In nixing Saturday delivery, USPS sends a message


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Posted Online: Feb. 20, 2013, 2:49 pm
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By James Gattuso
What did you get in the mail last Saturday? If you are like most people, you got a few advertising flyers, a few mass-mailed solicitations asking for donations, others telling you can save on car insurance.

There may also have been a couple of bills, which -- if you're like a growing number of Americans -- you had already received online.

Yet when the U.S. Postal Service announced recently that it would be ending Saturday delivery of letter mail this August, an uproar ensued. Opponents, including members of Congress, expressed outrage, claiming it would cause hardships for postal customers and destroy an American tradition going back to Benjamin Franklin. (Never mind that free mail delivery outside of major cities wasn't even offered until the 20th century.)

Despite all the sound and fury, the move is a necessary one, and only one small step toward transformation necessary to allow the Postal Service to survive in today's world. The question now is whether Congress will let those necessary changes take place or block them, dooming USPS and putting American taxpayers at risk.

Under the Postal Service's plan, letter mail would be delivered only on weekdays, instead of Monday through Saturday. Package delivery would continue on a six-day-per-week basis, with post offices remaining open on Saturdays as well.

It's a common-sense change and one the Postal Service can ill-afford to put off. USPS is drowning in a tsunami of red ink. It has suffered losses for six consecutive years, losing almost $16 billion last year alone.

These are not, as some have argued, simply a temporary hiccup due to poor economic conditions or problems in pension accounting. The cause is much more fundamental: the Internet: email, online bill payment, and other services are displacing mail at a startling rate. In the last five years alone, the number of first-class letters mailed has plummeted by over a third.

The $2 billion saved by reducing Saturday service is only a fraction of the $20 billion Postal Service estimates it needs to break even. Within 15 years, the postmaster general predicted, delivery may be limited to three days per week.

Politically, however, service cuts are a hard sell. Prior efforts to end Saturday delivery hit a brick wall on Capitol Hill, as have other reforms. Legislators even inserted a ban on dropping Saturday service into the appropriations bill.

Given this, the Postal Service's decision to announce the cutback as a done deal -- rather than ask permission to make it -- is significant. It was a metaphorical finger in the eye of its congressional critics. It won't make it a lot of friends on Capitol Hill, but sends a strong message that it is serious about reform and will be moving forward with necessary changes even in the face of congressional opposition.

The Postal Service has not yet explained what it will do if Congress renews the current ban on service changes. One possibility is that it will simply decline federal funding, which totals less than $100 million, one-20th of the estimated savings.

Of course, cost-cutting is only part of the answer. It also must define a new role for itself in today's digital world. Americans are not going back to writing letters anytime soon -- the Internet is here to stay.

The Postal Service is in the same position as Kodak, Smith-Corona and many other firms whose products were made obsolete by digital technologies. Like them, the Postal Service must now develop a new business model. Whether that is package delivery, real estate or something else entirely. That, however, is a job that requires the skills of an entrepreneur, not politicians. And such entrepreneurs are rarely found in government agencies, or on Capitol Hill.

The outcome of the Postal Service's battle to survive is far from clear. Americans' shift to the Internet shows no signs of slowing down. The good news is that the Postal Service -- long a metaphor for inefficiency and mismanagement -- seems willing to make the unpopular decisions necessary to deal with the new environment. Unfortunately, the same cannot be said for Congress
James Gattuso is senior research fellow in regulatory policy at The Heritage Foundation; www.heritage.org.
















 




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  Today is Tuesday, Sept 2, the 245th day of 2014. There are 120 days left in the year.

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1889 — 125 years ago: Alderman Frank Ill, Winslow Howard and Captain J.M. Montgomery returned from Milwaukee, where they attended the national Grand Army of the Republic encampment.
1914 — 100 years ago: Three members of the Rock Island YMCA accepted positions as physical directors of other associations. Albert Cook went to Kewanee, C.D. Curtis to Canton and Willis Woods to Leavenworth, Kan.
1939 — 75 years ago: Former President Herbert Hoover appealed for national support of President F.D. Roosevelt and Congress in every effort to keep the United States out of war.
1964 — 50 years ago: The Rock Island Junior chamber pf Commerce has received answers to about 65 % of the 600 questionnaires mailed out recently in a "Community Attitude Survey" to analyze sentiments of citizens towards their city's various recreational, educational, and civic service programs.
1989 — 25 years ago: The two thunderstorms passing through the Quad Cities last night and early today left some area residents reaching for their flashlights.






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