United States Postal Service Reform, Privatize or Become Extinct

The United States Postal Service has become an aging dinosaur which has been keep alive by Congressional mandate and low interest government loans. The agency no longer serving as primary means in which the public or businesses handling their affairs, the use of online payments, the internet and email has become a better method that is more timely and cost effective. Keeping in touch with family, friends, and associates has never been easier with the advent of FaceTime, Skype, web conferencing, as well as online photo sharing services eliminating the need for letters, and cards. Since 2001 First class letters being distributed by the USPS has dropped by 50%. Parcel packages which has been an outlet for additional revenues have dropped by 35% as competition from private carriers such as FedEx, UPS and DHL have took a bite out of revenues also.

The primary question in what does that all mean, the a short answer is of the nation’s 30,000+ post offices nearly all of them are losing money. The USPS since 2007 has lost over $50 billion dollars, in 2012 alone the USPS loss $15.9 Billion and 2013 the amount was $5.3 billion and in 2018 so far over $1.3 Billion YTD. Additionally, there is approximately $100 billion in unfunded retirement and healthcare benefits for the national’s 3rd largest employer just behind Walmart, and the United State Defense Department. The Postal service has become the shining example of government waste and inefficiency that will need to be bailed out just like the Banks were and the Auto Industry in a To-Big-To-Fail model.

There have been a number of suggested reforms that have been proposed over the years however all of them has had roadblocks and complications. One suggestion was eliminating the Saturday delivery of mail. Saturday delivery has always been a money loser for the postal service, however eliminating this has brought forth stiff resistance from Congress as constituents favor this value added service. Another suggestion was closing unprofitable offices and facilities again this would require support from Congress who views these offices as connection with voters in their home districts so they have been resistant to change. Many smaller communities might lose a sense of connection to their Federal government which the post office has serviced. A third option is the raising of fees and costs for provide services this has to be approved by the Board of Governors that oversees the service and so far there is no support for this.

There are bold solutions that have been tried in other countries that seem to have some mark of success. In 1995 in Germany’s the Deutsch Post was privatized and the use of centralized delivery lockers, and the reduction overall employment through attrition saved the Deutsch Post. There has also been experimentation with privatization in UK, by the Dutch, Belgians and Austrians. President Trump has been in general been supportive of some of these options to rein in costs and end deficits.

These solutions and proposals might be a way forward to ensure that the United States maintains a health postal system while eliminating costly deficits to taxpayers it is definitely an option to explore.