Postal Service Limping Towards Five-Day Delivery

If we still used the Pony Express to deliver mail, someone would shoot the horse to put it out of its misery.

The U.S. Postal Service is like a once proud thoroughbred now crippled with a broken leg -- or two. The Postal Service remains a venerable institution, but it has been so severely handicapped by the recession that lawmakers are beginning to seriously consider cutting a day of delivery.

That gradual -- and reluctant -- shift in attitudes was evident at a congressional hearing today where the Postal Service again made a plea for legislation that would allow it to deliver mail five days a week instead of six.

“The only way we’ll embrace it is if we have no other choice and we’re getting to that point,” said Rep. Stephen F. Lynch (D-Mass.) chairman of the House subcommittee on federal workforce, postal service and the District of Columbia.

Compare that to the words of subcommittee member Elijah E. Cummings, a Baltimore Democrat, at a subcommittee hearing just two months ago: “I would bet everything I’ve got that’s not going to happen.”

The difference is the devastating and escalating decline in Postal Service finances.
William Galligan, a USPS senior vice president, told the panel that since the last hearing the agency has posted its second quarter financial results. Compared to the same period last year, total mail volume fell almost 15 percent. Revenue is down 10.5 percent. Almost $2 billion was lost in the second quarter.

“We are projecting a loss of more than $6 billion for this fiscal year,” Galligan said.
The work of the Postal Service is massive. This year it expects to move 180 billion pieces of mail, but that’s 32 billion less than fiscal year 2007.

It’s depressing to hear yet another comparison of our current economic plight to the Depression, but a Government Accountability Office report released at the hearing says the collapse in volume is “the largest decline since the Great Depression.”
Postal officials have implemented several cost-cutting measure, including a hiring freeze, closing a few district administrative offices and reducing work hours. Unfortunately, that’s not enough to keep it from going broke.

“Even if the Postal Service is successful with all of its cost control and transformation efforts, it appears likely that without legislative relief the Postal Service will run out of cash this year and face serious financial difficulty in 2010 and beyond,” was the bad news from John Waller, director of accountability and compliance at the Postal Regulatory Commission.

The legislative relief the Postal Service wants is permission to change the way it funds retiree health care benefits and cut the sixth delivery day, likely Saturday.

By Eric Pianin  |  May 20, 2009; 4:45 PM ET
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