Rep. Amodei and the GOP’s House of Cuts

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Save the USPS

by Rich Dunn, NVRDC 2nd Vice Chair 

The US Postal Service ended 2013 with a $354 million deficit, the 18th loss out of the last 21 quarters. This is entirely due to provisions in the Postal Accountability and Enhancement Act of 2006, enacted when Republicans controlled both houses of congress and the White House. This draconian law forces the USPS to pre-pay the next 75 years’ worth of retiree healthcare costs within a 10-year window.

Republicans know that no business can operate that way, but the intent of the law was not to “enhance” the Postal Service as the name suggests. The real purpose was to force it into bankruptcy so it could be privatized, as has already happened in a number of other countries. According to the radical ideology driving these policies, competiton will lead to lower prices and better service, but things haven’t been working out that way.

In parts of the EU where postal systems have been privatized, large corporations have come out the big winners while citizens and postal workers have come out the losers. The typical pattern is for post offices to close and be replaced by counters inside of private businesses. Mail is only delivered only two or three days a week in cities, not at all in rural areas.

For postal workers, privatization has led to lower wages and more part-time and contract jobs with little job security and few or no benefits. Meanwhile, corporate customers are getting their mail picked up more frequently, often at lower cost thanks to reduced labor costs and service cutbacks to the general public.

Of course, major shareholders and C-Suite executives of postal businesses can’t believe their luck.  Even as letter mail has seen declining volumes, there are still enormous profits to be made in the mail industry thanks to the shift from brick and mortar retail stores to online shopping.

In the United States, the privatization and downsizing process has actually been going on for some time. Since the Postal Reorganization Act of 1970 went into effect, the Postal Service has paid its own way and has not received one cent in taxpayer subsidies. Now more than $12 billion of the USPS’s $65 billion annual budget goes to private companies like Pitney Bowes and United Parcel Service.

Part-time workers now make up over 20 percent of the workforce and the total number of USPS employees has been reduced by a third. Meanwhile over half of the processing plants have been closed and hours at many rural post offices have been drastically reduced, sometimes to just two or three hours a day. Collection boxes have been removed from the streets, the speed and reliability of mail delivery has gone down, more customers are being forced to pick up their mail at cluster boxes and lines at post offices are longer than ever.

In the fourth quarter of 2013, the US Postal Service made an operating profit of $765 million, a very healthy margin for any business that size. But thanks to the congressionally-imposed burden of paying its pension obligations forward, something no private business has ever been required to do, the Postal Service has to take $5 billion a year off its bottom line, resulting in paper losses quarter after quarter while it funds a $50 billion escrow account. This is 100% of the reason why the Postal Service continues to show a paper loss.

Fortunately there is hope on the horizon. On February 6th the Senate Homeland Security and Government Affairs Committee approved a bi-partisan bill which would give the Postal Service more operating flexibility and lighten some of its workforce-related burdens. Not only would this bill put the Postal Service’s balance sheet on a more businesslike footing, it would also allow it to innovate in ways that would maximize its revenues while enhancing its range of services, such as selling advertising space on the 22 million stamps it sells every year or offering email, web, banking or parcel-wrapping services,

While Mark Amodei has opposed the closure of rural post offices in CD-2, he’s fine with reduced operating hours and advocates for “robust reforms to the USPS” because its paper deficits will “leave taxpayers footing the bill unless serious changes are made to the current system.” Translation: CD-2’s representative in congress is onboard with the ongoing Republican campaign to drive the USPS into oblivion. We need to get behind the efforts of Senate Democrats to rescue and revitalize our Postal Service, especially on behalf of rural communities that depend on it most.

News from Bernie

— from Sen. Bernie Sanders

Unemployment Sen. Bernie Sanders said real unemployment rose in April to 13.9 percent. That figure from the Labor Department counts workers forced into part-time jobs and those who dropped out of the labor market. “It should be a real concern to all of us,” Sanders told Thom Hartmann on WWRL-AM in New York and other stations. Among “the hardest hit groups” are young people graduating from high school or leaving college with heavy student loan debts. Sanders renewed his call for rebuilding America’s crumbling infrastructure to create millions of good paying jobs. AUDIO

White House ’16 “My choice for the next president is Bernie Sanders. He focuses on jobs, wars and corporations, which are our three main problems in this country. We need more jobs. We need to put people to work. We need to redo our infrastructure,” Steve from New York said Saturday on C-SPAN’s Washington Journal. I’m just saying that he is the man who tells the truth. He is the most truthful person that I have heard on TV or anyplace else. We need somebody who tells the truth.” VIDEO

Koch Brothers Sen. Sanders and Jim Dean, chairman of Democracy for America, penned a letter to the CEO of Tribune Company asking it not to sell any of its newspapers to Koch Industries, reported The Hill. Concerned about the Koch brothers’ “enormous economic and political power,” Sanders and Dean voiced strong opposition to any potential offer from Koch Industries. LINK

