Editorial: A Reprieve, for NowFor years, we've been hearing about what terrible shape the U.S. Postal Service is in. Rate increase after rate increase -- three in 18 months -- supports that opinion. The recession, 9/11 and anthrax scare only compounded its problems. Then, amid the doom and gloom, the Office of Personnel Management discovered that the USPS had overpaid what it needed to contribute to the Civil Service Retirement System. Postal officials chimed in and said they could hold off increasing rates until 2006 if they were allowed to lower the contributions. They just needed Congress to step in and make the necessary changes.
Knowing how long it takes Congress to agree on anything, not many people expected this to happen. Then the $900 billion mailing industry came forward and got lawmakers to listen. And, now, the unbelievable is about to become believable. Last week, the Senate unanimously passed a bill to modify the CSRS funding requirements, and a House vote is due this week. President Bush is expected to sign the legislation in the next 10 days. Before getting into the problems still facing the postal service, let's exhale and smile. No rate increases for the next three years. Marvel that. Now, postmaster general John E. Potter, who has proven that he can cut costs and work hours, needs to live up to his words and keep rates steady.
However, with that said, let's face the facts. The postal service is in dire need of reform. Let no one think that this reprieve should change anything on the agenda for the President's Commission on the Postal Service. The USPS needs a new business model, and this provides the opportunity to present a meaningful plan to Congress. Electronic bill payment and other e-mail uses continue to grow, causing First-Class mail -- which brings in the biggest profit for the postal service -- to decline more each year. Postal officials reported last week that First-Class volume dropped 1.6 percent in its second quarter, its sixth consecutive quarter of declines, and that First-Class volume could be down as much as 2 billion pieces by the end of the year.
What this does, though, is offer time -- time to get the work done without the worry of another rate hike nagging in the distance. Time for the Postal Rate Commission to approve negotiated service agreements with mailers. Time to explore phased rates more thoroughly. Time to get meaningful reform through.