Current reform proposals would paper over postal problems

The many issues facing the USPS have not escaped the attention of Congress, which is currently considering the Postal Service Reform Act of 2021. Unfortunately, though, this misguided piece of legislation would do little to get the USPS back into the black. The financial provisions would eliminate the requirement that the USPS prepay for its employees’ retirement healthcare benefits, even though the agency is currently allowed to amortize (i.e., gradually write off) these liabilities over four decades. Without this requirement, and any real fear of going out of business, the USPS would almost certainly fail to put enough money away for its benefit guarantees. This “fairness” provision would almost certainly end with a taxpayer bailout once today’s young postal workers become tomorrow’s retirees.

But perhaps the most ill-conceived language of the bill lies in Section 202. The legislation would insert the following language into the U.S. Code: “The Postal Service shall maintain an integrated network for the delivery of market-dominant and competitive products … Delivery shall occur, to the maximum extent practicable, at least six days a week, except during weeks that include a Federal holiday.” This language would continue to make it impossible for the USPS to end Saturday delivery, which could save the agency at least $2 billion per year. Previous Postmaster Generals have openly contemplated limiting deliveries to five days a week, reasoning those operating adjustments are needed due to declining mail volumes. Lawmakers have repeatedly gotten in the way of the USPS crafting its own business model and will continue to do so if this bill is any indication.

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Congress will never take the steps necessary to allow the USPS to operate on firm financial footing. The PostalService will become another Amtrack supported by taxpayers dollars.