Gas Prices Vermont lawmakers are looking at whether consumers are getting gouged at the pump. The focus is on a bill to give the attorney general the ability to track price data to see if companies are manipulating the market. Dan McLean, a senior press aide for Sen. Sanders, told the House Transportation Committee that the senator’s investigation into high gas prices caused prices to drop in the Burlington area, Vermont Public Radio reported. LINK

Irene Recovery The Federal Emergency Management Agency will pay just $1.55 million of the $3.9 million Bennington spent on emergency work after Tropical Storm Irene. Members of Vermont’s congressional delegation said they would continue to seek all the support the town deserves. They welcomed FEMA’s decision 20 months after the storm to reconsider an initial refusal to pay for any of the cleanup work, the Bennington BannerRutland Herald andTimes Argus reported. LINKLINK

Older Americans Act More than 20 senators joined Sen. Sanders in asking for additional funding for programs created by the Older Americans Act of 1965. These programs include senior nutrition initiatives such as Meals on Wheels, job training services for low-income seniors and federal initiatives to protect vulnerable seniors from abuse, The (Bend, Ore.) Bulletinreported. LINK

Social Security Sen. Sanders’ proposal to strengthen Social Security by making incomes over $250,000 a year subject to the payroll tax that funds the retirement program was cited favorably by Whole Foods CEO John Mackey. The author of Conscious Capitalism was speaking at the Tucson Festival of Books during a forum at the University of Arizona broadcast by C-SPAN on Book TV. VIDEO

Postal Service California lawmakers are banding together to stop the sale of Berkeley’s historic Main Post Office, reported Berkeley Patch. It cited Sen. Sanders’ proposal to save the Postal Service from its financial troubles. LINK

Senate ’14 President Obama lacks “an understanding that he’s never going to get anywhere with Republicans” who have little incentive to deal with him because they have a shot at regaining control of the Senate in 2014, Paul Brandus argued in an essay for The Week. Although Democrats, including the independent Sanders, control the Senate this term, 21 Democratic seats are up for grabs in November of 2014. LINK

World

Israel Bombs Syria Israel has carried out an air strike targeting a shipment of missiles in Syria bound for Hezbollah guerrillas in neighboring Lebanon, an Israeli official said on Saturday. Israel had long made clear it is prepared to resort to force to prevent advanced Syrian weapons, including President Bashar al-Assad’s reputed chemical arsenal, reaching his Hezbollah allies or Islamist rebels taking part in a more than two-year-old uprising against his government,Reuters reported. LINK

National

Missing Workers A huge number of Americans remain out of the workforce, according toNational Journal. The “labor force participation rate” held steady in April at 63.3 percent—the lowest level since 1979. Demographics and retirements certainly played some role, though economists cannot agree on the extent. Altogether about 6.7 million people have stopped looking for work since late 2007, says Heidi Shierholz, an economist with the left-leaning think tank Economic Policy Institute. Roughly 3 million to 5 million of them left because they could not find jobs, economists estimate. LINK

Congress Returns Legislation to improve the nation’s water infrastructure and overhaul farm programs will dominate the Senate’s coming work period, while the House will turn its attention to prioritizing spending in case the debt limit is reached. Senators are scheduled to complete work Monday on legislation to allow states to tax more Internet sales and then turn to consideration of the Water Resources Development Act, which a senior Senate Democratic aide said is expected to take up the balance of next week, Congressional Quarterly reported. LINK

Senate Unappealing A dearth of candidates for an open Senate seat in Iowa reflects what former and current senators and those who once aspired to the office say is a sad truth: rarely has the thought of serving in the Senate seemed so unappealing. The New York Times said the Senate is so riven by partisanship and gummed up by its own arcane rules that potential candidates from Georgia to Kentucky, Iowa to Montana are loudly saying, “Thanks, but no thanks.”  LINK

Return to Sender

Saturday delivery is vital for the elderly, disabled, people in rural areas, and those who need medicine or equipment delivered to their doors.

By Fredric Rolando, President–National Association of Letter Carriers

Fredric Rolando

Rooted in the Constitution and older than the country itself, the U.S. Postal Service supports 7.5 million private-sector jobs in the mailing industry. The Postal Service is essential to the fast-growing Internet sales industry. And the USPS is navigating this struggling economy relatively well, even making an operating profit in the most recent quarter.

Yes, making a profit. When you count how much money the Postal Service earned on postage, and subtract how much it spent delivering the mail and paying related bills, the Postal Service earned a $100 million profit in the last three months of 2012. And remember, the USPS uses no taxpayer money.

So why all this talk about the Postal Service losing money? And why is Postmaster General Patrick Donahoe planning to end Saturday mail delivery?

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There’s no question the Postal Service faces big challenges. Both email and a struggling economy are dragging down mail volume. But the Postal Service’s financial problem is actually driven by Congress’s decision to “pre-fund” retiree health care costs. Beginning in 2007, the USPS has been required to pay 75 years of those costs in advance, and to do so within just ten years.

This pre-funding accounts for about 80 percent of the “losses” sustained by the Postal Service over the last six years that you’ve heard so much about. Indeed, that last quarterly profit was wiped out by a $1.4 billion pre-funding payment.

