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Putting a pricetag on Postal Service woes

By Ed O'Keefe

Loyal Federal Eye readers and close observers of the U.S. Postal Service flagged an exchange from last week's House hearing about the mail agency that is worth highlighting here.

Though the Postal Service estimates it could lose $238 billion in the next decade, it's a worst-case scenario estimate based on assumptions that fewer postal workers than anticipated will retire, that Congress won't take any action and that the agency won't institute $123 billion worth of planned cuts.

Under questioning by Rep. Gerald E. Connolly (D-Va.), Postmaster General John E. Potter admitted last Thursday that the figure "is a theoretical number" (see video of the exchange above).

Connolly called the $238 billion figure "hard to believe," adding later, "It looks, frankly, a little bit like a scare tactic to get us to make some decisions that may or may not be popular."

Well duh, Mr. Connolly, this is Washington, where "the sky is falling" estimates are made all the time.

Potter wants Congress to lift restrictions that currently prohibit him from ending Saturday mail deliveries, closing post offices and raising postage rates above the rate of inflation. The proposals were endorsed last week by government auditors.

Still -- as debate about the Postal Service's future continues, let's remember that it's unlikely the Postal Service will lose $238 billion.

Leave your thoughts in the comments section below

By Ed O'Keefe  | April 19, 2010; 3:43 PM ET
Categories:  Agencies and Departments, Congress  
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Comments

I had to pay thousands to my congressman to keep our post office off the closure list.

Posted by: blasmaic | April 19, 2010 5:00 PM | Report abuse

Connolly looks like the braying donkey he is in the picture. Why did Tom Davis retire? Why didn't Connolly's mom say "No" to his dad so many years ago or give him the Lewinsky treatment? That way we wouldn't now have to deal with the fool that resulted from the act.

Posted by: almelbe | April 19, 2010 5:44 PM | Report abuse

What the postal service needs is new leadership, which means the replacement of the Board of Governors, the replacement of the Postmaster General and a re-organization, reduction, of the HQ staff. The new board must have a commitment to increasing service not cutting out the heart of the service, what the PMG and his staff is now doing. The next step is review and reduction in the area offices, more reduction in VP positions. We will need to raise rates, these rate increases need to be tailored to raise income from the bulk mailers, the ones that mail 90% of what goes through our plants and delivery units. We needed to entice UPS and FedEx to let us become there last mile of delivery and this should include Saturday and Sunday delivery with no surcharges, same standard rate, we have the facilities, vehicles and employees lets put them to good use.

Posted by: lostmechanic | April 19, 2010 6:34 PM | Report abuse

Don't let the first resort be the things that hit the public, such as post office closures, increase in stamp prices, and Saturday delivery. Increase advertising mail and periodical rates. Lobby Congress for USPS pension reform. Little things like those.

Posted by: Nemo24601 | April 19, 2010 6:59 PM | Report abuse

when private business has financial problems, the last thing they cut are customer-facing services. otherwise you enter the death spiral as sales continue to decline. When govt. entity faces financial difficulties, the FIRST thing they cut are customer-facing services. This way they simultaneously protect their union worker base, and get the media and congress involved to look at increasing their subsidies.

Prepare yourselves for decades of this kind of cut-the-Saturday-delivery "quandary" playing out in our health care from now on . . . .

Posted by: freebird1836 | April 20, 2010 11:20 AM | Report abuse

Does anyone know the difference between a GOVERNMENT SERVICE and a business? The USPS is a government service. Is it a good one? You decide. Is it a good deal to mail a letter anywhere in the country for 44 cents? You decide. Do we have to have the cheapest (or at least ONE OF THE CHEAPEST) prices for delivering a single letter? You decide.

Does the FAA make money? Does the DOJ make money? Does the Treasury Dept make money? Does Immigration make money? THESE ARE GOVERNMENT SERVICES....things we deem necessary to make our country work well, to keep it viable on multiple levels.

THE IRS IS THE ONLY GOVT ENTITY THAT MAKES MONEY. Immigration used to pay its own way and might be doing that still due to increased fees for services. It costs a lot more to become a citizen, or get any other immigration benefit, than it used to cost. CAN ANYONE SAY AND BELIEVE IN 50 CENTS FOR A DELIVERED LETTER? I think that will take care of the "horrible postal deficit." If it won't, then 60 cents per letter will do the job. GET IT? This fiscal saving action cannot and should/will not be borne on the backs of postal workers. GOT THAT?

Posted by: fourklines | April 20, 2010 2:39 PM | Report abuse

If Congress would do two things, the Postal Service would become solvant IMMEDIATELY! Stop the prepayment of retiree health benefits and require ALL Government agencies to use USPS for their expedited services instead of using FedEx and UPS!! I haven't spoken to an agent of any government agency that uses Priority Mail or Express Mail through the Postal Service! Even our Congress people us FedEx on a daily basis! Is our government TRYING to get rid of the Postal Service?? If not, then USE IT!

Posted by: laurajayne | April 20, 2010 4:25 PM | Report abuse

I'm shocked, shocked I tell you to find out that postal management are liars. These are honorable men and women who toil under the load of their Blackberrys to serve the American people. And to think they would fudge a few numbers, I'm so disappointed!

Posted by: shmutz | April 21, 2010 12:57 AM | Report abuse

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