Few governmental agencies can boast a history as long the United States Postal Service, and none matches the number of personal contacts USPS racks up six days a week as carriers make their rounds throughout the country.
Millions of Americans rely on the United States Postal Service every day to send and receive essential physical goods, including prescriptions, Social Security checks, ballots and household items that cannot be transmitted electronically or otherwise.
For decades, the USPS has supported eCommerce through last-mile deliveries to every address in the country — no matter how remote — when other carriers have either refused to service these areas or offered only cost-prohibitive options.
And all of this is under threat due to inaction in Congress.
Congress has required USPS to pre-pay healthcare and retirement benefits for some time now, even as fuel and other costs associated with delivery have risen, and the volume of the most profitable services continue to decline.
As a result, USPS is more vulnerable than ever. Congress has failed to act, with expenses mounting and revenues declining even more steeply during the current novel coronavirus outbreak.
We are calling on our clients, industry leaders and ordinary citizens to contact their representatives in Congress to urge bipartisan compromise that will guarantee postal delivery services will be available in the short term, as well as for generations to come.
Selection of the new PMG, Louis DeJoy, by the Board of Governors to serve as the nation’s 75th Postmaster General, effective June 15 should help with this effort He brings extensive experience with transforming logistics and transformation delivery organizations and the most challenging aspect out of many for the USPS is the logistics cost..
Congress has blocked USPS from closing underperforming post office locations, prevented a move to a five-day-a-week delivery schedule rather than the existing six and continues to require retirement benefits to be funded decades into the future. These requirements have financially strained the Postal Service to the point of breaking.
Assurety Consulting & Solutions Inc. was invited by the Lexington institute to attend a forum on postal reform focused on USO (Universal Service Obligation) prior to the severe outbreak of COVID-19 in the United States on March 6, 2020.
The chief topic was what should be the definition of the Universal Service Obligation, and how should the definition be determined?
Attendees included Postmaster General Megan Brennan, current Inspector General Tammy Whitcomb, former Inspector General David Williams, Peter Navarro, an economic advisor to President Donald J. Trump, PostCom President Michael Plunkett, Ken Johns and John Hatton with Government Accountability Office, American Postal Workers Union President Mark Dimondstein, with Robert Shapiro, Kenneth John, Robert Taub, Anna Möller Boivie and the Lexington institute’s Paul Steidler.
Among a long list of discussion and salient points around postal reform included but limited to:
| Core mission, prompt reliable mail services | Full funding of the cost of universal service network needed |
| Must be allowed to compete in the package world | Leveraging of assets to promote the public good is the goal |
| Storefront government services | Definition, flexibility, geography and financial sustainability of USO is needed |
| Alternative funding subsidies | Americans do not value cluster box delivery, prefer home delivery |
| Pricing flexibility should be available | Other countries experience with USO can’t be linked with US due to our culture, population and geography |
| Reform is to improve, not to cut services | Private vs public service impacts at times of natural disasters and epidemics |
| Medicare integration to cut medical costs | Find savings in the middle mile |
| UPU subsidies of 500M saved | Ten % is Contraband in Chinese eCommerce today |
| GAO focus is revenue, costs and retirees’ benefits | Revenue through non-Postal Services business |
| Compensation is 1/3 of Costs | Hire None-Carrier employees |
| Collective bargaining challenges USPS cost reductions | Reform required within 2 years (this was 2 weeks before Covid reality hit us) |
| Old trucks (60%) require replacement | Know cost of every item |
| USPS broke even for 210 years | US Citizens owe $300B to USPS landed to treasury |
| Instead of USPS, we want businesses to profit, else USPS could have been profitable | Every costing should be done with data driven Postal Analytics support |
| 30,000 USPS retail stores in first mile | Concierge Services |
| Higher prices cheapen the supply chain | USA needs subsidies and package competition |
| 35% drop in volumes in the recent years | US is in USO – We need to decide what we want and then make sure USPS breaks even through subsidies, if needed |
The key areas of reform identified by forum participants included USO clarity, healthcare reform through a merger with Medicare, fully-supported retiree benefits, allowing the USPS the ability to expand into non-postal activities and increase competition with the parcel industry.
The COVID-19 outbreak exacerbated an already dire situation at USPS but has also highlighted how important regular mail delivery is in this country — whether during the throes of a pandemic, the aftermath of a hurricane, earthquake or tornado, or during ordinary times.
We don’t have two more years to debate reform — it is now time for Congress to act. USPS and the American public cannot wait any longer for Congress to prioritize funding and liquidity of USPS and guarantee its future.
You can help by reaching out to your representatives to make sure they understand the urgency of this situation and encourage them to support both short-term and long-term reform initiatives.
The USPS has a history that predates the Declaration of Independence and was considered so vital to our fledgling democracy that the framers of the US Constitution included language requiring its existence.
Our democracy — and our country — still rely on this daily government service 210 years after its official establishment in 1792. With the proper reforms, we can guarantee the next 210 years of reliable, affordable post service throughout this country.
If you are interested in continuing to help, C21 has initiated a social media campaign that sends a message to the appropriate Senators and Representatives. To reach the social media campaign portal, simply text “MAIL” to 52886 or go to https://p2a.co/bkzjTID to reach the portal to send the message. There is a message already created.
Feel free to share this information with your employees, vendors, customers, etc. The more communications that are generated, the higher the chance that Senators and Representatives may support USPS funding. Right now, though it is important to reach out to all Senators and Representatives, communications to the ones in these states are key: Alaska, Arizona, Colorado, Florida, Georgia, Iowa, Kentucky, Montana, North Carolina, and Wisconsin [Others may be added later].
