The United States Postal Service — the country’s second-largest civilian employer after Wal-Mart — is on the brink of a colossal financial meltdown.
As USPS stares bankruptcy in the face, some people believe it is up the House to do what the Senate has already done and pass legislation to keep the Postal Service and its 571,566 full-time jobs intact.
We do not, and apparently neither does the Postal Service’s management.
It is not surprising that the Postal Service finds itself in this financial quagmire.
The growing popularity of e-mail and electronic bill payments has sent mail volume plummeting in the past decade. In just the past five years, the Postal Service's annual volume declined by 43 billion pieces. First Class mail declined 25 percent in the same period of time.
Faced with billion-dollar-deficits and a business model that is slowly going the way of the 8-track tape, Postal Service officials, to their credit, came up with a restructuring plan they hoped would keep them solvent.
It was a financially prudent strategy that called for the closing of up to 252 mail-processing centers — including the one in Plattsburgh — as well as 3,700 post offices — including many in small, rural communities all over the North Country; places such as Schuyler Falls, New Russia, Riparius, North Hudson, Bakers Mills, Ellenburg and Moriah Corners.
The concept is simple enough — less mail means less need for offices and employees.
The restructuring plan, which also proposed halting Saturday delivery, was supposed to save some $6.5 billion a year — and stop the financial hemorrhage.
In the last five years alone, the Postal Service has lost $25 billion and is projected to lose another $14 billion by the end of this year. It loses $25 million a day.
Only 20 percent of its offices are profitable, and its employee expenses are way out of line with those in the private sector. Wages and benefits for its 571,566 full-time employees account for 80 percent of its operating budget, compared with 61 percent of UPS's and 43 percent of FedEx's.
The average USPS employee makes $83,000 in salary and benefits annually, much more than most other federal employees.
Many post offices and branches that face closure provide very little revenue. In fact, 84 percent of the locations on the closure list take in less than $27,500 in annual revenue and have less than two hours of work a day, according to Dean Granholm, the Postal Service's delivery and operations vice president.
But, instead of allowing the Postal Service to save itself — and the taxpayer — from disaster, Washington is playing election-year politics and has proposed an $11 billion bailout that will keep the Postal Service limping along a few more years.
After that, if the Postal Service is not allowed to eliminate expenses it will need to return with its hand out again, Postmaster General Patrick Donahoe has said.
“It is totally inappropriate in these economic times to keep unneeded facilities open. There is simply not enough mail in our system today,” the Postal Service's board of governors said in a statement.
Nevertheless, the U.S. Senate passed a bailout bill in late April, with senators from both parties lining up in favor.
The bill would save Saturday delivery and rescue about half the mail processing centers the Postal Service wants to close, cutting the list from 252 to 125.
Not surprisingly, the processing centers that would survive are in states whose senators were sponsors of the postal bill — like Connecticut, Delaware, Maine, Missouri and Vermont, according to a preliminary list obtained by The Associated Press.
Therein lies the problem.
This is not about “saving an iconic American institution that still delivers 500 million pieces of mail a day,” as bill co-sponsor Sen. Joe Lieberman of Connecticut put it.
It is little more than an election-year gimmick to give senators the ability to stand at a podium in November, pounding their chests while telling voters through toothy grins that they stood against postal closures.
The bailout money is nothing more than a Band-Aid to get the Postal Service through the election cycle. Without real reform, it remains doomed to extinction.
The bill now goes to the House for consideration, with a May 15 deadline looming when postal officials have vowed to start making cuts.
Let’s hope the outcome will be a long-term plan to save America’s 200-year-old Postal Service, and not another spending binge at the expense of the American taxpayer in the interest of those seeking re-election.
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