by Ralph Scharnau

“If this core civic institution is wrecked, the isolation among Americans will increase, urban neighborhoods and remote villages will experience further decay, unemployment will climb, internet content will suffer, and civic and political discourse will be curtailed.”

The Constitution empowered Congress to establish “Post Offices.”  The United States Postal Service (USPS) has provided universal postal service for more than 200 years.

The USPS employs a unionized workforce of 574,000 workers, the nation’s second largest employer after Wal-Mart.  But the $1.1 trillion mailing industry also employs 8 million people in direct mail, periodicals, catalogs, financial services, charities, and other businesses that depend on the post office.

Postal facilities are visited by more than 7 million people daily, and they handle roughly three billion pieces of mail weekly.  Postal workers come from a cross section of our society, including whites, African Americans, Asian Americans, Hispanics, veterans, women, and the poor.

In a series of green initiatives, including energy efficient vehicles and buildings, the postal system saved $5 million in 2010.  While ten years ago it took 70 employees an hour to sort 35,000 letters, today two employees process that same volume in one hour.

For decades there has been pressure to cut and privatize the Postal Service, which generally pays for itself but doesn’t return huge profits.  The USPS receives no public funding and so takes no money from taxpayers.

Today the Postal Service stands on the brink of bankruptcy.  To cut costs the Postmaster General and others propose closing up to 3700 postal offices, eliminating Saturday delivery, and laying off 120,000 workers.  These cruel tactics would guarantee massive job losses and would cause delays in mail delivery for businesses and for those in rural or remote areas.

More importantly, these measures fail to address the major reason for the USPS’s fiscal crisis.  While functioning as a self-supporting independent agency of the executive branch, its finances are tied to the federal budget because postal employees participate in federal retirement plans.  These retirement plans are the main cause of the agency’s fiscal woes.
The Postal Service was debt free at the end of its 2005 fiscal year.  Then, in 2006, Congress passed a law that required the USPS to prefund 80% of future retirees’ health benefits for the next 75 years within just 10 years.

No other federal agency or private enterprise is forced to prefund similar benefits.  The postal mandate costs the USPS $5.5 billion per year.  It accounts for 100% of the Postal Service’s $20 billion in losses over the past four years.

Another factor explains why the USPS bleeds red ink.  Two independent postal service audits reported that the USPS retirement plan has been overcharged anywhere from 50 to 75 billion dollars.

Legislation introduced in the House of Representatives would permit the USPS to apply those overcharged payments to meet its financial obligations.  This would enable the agency to fully fund its retiree health benefits and retire the debt it has accrued since 2006 as a result of the prefunding requirement.

The Postal Service would then have the $5.5 billion a year to use for running its services and improving mail delivery with digital advances.  It already maintains the world’s third largest computing network.

A default would also be averted without cutting positions, pay, and benefits and without slashing service.  Over the last four years, the Postal Service has already reduced its full-time staff by 110,000, mostly through early retirement and attrition, and reduced costs by $12 billion.

The USPS forms a vital network of service, connection, and community that provides the steadiest link between Americans and their government.  If this core civic institution is wrecked, the isolation among Americans will increase, urban neighborhoods and remote villages will experience further decay, unemployment will climb, internet content will suffer, and civic and political discourse will be curtailed.  We need our reliable, safe, and trusted Postal Service.

Ralph Scharnau teaches U. S. history at Northeast Iowa Community College, Peosta.  He holds a Ph.D. from Northern Illinois University.  His publications include articles on labor history in Iowa and Dubuque.  Scharnau, a peace and justice activist, writes monthly op-ed columns for the Dubuque Telegraph Herald.