The US Postal Service is what’s wrong with America. I should clarify: the USPS is a microcosm of many of the issues currently confronting our nation. Before we explore those issues, some background on why USPS has found itself in the headlines.
The USPS announced this week that it plans to end Saturday letter delivery. Packages will still be delivered on Saturday, and post offices will still be open. Law requires that the USPS deliver mail six days per week, but the agency is arguing that because Congress has not passed an official budget, and the federal government is operating under a stopgap budget measure called a continuing resolution, this rule is not in effect. This move appears to be an attempt to force Congress to act on postal reform, and we’ll see if it holds up.
The USPS is an independent government agency, meaning that it operates under rules set by Congress but must fund itself. The agency hasn’t turned a profit since 2006, and last year lost $15.9 billion. Congress continues to demand that the USPS put itself on firm financial footing, while refusing to accept many of the reforms the agency wants to put in place to help it find that footing.
So how are USPS’s problems America’s problem?
Retirees are at the root of the problem.
Maybe this is a little harsh on retirees, both of the Postal Service and everywhere else. But one of the major problems plaguing the USPS is that they’ve had to pay billions each year to fund their retiree health plan. This is partially Congress’s fault, because in 2006, before the financial crisis and when the Postal Service was still making money, Congress mandated that the USPS prepay into its retirement fund. These massive prepayments have continued, even as demand for mail services have shrunk. The federal government, state governments, and municipalities have all been hit hard by pension and health care costs. Social Security and Medicare are the biggest drivers of federal spending. Many states, including Rhode Island, are locked in bitter fights with public sector unions about reductions in pension benefits.
We want to cut the budget, but not the things we like, which is most of it.
There is broad public support for cutting the budget, but most government services poll highly. This is especially true for entitlement programs like Social Security and Medicare, which eat up most of the federal budget. Many members of Congress want the USPS to cut its budget and get back in the black, but not at the expense of services like Saturday mail delivery that their constituents like.
We don’t want to pay for our government.
You or someone you know probably grumbled when postage rates increased last month (unless they invested wisely in Forever Stamps). While the public has been more receptive to tax increases recently, it’s often only for top earners. Again, we like the services we get but don’t want to increase taxes to pay for them. Can you even blame Congress for being deadlocked about the budget and the debt? Probably, but just remember the mixed signals they’re getting.
We’re unsure of what government should do.
It’s easy to make the argument for why the Postal Service should be shrunk, or even privatized, in one word: email. Technology has revolutionized communications, and it seems a little foolish to maintain the same Postal Service we had even fifteen years ago. After all, pager companies went out of business; that’s capitalism, right? If we look at the government has just another business, there’s a lot it currently does that it shouldn’t.
Unlike business, government is concerned with issues of equity, justice, and underserved populations. That’s why you can mail a letter to a sleepy rural town in Kansas for the same price you can mail it to New York City: the Post Service is committed to universal service. An Esquire piece by Jesse Lichtenstein about the USPS noted that private services, like airline routes or high-speed Internet, often aren’t available in small markets or rural areas. It’s easy to dismiss these concerns under the pressure of the current harsh economic reality, but these decisions about which rights and services are the entitlement of all citizens are what defines us as a community. Maybe having a post office isn’t one of them. But this language of the social contract should be part of the conversation.