As Postal Service grapples with red ink, users fear cuts
WASHINGTON - Imagine a nation without the Postal Service.
No more birthday cards and bills or magazines and catalogs filling the mailbox. It’s a worst-case scenario being painted for an organization that lost $8.5 billion in 2010 and seems headed deeper into the red this year.
“A lot of people would miss it,’’ says Tony Conway, a 34-year post office veteran who now heads the Alliance of Nonprofit Mailers.
The letter carrier or clerk is the face of the mail. But the $1.1 trillion private mailing industry that employs more than 8 million people in direct mail, periodicals, catalogs, financial services, charities, and other businesses related to the mail service.
Who would carry mail to the Hualapai Indian Reservation in the Grand Canyon? To islands off Maine? To rural villages in Alaska? Only the post office goes to those places and thousands of others in the United States, and all for 44 cents. And it’s older than the United States itself.
Ernest Burkes Sr. says his bills, magazines, and diabetes medication are mailed to his home in Canton, Ohio, and he frequently visits the post office down the street to send first-class mail, mostly documents for the tax service he runs.
“I don’t know what I’d do if they’d close down the post offices,’’ said Burkes, who doesn’t use rival services such as UPS or
Postmaster General Patrick Donahoe is struggling to keep his money-losing organization afloat as more and more people are ditching mail in favor of the Internet, causing the lucrative first-class mail flow to plummet.
Donahoe has a plan to turn things around, if he can get the attention of Congress and pass a series of hurdles, including union concerns.
“The Postal Service is not going out of business,’’ postal spokesman David Partenheimer said. “We will continue to deliver the mail as we have for more than 200 years. The postmaster general has developed a plan that will return the Postal Service to financial stability. We continue to do what we can on our own to achieve this plan and we need Congress to do its part.’’
He acknowledged that if Congress doesn’t act, the post office could reach a point next summer where it doesn’t have the money to keep operating.
Donahoe and his predecessor, John Potter, have warned for years of the problems and stressed that the Postal Service will be unable to make a mandated $5.5 billion payment due Sept. 30 to a fund for future medical benefits for retirees.
A 90-day delay on the payment has been suggested, but postal officials and others in the industry say a long-term solution is needed.
Donahoe has one. It includes laying off staff beyond the 110,000 cut in the past four years, closing as many as 3,700 offices, eliminating Saturday delivery and switching from the federal retirement plan to one of its own.
Cliff Guffey, president of the American Postal Workers Union, called the proposal “outrageous, illegal, and despicable.’’
A contract signed in March protects many workers from layoffs. Guffey said the attempt to change that now “is in utter disregard for the legal requirement to bargain with the APWU in good faith.’’ Other unions, including the National Association of Letter Carriers, are negotiating their contracts.
Yet Donahoe’s efforts are drawing praise from people such as Conway, the head of the nonprofit mailers, who says these are necessary steps that officials have shied away from in the past.
Several bills proposing ways to fix the agency are circulating in Congress. One, by Representative Darrell Issa, Republican of California, would impose a control board to make decisions.
When it was first introduced, the bill was perceived as “way out there,’’ Conway said. But as the postal financial problems have become more obvious, “you’re seeing people thinking maybe it isn’t that extreme.’’
Gene Del Polito, of the trade group American Association for Postal Commerce, said now that Donahoe has offered a plan, “why not give him the authority do to do what needs to be done.’’ If that fails, then a control board could be instituted, he said.