Top 10 Reasons to Pass Postal Reform

 

Sen. Tom Carper’s (D-DE) staff on the Homeland Security and Governmental Affairs Committee channeled David Letterman today, giving senators a top-10 list of reasons why they should prioritize the passage of the Postal Reform Act penned by Carper (above)  and colleague Tom Coburn (R-OK) once they return from their bloody midterm election battles. Unlike Letterman lists, however, this one is devoid of humor. Postal reform is no laughing matter, as direct mailers will be reminded when they read number 10. Following is an edited version of the list.

1. The Postal Service is a critical piece of our economy, but its future is threatened. For an institution that operates at the center of a $1 trillion industry and employs nearly 8 million people, collapse would cause serious harm to customers and the overall economy. The Carper-Coburn bill aims to reform and modernize the Postal Service by addressing its longstanding healthcare and pension issues, streamlining operations, and generating additional revenue. 

2. The Postal Service continues to bleed red ink. Its financial condition is dire. It has maxed out its line of credit and defaulted three times on multibillion-dollar payments to the U.S. Treasury. The Carper-Coburn bill…enables the Postal Service to return to profitability, repay the $15 billion it owes to the U.S. Treasury, and largely eliminate its $45 billion liability for retiree healthcare. 

3. The Postal Service has been forced to make cuts to costs and services. Its workforce has been reduced through attrition from 788,000 to 491,000 since 2000. Nearly 300 mail processing facilities have been closed since 2006, cutting their number in half. Nearly 16,000 post offices have had their operating hours cut.

4. Moratoriums on plant and facility closings without other reforms would cost the Postal Service billions. [Plans call for] consolidating 82 mail processing facilities in 39 states. Members of Congress suggest a short-term moratorium on closures. Such a move would only delay the problem and likely force the Postal Service to make painful cuts elsewhere. The Carper-Coburn bill prohibits the Postal Service from closing or consolidating mail processing facilities for a period of two years from the date of enactment.

5. The Postal Service overpays billions into its retiree health pre-funding schedule. The bill allows the Postal Service to only pay what it owes for its pensions, and get the money back that it overpaid into the federal systems, specifically the Federal Employees Retirement System for federal employees hired after 1984. It restructures the Postal Service’s retiree health pre-funding schedule and eliminates the existing statutory schedule of payments. 

6. The Postal Service needs a more efficient healthcare system that takes full advantage of Medicare. The Postal Service pays more money into Medicare than any other employer in America, but its retirees don’t take full advantage of it. [Under reform a] new program covers all postal employees and annuitants and requires Medicare-eligible annuitants enrolled in the program to also enroll in Medicare parts A, B, and D. 

7. The Postal Service needs to be able to innovate to thrive in the 21st century. It needs freedom and flexibility to pursue opportunities and to act more like its own business. The bill…establishes a short-term Strategic Advisory Commission of outside experts and innovators to explore new business models. In addition, the legislation establishes a permanent Chief Innovation Officer to help serve as a change agent within the Postal Service. 

8. The Postal Service needs the capital to make investments. The Carper-Coburn bill frees up $30 billion so the Postal Service can make the capital investments necessary to compete in the coming years. 

9. The Postal Service must offer new competitive products to compete. The bill allows the Postal Service to offer new products not directly related to hard-copy mail and to deliver wine, beer, and liquor. The bill provides the Postal Service greater flexibility to set prices for its products, something essential for any business.

10. The Postal Service’s current rate system is conditional and creates uncertainty for businesses and customers. Under current law, the emergency rate increase that went into effect earlier this year will likely go away sometime in 2015. In addition, the Postal Service is forced to go to the Postal Regulatory Commission to seek approval for most price changes through a time-consuming process. The Carper-Coburn bill would prevent the upcoming price reduction in recognition of the continuing financial challenges the Postal Service faces and give its Board of Governors more say in pricing matters.

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