Word is getting around. America is about to lose the U.S. Postal Service, which we have relied on for decades, if not centuries.

Just recently, the postmaster general announced sweeping service cuts and reductions effective May 15. Unless Congress takes action, the Postal Service will end Saturday delivery, slow delivery time, close hundreds of distribution centers and thousands of local post offices, and eliminate more than 100,000 jobs.

People are getting nervous. Maybe we don’t use the postal service in the same ways we used to, but we still depend on it.

Postal Service management is sensitive to the public’s unease. In a March 10 Maine Compass, Deborah Essler, USPS district manager for Northern New England, justified the cutbacks by the revenue losses caused primarily by the public’s embrace of electronic media — “e-diversion,” as it’s come to be known.

Essler assured readers that the “realignment” of operations “will put the Postal Service on a strong financial footing for decades to come.”

Essentially, the same opinion piece signed by respective USPS district managers appeared at the same time in newspapers around the country.


The points raised in Essler’s piece deserve close examination. Yes, volume of mail has declined since 2006. A first question is how much of the falloff is due to the recession, as with, say, cutbacks in direct-mail advertising?

Certainly e-diversion accounts for much of the decline, but the Postal Service has survived similarly profound technological advances throughout its history. A vital consideration — particularly in Maine — is that high-speed Internet is not available to everyone, whereas by law and tradition the Postal Service is committed to serving every address in the country.

The huge losses Essler reports and foresees for the Postal Service should not be taken at face value. By operating measures, the USPS posted a profit of $200 million for the first quarter of its current fiscal year. On paper, however, it lost $3.3 billion in that quarter. The biggest chunk of this “loss” — $3.1 billion — was payment into a fund for postal retiree health care benefits over the next 75 years, “prefunding” mandated by Congress in 2006.

Passed on a voice vote by a lame duck Republican-led Congress, the Postal Accountability and Enhancement Act of 2006 requires the Postal Service to prefund retirement healthcare benefits 75 years into the future with payments averaging $5.5 billion per year from 2007 to 2016. The bill also restricts the Postal Service’s ability to raise postage rates and — remarkable in the face of e-diversion — to provide “nonpostal services.”

The reasoning behind this legislation is still not apparent. If the USPS were losing money in 2006 — by congressional criteria it was a cash cow — providing for retiree healthcare far down the road would hardly answer the problem. No institution, public or private, has ever had to meet such an enormous prefunding obligation.

This mandate did not correct a deficiency. Future liabilities already were well under control. USPS retiree health care liabilities currently are funded at $44 billion.


The Postal Service’s Inspector General, charged with impartial oversight of USPS operations, recently confirmed that the USPS has “over $326 billion to address future liabilities, prefunding combined pension and retiree health care obligations at 91 percent.” He further noted, “The federal government does not prefund its retiree health benefits at all, and the military is funded at a 35 percent level.”

Behind the 2006 prefunding mandate lurks the specter of privatization, considered variously as suitable comeuppance for an underperforming agency or a windfall for well-positioned investors.

Some observers see the 2006 act as an attempt to debilitate the Postal Service so severely that putting it into private-sector hands would seem an act of mercy. In the Republican presidential race, heated remarks about corporate takeovers keep us mindful of the vast sums of money currently held in USPS retirement funds.

Congress created this mess, and Congress can clean it up. A starting point is the prefunding requirement that accounts for the lion’s share of USPS red ink.

Along with three colleagues, Maine’s Sen. Susan Collins has authored S. 1789, which may reach the Senate floor in the coming week. The bill offers some positive measures, but as originally drafted, it calls for scaling back prefunding by only 20 percent. Drastic service cuts would be instituted if the Postal Service is not fully profitable in two years’ time.

Vermont’s Sen. Bernie Sanders and 27 other senators support an alternative bill, S. 1853, that would end excessive prefunding while maintaining services at current levels. It also calls for rethinking the Postal Service’s business model to augment revenues. Maine’s senators should work to engineer legislation that truly puts the USPS on the strong financial footing Essler envisions.

John Curtis, a retired letter carrier, lives in Surry.

Only subscribers are eligible to post comments. Please subscribe or login first for digital access. Here’s why.

Use the form below to reset your password. When you've submitted your account email, we will send an email with a reset code.

filed under: