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The Postal Service has announced plans to cut back to five-day-a-week deliveries for everything except packages to stem its financial losses in a world where the Internet has dramatically altered how we communicate and pay our bills.
"Our financial condition is urgent," Postmaster General Patrick R. Donahoe declared Wednesday.
The way the Postal Service describes it, the move allows the service to change with the times in hopes of eventually operating in the black, erasing a $4 billion deficit over ten years.
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By his own estimate Patrick Klotzbach is quite possibly the largest volume postal customer in the southtowns. "I consider the post office essential to our business. I think we've purchased over $20,000 in postal services just in the past year, he says. Yet the internet retailer and reseller of books, DVDs and other items isn't too worried about the loss of Saturday mail delivery, despite operating six days a week "I think if it's necessary to preserve the essential parts of the service, I think it's a good move," he said, pausing from his computer searches in a non-nondescript storefront just outside of East Aurora. Klotzbach, who's company employs 7 and ships worldwide, estimates that he uses the post office for about 95 percent of his shipping, with FedEx or UPS and other providers providing the rest of his package delivery and shipment needs. But letters, he argues- as does the post office- just aren't always crucial anymore. "Almost invariably, all of our account statements, communications with our suppliers, all of it is done electronically. Then it's just delivery of the actual parcels," he says
The plan accentuates one of the agency's strong points: Package delivery has increased by 14 percent since 2010, officials say, while the delivery of letters and other mail has plummeted. Email has decreased the mailing of paper letters, but online purchases have increased package shipping, forcing the Postal Service to adjust to customers' new habits. James Valentine, an antiques shop owner in Toledo, tells the Associated Press he's not too concerned about the news either. "The mail isn't that important to me anymore. I don't sit around waiting for it to come. It's a sign of the times," he said, adding, "It's not like anyone writes letters anymore."
Over the past several years, the Postal Service has advocated shifting to a five-day delivery schedule for mail and packages - and it repeatedly but unsuccessfully has appealed to Congress to approve the move.
He said the maneuver by Donahoe to make the change "flouts the will of Congress, as expressed annually over the past 30 years in legislation that mandates six-day delivery."
Despite that opposition, the Postal Service clearly thinks it has a majority of the American public on its side. The service's market research indicates that nearly 7 in 10 people support the switch as a way to reduce costs, Donahoe said. He said the savings would include employee reassignment and attrition. The agency in November reported a record annual loss of $15.9 billion for the past budget year and forecast more red ink in 2013, capping a tumultuous year in which it was forced to default on the $11 billion in retiree health benefit prepayments to avert bankruptcy. The financial losses for the fiscal year ending Sept. 30 were more than triple the $5.1 billion loss in the previous year. Having reached its borrowing limit, the mail agency is operating with little cash on hand. |
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Some questions and answers about the Postal Service plan:
Q: What is the plan and when would it take effect?
A: Beginning in early August, mail would be delivered to homes and businesses only from Monday through Friday but would still be delivered to post office boxes on Saturdays.
Post offices now open on Saturdays would remain open and delivery of packages of all sizes would continue six days a week.
Q: Why has the Postal Service decided to cut back its delivery schedule?
A: Money.
The Postal Service suffered a $15.9 billion loss in the past budget year and has forecast more red ink in 2013. It says it expects to save $2 billion annually with the Saturday cutback. The Postal Service, an agency independent of government, does not receive tax money for its operations but is subject to congressional control over major aspects.
The majority of the service's red ink comes from a 2006 law forcing it to pay about $5.5 billion a year into future retiree health benefits, something no other agency does. Without that payment - $11.1 billion in a two-year installment last year - and related labor expenses, the mail agency sustained an operating loss of $2.4 billion for the past fiscal year, lower than the previous year.
The Postal Service is in the midst of a major restructuring throughout its retail, delivery and mail-processing operations. Since 2006, it has cut annual costs by about $15 billion, reduced the size of its career workforce by 193,000, or 28 percent, and consolidated more than 200 mail-processing locations, officials say.
Q: What has been the reaction to the plan?
A: It has been met with vigorous objections from farmers, the letter carriers' union and plenty of lawmakers. Reaction from other users is mixed, if not favorable.
Alaska Democratic Sen. Mark Begich called it "bad news for Alaskans and small business owners," who he said need timely delivery to rural areas.
Sen. Susan Collins, R-Maine, said she was disappointed, questioned the savings estimate and worried that the loss of Saturday service might drive customers away.
"The Postal Service is the linchpin of a $1 trillion mailing and mail-related industry that employs more than 8 million Americans in fields as diverse as direct mail, printing, catalog companies, magazine and newspaper publishing and paper manufacturing," she said. "A healthy Postal Service is not just important to postal customers but also to our national economy."
Despite that opposition, the Postal Service clearly thinks it has a majority of the American public on its side. The service's market research indicates that nearly 7 in 10 people support the switch as a way to reduce costs, Donahoe said.
Two Republican lawmakers -- Rep. Darrell Issa of California and Sen. Tom Coburn of Oklahoma- sent a letter to leaders of the House and Senate in support of the elimination of Saturday mail. It is "common-sense reform," they wrote.
Q: Can the Postal Service really make this change?
A: It thinks so. The Postal Service has advocated shifting to a five-day delivery schedule for mail and packages - and it repeatedly but unsuccessfully has appealed to Congress to approve the move.
The proposed change is based on what appears to be a legal loophole. Congress has long included a ban on five-day-only delivery in its spending bills, but because the federal government is now operating under a temporary spending measure, the Postmaster General says the agency can make the change, and wants Congress to keep the ban out of any new spending bill after the temporary measure expires March 27.
Might Congress try to block the idea?
"Let's see what happens," Donahoe said. "I can't speak for Congress."