Postal Healthcare Costs: the Elephant in the Room
This wasn’t supposed to happen—but it did.
Last Wednesday, Postmaster General Jack Potter testified before a Senate subcommittee essentially begging the government to relieve the U.S. Postal Service from its obligations and threatening that without this assistance the USPS might have to eliminate a day of mail delivery in order to save a few bucks.
Wasn’t the much-vaunted Postal Accountability and Enhancement Act of 2006 (PAEA) meant to take care of all the USPS’ financial problems and make it run more efficiently, like a business is supposed to? And most of all make it less dependent on the federal government?
Despite some press reports, a close reading of the PMG’s testimony can only lead one to conclude that Potter was going hat in hand: Asking for help with the USPS’ annual $5.8 billion healthcare payment burdens and for a change in the law that would pave the way for five-day mail delivery.
Naturally, this went over like a lead balloon with the senators.
Sen. Susan Collins (R-ME), PAEA’s chief Senate sponsor, was reported as asking Potter if he had any solutions to the USPS’ problems. And Sen. Tom Coburn (R-OK) thought Potter should come up with a better business model.
Aren’t the senators being a little disingenuous after years of back-and-forth to come up with a law that could satisfy players like United Parcel Service, FedEx and the like?
The plain fact is that the postal service can’t get out of paying those tiresome healthcare obligations. That’s the law.
However, most corporations have wriggled out of them by getting employees to foot the ever-increasing bills, regardless of how much they can afford.
In his testimony Potter repeated the mantra that without the healthcare funding the USPS would be profitable and awash in cash.
I’m not so sure about that.
Hasn’t the USPS wasted a lot of money on things like sponsorships of Olympic athletes? Or “Forever” stamps, which are always good for first class letters despite rate hikes?
Doubtless there are any number of other examples.
Without getting too far off track consider that the USPS is one of the most important elements of the country’s infrastructure, not a moneymaking enterprise designed to benefit a few elites.
Can’t anyone see that this mentality has caused many of the economic problems we’re all facing now?
February 5th, 2009 at 11:11 am
First of all, I’m surprprised that you are fannning the flames of belief that the USPS depends on the federal government to remain fiscally sound. We are governed but not subsidized, remember? Second, do your homework on corporate sponsorships and the forever stamp before you use it to make the postal service appear wasteful. Visit usps.com or read the Federal Register to find out how we are really operating in todays economy. p.s. thank goodness for the healthcare law…
February 7th, 2009 at 5:58 am
The Pony Express was considered a “miracle” in its day. But 18 months later it was disbanded due to the invention of the telegraph.
With the widespread use of the Internet, the USPS should do the same. All I get is junk mail, my DMV stuff (because they refuse to let me pick it up at the DMV).
Simply put, we need to eliminate the USPS. We can start by passing “Do-Not-Mail” laws.
Robert Arkow
April 8th, 2009 at 9:45 am
Robert,
You’re kidding right? Is there some reason you read the Big Fat Marketing blog and are not a marketer? Because Multi-channel (and since I am assuming that you are not a marketer, multi-channel means using a combination of mail, cable, internet, radio - we call these “marketing channels”- to advertise or convey a message) marketing creates the highest response to an offer. Mail is often the foot in the door for these types of campaigns because it allows the recipient to open the mail at their leisure and respond via another channel when it is convenient for them…you know, like not at the supper hour when tele-marketers call most often.