Some Real Facts About the Postal Service

SOME REAL FACTS ABOUT THE POSTAL SERVICE, by Stanley F. Slupik

The U.S. Postal Service delivered 208 billion pieces of mail in fiscal year 2000, which is about half of the world’s mail. Stamp prices are among the lowest in the world. U.S. mail travels much further, and at a lower price, than in Italy, England, France, Germany, Switzerland, Japan, and almost every other country. In the last 6 years, the postal service has made a cumulative profit of $5.5 billion.

The postal service, according to the American Public, has an almost 90% favorable rating, which is much better than any other branch of government. The American Postal Worker is by far the most productive postal worker in the world.

In the last 6 years, the rate for a first class letter has increased by two cents. Meanwhile, according to the U.S. Department of Labor’s Consumer Price Index website:

1. The average price of a gallon of gas has increased from $1.13 to $1.45;

2. The average price of a loaf of bread has increased from 77 cents to $1.02;

3. The average price of a pound of ground beef has increased by 26%;

4. The average home gas heating bill has increased by 64%;

5. The average charge for physician’s services has increased by 23%;

6. The average charge for prescription drugs has increased by 21%.

Despite all of these facts, arch-conservative columnist Robert Novak, a well-known shill for the rich corporations, has written a column calling for privatization of the postal service. Faced with the above facts, one would think that perhaps we need the government to nationalize home and auto gas, and health care, rather than privatize a government agency that has kept prices in line.

But the postal service has always been a favorite target for businessmen who see an easy way to make a profit, at the expense of the American public. So Novak rants and raves about the great need to privatize the USPS.

In a desperate attempt to prove his case, Novak pulls some figures out of the sky, that are very inaccurate. In my mind, he has lost any credibility as a journalist. In addition, when a journalist’s “facts” are so off base, one tends to give less credence to his opinions.

For example, he states that since the USPS became an independent agency in 1971, that employee productivity has increased by only 11%. I don’t know where he got his figures. According to public record, and the USPS website at USPS.com, in FY 2000, the postal service delivered 139% more mail than it did in 1971, with only 23% more employees. To the layman, this computes to a productivity increase of about 50%. What private company can match a 50% increase in productivity?

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There were several other inaccurate figures Novak stated as fact. He said that the USPS “earns” $50 billion from first class mail. According to the USPS annual report at USPS.com, which was audited by Ernst & Young, that figure is $35 billion income, which was obviously not all “profit”, as Novak seemed to intimate. Novak leads one to believe that the USPS has lost $12.9 billion since 1971, whereas in reality that figure is $3.68 billion. The fact is that the postal service had existed on government subsidies since its existence in our country, and since 1971 there have been no subsidies.

He writes that “labor unions maintain a fat payroll of more than 900,000”. The fact is that labor unions represent 775,000 of the postal employees, of which 75,000 are not even career employees, and of which about 150,000 are part-time. As far as a “fat” payroll, there are no millionaires among union-represented postal employees. Bargaining unit postal employee salaries are mandated by law to be equal to private sector employees doing similar work. Currently, the USPS does not pay most of its maintenance and motor vehicle employees comparable salaries, so they often lose them to private sector employers, including rival UPS. About half of postal employees have to work the night shift and weekends, for almost all of their career. Many remain part-time employees for their entire career. Bargaining unit employee salaries and benefits total only 57% of postal service expenses.

Novak repeats the old saw that postal management is afraid to stand up to the “powerful” unions, but in the same article he quotes reports that management’s relationship with its unions is too adversarial, and always has been. From my perspective, I believe the postal service could be much more efficient if management would adopt a permanent policy of attempting to work with its employees and their elected union representatives.

The fact is that if the postal service needs to raise postage rates to survive, it should not be taken as such an outrage. Stamp prices have increased only two cents in the last 6 years. The prices of everything else during that time have increased. The postal service depends on transportation to move the mail, and when gasoline prices skyrocket, postal expenses rise as well.

What would happen if the postal service was privatized? Many of Novak’s friends would make a huge profit delivering mail in heavily populated areas. Competitors like UPS and FedEx, both of whom are among the leading contributors to the Republican Party, would be paid off for their legal bribes. And the American people would suffer greatly.

1. The cost of postage would surely increase. The postal service is run as a service and is mandated by law to break even over time, with no profit. No private company would deliver mail without trying to make a profit, and this would lead to higher prices, especially to those who can least afford it.

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1. When you change your address now, you only have to notify the postal service. If mail service was privatized, you might have to notify 50-75 different private companies. In 2000, the postal service processed 44 million address changes. 17% of Americans move every year. The postal service forwards mail to your new address at no charge. Do you really think that private firms wouldn’t charge for this extra service?

2. The security of the mails would be severely compromised. Presently, the Postal Inspection Service monitors mail processing and delivery. Private firms would not provide this type of security. In fact, it is likely that rival delivery services might sabotage delivery of their competitors. Many people do not use the internet to make purchases by credit card, because they fear the lack of security. But they send their credit card payments by mail every day without a second thought, because they know the postal service has preserved the sanctity of the mail.

Postal employees are much less likely to steal mail because they have a secure job with decent wages and benefits, and have much more to lose if they are caught stealing or tampering with the mail. This would not be the case in private firms, where employees would not have job security, and if Robert Novak had his way, would not have a union, or decent wages and benefits.

1. Rural mail delivery would be very costly or not at all. Many Americans would end up with no mail service. The private firms would make no profit, so they wouldn’t deliver, unless it was at a very high price.

2. Mail delivery in high crime areas, where there are many decent Americans without the means, or the intent, to move, would be very costly or not at all.

3. 900,000 postal workers and their families would be displaced. This would cause economic chaos in our country.

4. Mail sent from state to state, or to another country, would become very difficult to handle. All private firms would not be set up to deliver to every state and country. You’d have to search to find a company that could deliver different pieces of your mail. More chaos would result.

5. What do you think would happen when a private mail firm went out of business? What would they do with their mail? They might just dump it, or if you are lucky, there would only be a big delay in its delivery.

The postal service is perhaps the best ambassador that the federal government has. There is something special, in this day and age, about the government serving the public by bringing letters to every person in the country at their home, no matter how far away, or how lonely it may be. The postal service, by the way, is the only one of the top 10 largest firms to rank in the top 25 of those with diversity of employment.

The Founding Fathers had it right when made universal mail service to every American a function of the federal government. Privatization would guarantee that the service would not be the same for every American. Privatization is not a magic remedy to everything. If you don’t believe me, go to the nearest gas station. Has the competition ensured that gas prices have stayed low?