Editorial: More action needed soon on Postal Service fix
In a little more than five weeks, on May 15, the U.S. Postal Service will start closing 3,500 post offices and 200 mail-processing centers, many in Eastern Washington and North Idaho.
Many affected communities will, in effect, lose their nucleus, the last gathering place after the demise of their schools, farm implement dealers, and cafes; ZIP codes with zip.
Postal Service officials committed to a moratorium on closures in December, with the expectation Congress would take some of the actions needed to stanch annual losses that have surged to $9 billion. Postmaster General and USPS Chief Executive Officer Patrick Donahoe on March 27 reiterated to a congressional subcommittee the urgent need for legislation that will sanction the closures, permit five-day delivery, and amend earlier legislation that imposes unrealistic and unreasonable prepayments into Postal Service pension and retiree health care funds.
He also wants authority to create a Postal Service-sponsored health care plan.
That same day, the Senate set aside work on a rescue package that would have provided most of the relief the Postal Service says it needs.
Congress must act, quickly, to allow the Postal Service to continue restructuring that has eliminated about 300,000 jobs in recent years. In part, that will mean the rollback of what has been a level of service matched in few other countries. Although increases in the cost of stamps and shipping have been unceasing, postal patrons have been able to trust their letters and packages will be delivered, discovery of the stray World War II-era postcard notwithstanding.
But as FedEx and UPS ate up market share in parcel shipping, the Internet age dawned, sweeping billions of routine mailings into the ether, no stamp required. Reforms were intended to give the Postal Service more flexibility to respond, but requirements for prepayment of retiree benefits – a $5.5 billion annual hit – have only worsened the bottom line. The plan is over-funded today by $11 billion.
Donahoe says his Plan to Profitability will save more than $22 billion by 2016.
Most intriguing is his claim a new Postal Service health plan would save $1.7 billion a year, and provide better coverages. That would be a model, and population, worth studying.
Congress will decide how much freedom of action to give Donahoe. A House Republican bill would create a board to advise on cost-cutting ideas. One Senate plan would allow the Postal Service to deliver wine and beer, and perhaps get into other services where it would compete more directly with private enterprise. Yet another commission would study ways the Postal Service might survive.
Clearly, business as usual is not working. Donahoe’s plan is a bold response, but one not without consequences for rural America. Congress needs to meet him somewhere halfway, and soon.
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