USA around.

He then started envisioning the future and think of ways to increase revenue. One idea was to use carriers to do meter readings and other services since he had a person at every house (almost) in the USA 6 days a week.

Needless to say the Unions did not like this an in a series of BS allegations they drove him out. So in short order the USPS went from dark to light to dark again.

In my opinion they never recovered from that power struggle. Like the plight of newspapers their situation has more to do with technological pressures than it does with the slumping economy.

The USPS is a quasi Gov Agency so while they operate independently they need approval from Congress to do much of anything.

We have the best postal service in the world!

iam7545 on January 29, 2009 at 4:25 PM

Sadly, there are a great many problems with the Post Office, I have personal knowledge of this. I laugh when I hear the PMG talking about reducing costs via reduction in craft employees, but he never mentions cutting redundant and useless management positions.

The PO has been spending money like druken sailors for years now and to borrow a phrase, “The chickens have come home to roost” — they spend billions on software and sorting equipment that doesn’t work. Millions on vehicles that are obsolete and dangerous from the day they are delivered. Ruthlessly ignore suggestions for time saving procedures from experienced employees because those ideas clash with whatever new vision is in vogue at the moment.

The Postal Service is the second largest civilian employer in the nation behind WalMart. Not one single manager, not one is in management because they were promoted based on merit. Every single postmaster and manager you have ever seen, is in that position because he or she either would not or could not do craft work. They are all clerks who lost their jobs due to automation or carriers couldn’t/wouldn’t handle delivering mail or got [airquote]injured[/airquote] and had to be moved up.

This means the USPS has the largest unqualified managerial force in the nation. When you don’t have the best and brightest running your company, you are not going to get good results.

With proper action, the PO could continue six day a week service and run at a break even cost. But you won’t see that until there is an overhaul at the top.

postaldog on January 29, 2009 at 6:33 PM

I’d accept a 100% increase in the First Class rate if the Post Office would also increase the bulk mail rates by the same amount. My “real” mail gets lost in the paper spam.

I’d also like the bulk mailers to have to pay a disposal fee, per pound, which would be made available for claim by municipalities where the bulk mail is delivered, to offset disposal costs.

Finally, until the USPS can track parcels, I will use UPS or FedEx. Shame, really; for small parcels the letter carriers can do a good, economical job.

njcommuter on January 29, 2009 at 7:14 PM

Ruthlessly ignore suggestions for time saving procedures from experienced employees

Eight months ago, I submitted an idea that saves me about five minutes a day in the sorting process. If many thousands of carriers did my method every day, each saving five minutes, imagine the savings. But my idea seems to have been ignored.

jgapinoy on January 29, 2009 at 7:59 PM

Still, the Saturday delivery should get trimmed first, as most businesses close on the weekends and the deliveries are completely unnecessary.

Many people can only get to a post office on Saturdays.

jgapinoy on January 29, 2009 at 8:03 PM

If the USPS could get 75% of my mail in the right box, they could cut it to 3 days a week for all I care.

As long as one of those days is Saturday, because the DMV is already only open during hours when their customers are at work.

Or allow competition, the USPS could be out of business in a year and we wouldn’t have to worry about it.

Merovign on January 29, 2009 at 11:00 PM

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