Monday, February 25, 2013
The U.S. Postal Service is no longer the most affordable means of long-distance comunication as it was when Benjamin Franklin established it in 1775 by decree of the Continental Congress, but it nevertheless remains a relevant and important service in America.
Yet, much has changed in those 200-plus years, economically and socially, and the Postal Service finds itself on the ropes financially. It either has to make dramatic changes to its operation or cease to exist.
Postal officials are attempting to make big changes.
The Postal Service is aiming to stop Saturday mail delivery in August. Going to a five-day mail delivery schedule is expected to save $2 billion a year, which is far short of solving all the agency’s problems. The Postal Service lost $15.9 billion last year.
Under the cutback plan, only Saturday delivery would stop. The Postal Service would continue to deliver packages six days a week and post offices would still be open on Saturdays.
This decision isn’t being met with enthusiasm by postal unions and Congress. That’s hardly a surprise. Everybody likes services such as Saturday mail delivery, but paying for these services is not particularly popular.
Postal Service officials are doing what they have to for the agency’s long-term survival.
“Our financial condition is urgent,” said Patrick R. Donahoe, the postmaster general, as he announced the plan to reduce delivery. “This is too big of a cost savings for us to ignore.”
But Congress has been trying to get postal officials to ignore this option for years. Earlier attempts to cut costs have been met in Congress with objections and delays.
Lawmakers see the Postal Service as a government service that touches their constituents constantly.
That’s true to a point, but taxpayers are not fully funding the service. The U.S. Postal Service is a quasi-government agency. It has not been directly funded by taxpayers since the early 1980s when it was set up as an independent agency expected to generate enough revenue to be self-sustaining.
The quasi-government model isn’t working particularly well in part because of some mandated expenses.
In additon, the Postal Service has entering into some dubious sweetheart deals with junk mailers that don’t make financial sense.
The Postal Service has to adapt quickly to changes in the marketplace with smart businesses decisions just as the private sector must do.
Cutting Saturday delivery is a prudent financial move for the future.
It’s going to require more cash-saving moves, as well as some help from Congress through reforms and subsidies, to keep the affordable delivery available of letters and other mail for the good of the nation and its economy.