Consumer Groups Outline Wishes for Postal Reform

Thirteen individuals representing consumer and political groups endorsed six elements for postal reform in an April 5 letter to U.S. Postal Service Board of Governors chairman James C. Miller.

The principles endorsed by the groups, and their reasons for each:

· Financial transparency. Requiring greater transparency and better cost attribution will let postal management increase efficiency and let observers monitor their progress. It also would help prevent abuse of the postal service's monopoly power.

· Price stability, not flexibility. The governors are calling for increased pricing flexibility, but what the mail-using public and business community need are fewer and smaller rate increases.

· Cost control. Greater control over labor costs would be significant.

· No unfair competition in non-postal markets. The postal monopoly was granted for letter delivery and should not serve as a springboard for the USPS to enter non-postal markets and compete with private firms that offer telephone calling cards, international money transfers, electronic bill payment and other products and services. When the USPS reaches beyond its core mission of non-urgent letter delivery, it imposes a hidden cost on taxpayers.

· Consolidate facilities, cut costs. Follow the presidential commission's recommendation to create an independent panel modeled on the Pentagon's Base Realignment and Closure Commission. It would consider closing or consolidating unneeded postal processing and distribution facilities through a process that hears the concerns of communities and other interested parties.

· Fully independent audits. The governors say they should be held “fully accountable,” according to a letter they sent in February to congressional leaders. But they also want “to be responsible for the retention of auditors,” according to the letter. Greater accountability will come from auditors who are independent and not selected by the USPS itself.

“Above all, effective reform must benefit the American people, not just extend the Service's longevity,” according to a letter sent by the groups in response to the governors' letter to lawmakers. The groups' letter was circulated by the Consumer Postal Council, Arlington, VA.

It was signed by John Berthoud, National Taxpayers Union; Merrick Carey, Lexington Institute; Charles Guy, former director of the U.S. Postal Service's Office of Economics and Strategic Planning (and also with the Lexington Institute); Kevin Kearns, U.S. Business and Industry Council; Richard Lessner, American Conservative Union; Jim Martin, 60 Plus; Ken McEldowney, Consumer Action; Rick Merritt, Postal Watch; Chuck Muth, Citizen Outreach; Grover Norquist, Americans for Tax Reform; Tom Schatz, Citizens Against Government Waste; Michael Schuyler, Institute on the Economics of Taxation; and Don Soifer, Consumer Postal Council.

Miller and the other governors had written to congressional leaders to express their views on reform legislation. In that letter, the board offered six elements it thought needed to be part of congressional efforts:

· The escrow requirement for the so-called savings in payments to the Civil Service Retirement System should be removed.

· The portion of CSRS benefits for USPS employees attributable to their military service should not be borne by the postal service.

· Reform legislation should incorporate improvements regarding labor policies.

· The USPS should have more rate flexibility and authority to introduce new services, and the consumer price index would be an “acceptable, albeit very challenging, price cap on rates.”

· Any future changes in the scope of the postal monopoly should be considered within the context of the USPS' universal service mission and other social policy obligations.

· The USPS should be held fully accountable for the governance of the postal service, but the board should be granted requisite authority.

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