No other government agency or private company is required to pre-fund retiree healthcare. This isn’t the same thing as postal pensions, which should be, and are, pre-funded. Most businesses just pay retiree health care bills when they’re due, but the pre-funding law forces the USPS to pay these bills all at once, far in advance.

Any other company would use its available funds to modernize so it can stay healthy. The Postal Service should be taking advantage of the enormous growth in package delivery driven by Internet sales. Instead, because it must put every spare penny into pre-funding retiree healthcare, it’s stuck in crisis mode.

What’s more, the savings from dropping Saturday delivery would be much smaller than they appear. Cutting Saturday service will drive away some Monday-through-Friday customers too, such as magazine and newspaper publishers that may just switch to other delivery services for the entire week. A study by the Postal Regulatory Commission found that ending Saturday delivery would hurt the public and save significantly less than previous claims suggest.

Saturday delivery is particularly vital for the elderly, disabled, people in rural areas, and those who need medicine or equipment delivered to their doors. No other company provides universal delivery service to every address in the country, six days a week. Even private shippers such as FedEx and UPS use the U.S. Mail for up to a third of their final deliveries to customers’ doors because they can’t match the efficiency of the postal network.

Congress has required Saturday delivery by law for three decades. Instead of trying to defy Congress, Postmaster General Donahoe should urge lawmakers to fix the pre-funding problem and give the Postal Service room to adapt for the future.

Letter carriers aren’t waiting for Donahoe to figure this out. We’ll be out in full force across America on Sunday, March 24. At rallies in Mobile, Alabama, Bismarck, North Dakota, San Diego, California, and more than 100 other cities and towns, we’ll have a clear message for Congress — keep Saturday delivery, end the unnecessary pre-funding, and develop a real reform plan that gives the Postal Service the freedom to grow and innovate in the digital era.

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For more information or to find a rally near you, please visit deliveringforamerica.com.


Fredric Rolando is president of the National Association of Letter Carriers, which represents nearly 300,000 letter carriers across the country. NALC.org
Distributed via OtherWords. OtherWords.org

Give the Post Office a Break

If the Postal Service were run like Congress, postal workers would only show up on Tuesdays, Wednesdays, and Thursdays — except when they were on vacation, which would be a lot.

— by Donald Kaul

Donald Kaul

The Postal Service says it’s going to stop delivering mail on Saturdays. This won’t happen until August, but the overseers of our postal workers in Congress are already swooning.

Outrageous” is the cry rolling through the halls of the Capitol.

Can’t help it, responds Postmaster General Patrick R. Donahoe. Our postal service is hemorrhaging money, he says, and we have to cut back. Cutting Saturday delivery would save $2.7 billion a year.

I don’t know about you, but my mail consists mainly of bills, circulars, and requests for money. I can get by with five days of that instead of six.

Apparently Congress can’t. Many of our lawmakers are fuming. Senate Majority Leader Harry Reid called it “short-sighted” and a “crippling blow.”

Whoa! Am I hearing right?

Listen, if the Postal Service were run like Congress, postal workers would only show up on Tuesdays, Wednesdays, and Thursdays — except when they were on vacation, which would be a lot.

Postal workers would repeatedly go overseas on fact-finding missions and come back empty-handed. Empty-headed too, for that matter.

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They’d have to change their motto from, “Neither snow nor rain nor heat nor gloom of night stays these couriers from the swift completion of their appointed rounds,” to, “Will deliver mail for campaign contributions.”

The postal system today is under siege from the Internet. The volume of mail handled by the postal service dropped 22 percent between 2007 and 2011. People complain about the Postal Service all the time. But that’s largely because people these days complain about almost everything all the time.

My own experience with the Post Office has been excellent. The clerks at the office I frequent are polite and helpful. The mail I send gets where it’s going in a reasonable time. And my postman knows my name.

The Postal Service is a strange, hybrid creature. It’s not quite private, but not completely public either. It doesn’t get any money from Congress, but Congress gets to decide how it runs its business.

It’s saddled by our lawmakers, for example, with the obligation of setting aside $5.5 billion every year for future retirees, an obligation that no other entity, public or private, endures.

Meanwhile, we have the cheapest first class rates in the English-speaking world.

A first class stamp in Canada costs 63 cents. In the United Kingdom, it’s the equivalent of 94 cents. Here, it’s 46 cents. And we complain about that, naturally.

The Postal Service is running about a $16 billion-a-year deficit these days. It has some ideas to close the gap, beyond getting rid of the pre-funding of retirement benefits and dropping Saturday delivery. It would like to reduce door-to door service in favor of centralized neighborhood mailboxes, and run its own health care system. But it can’t do all of that without Congress’s cooperation, which seems to have gone on permanent vacation.

Sometimes I think we’d be better off if we let Congress run the mail system and let postal workers run the country.

At least they’d show up for work.


OtherWords

columnist Donald Kaul lives in Ann Arbor, Michigan. OtherWords.org