The U.S. Postal Service (USPS) used to be one of the best-run and most popular agencies in the American government. But under the leadership of Postmaster General Louis DeJoy, on-time delivery has plummeted, wreaking havoc on both individuals and businesses.
Now, as of October 1, 2021, he has imposed additional sweeping changes with his 10-year USPS restructuring plan that further slows mail delivery while making it much more expensive to mail letters and packages. This is supposedly meant to address a substantial operating deficit, but it could very easily lead to a death spiral, as the worse service causes customers to flee to private shippers, cutting revenue further. That may even be intentional — as John Nichols argues at The Nation, it all smells like the start of a plan for privatizing the agency entirely.
Dejoy’s 10-year plan has drawn a complaint from 20 states’ attorneys general against the Postal Regulatory Commission (PRC), which argues that the Postal Service didn’t fully vet DeJoy’s 10-year plan: “The Plan will transform virtually every aspect of the Postal Service … rework how the Postal Service transports mail and other products; overhaul its processing and logistics network; enact slower service standards for First-Class Mail and Periodicals and First-Class Packages Services; reconfigure the location of places where customers can obtain postal products and services; and adjust rates,” the attorneys general said in a joint statement.
Privatizing the USPS would seem to benefit DeJoy's business interests, as well as the investment banking interests of Ron Bloom who currently serves as Chairman of the USPS Board of Governors.
Salon reports that according to documents newly obtained by Citizens for Responsibility and Ethics in Washington (CREW) via a Freedom of Information Act, Dejoy reportedly recused himself from agency decisions that might have affected the performance of his former freight transportation company XPO Logistics. However, the postmaster general opted out of divesting from the firm altogether, opening him up to a blatant conflict of interest.
In August 2021, CNN reported that, despite his role in heading the USPS, DeJoy's stake in XPO fell between $30 million and $75 million – an apparent conflict that came as a complete "shock" to many outside experts. XPO routinely carries out contracts with both the USPS and other government agencies, like the Defense Department. During the first two months of his tenure last year, XPO signed onto at least two new contracts with the USPS.
President Biden must get rid of DeJoy and replace him with someone who can undo the damage DeJoy has wrought on the USPS. The president, however, is not allowed to directly fire the postmaster general, who serves at the pleasure of the USPS board of governors.
The supposed bipartisan nine-member board of governors oversees the USPS’s expenditures and operations and appoints the postmasters general. Six of the current governors, including the board’s chairman, Ron Bloom, are Trump appointees; Biden has appointed three.
Unless the president has cause to remove a governor, he can replace them only when their seven-year terms end or they step aside prematurely. Those rules are meant to protect the Postal Service from partisan meddling and generally make it hard for presidents to reshape it without waging political battles. Trump and former Treasury Secretary Steven Mnuchin briefly withheld federal pandemic funds from the USPS in an efort to force it to agree to greater presidential control. That move failed, but they found like-minded proxies in DeJoy and Bloom to accomplish the same end.
In the first months of his administration President Joe Biden filled three open seats on the U.S. Postal Service’s board of governors. Unfortunately, even with Biden's three appointees — Ron Stroman, a former deputy postmaster general; Amber McReynolds, the CEO of Vote at Home, an organization that promotes voting by mail; and Anton Hajjar, the former general counsel for the American Postal Workers Union — the majority of the board members, by a margin of two, support DeJoy's moves to lower USPS service levels and increase costs to mail letters and packages.
Fortunately, Pres. Biden has the opportunity to replace two conservative members of the board by the end of 2021. Board members Ron Bloom and John Barger — who side with other board members appointed by Pres. Donald Trump in supporting DeJoy — both reach the end of their appoint terms in December.
Ron A. Bloom, a conservative Wall Street Democrat, was nominated to the Postal Service Board of Governors by Pres. Trump, confirmed by the Senate and began his service Aug. 20, 2019. Bloom served the remainder of a then vacant seat seven-year term that expired Dec. 8, 2020, and is currently serving a one year holdover term. He was elected by his fellow Governors on Feb. 9, 2021, to serve as the 24th Chairman of the Board of Governors.
Bloom is a managing partner at Brookfield Asset Management (BAM), which takes a business interest in privatizing public assets. BAM embroiled in several controversies: from its treatment of low-income tenants in the middle of the COVID-19 pandemic to its extraordinary actions to save Jared Kushner from defaulting on a $1 billion plus loan on 666 Fifth Avenue, which is now the subject of Congressional inquiries.
Furthermore, Louis DeJoy recently invested $305,000 in BAM assets. The USPS said that the transactions cleared their ethics standard, but this is a clear conflict of interest, especially given that Bloom in his current role as chair of the postal board of governors is DeJoy’s supervisor.
Bloom has a history of working towards postal privatization. Bloom recently helped lead another huge investment banking firm, Lazard, during the period it helped privatize the UK Royal Mail. During the consulting contract, Lazard was also criticized for profiting from share prices it pitched low and sold high using insider information, netting an £8 million profit in hours. Furthermore, in 2011 Lazard helped issue a five-year USPS plan that recommended a “shrink to survive” plan — Bloom, then on contract with a postal union, said it was “doomed to fail”, but now he is a co-author of DeJoy’s ten-year plan that shrinks USPS even further than the 2011 plan.
Since being appointed by Trump to the Postal Board in 2019, Bloom has served as a reliable vote for both DeJoy and his agenda. Amidst the national outcry against DeJoy’s dismantling of mail-sorting machines last year, Bloom did not respond to press inquiries about his thoughts on DeJoy’s leadership. The subsequent chaos caused by DeJoy’s operational changes prompted New Jersey Congressman Bill Pascrell to call for the immediate firing of Bloom and the rest of the Board for their “silence and complicity in [a] deliberate campaign to subvert vote-by-mail elections and destroy the Post Office.”
When asked by The Atlantic earlier this year about whether DeJoy’s operational changes had affected the election, Bloom offered a factually inaccurate response that such claims were “absolute BS” and called the agency’s handling of 2020 mail-in ballots “awesome and amazing”. Bloom’s response stands in contrast with data released by his own agency, detailing that absentee ballot mail delays arising from USPS operational changes were the worst in key battleground states like Michigan and North Carolina. Despite continued public outrage over DeJoy’s leadership, Bloom has asserted that DeJoy will “have my support until he doesn’t, and I have no particular reason to believe he will lose it.”
Bloom has also proudly proclaimed his support for DeJoy’s 10-year USPS restructuring plan — which would reduce service hours, extend delivery times, eliminate extra delivery trips, and raise postage rates — by coauthoring its introduction, pitching it to key stakeholders, and defending it alongside DeJoy himself in press interviews. He has reportedly also had a quiet but crucial role crafting DeJoy's plan.
- Postal Service Chair Ron Bloom Worked at Private Equity Firm that Profited from Privatizing the Royal Mail
- Your Mail Is About to Get Slower and More Expensive — USPS Privatization is a very possible outcome as GOP appointees on the USPS Board enact their privatization playbook.
Governor John Barger’s term is also set to expire in December of this year. Alongside Bloom’s replacement, Biden can and should nominate another progressive Democrat or Independent to take Barger’s soon-to-be-open seat and ensure that the board has an anti-DeJoy majority by 2022. Replacing Barger alongside Bloom will also neuter the power of the board’s other pro-DeJoy conservative Democrat, Donald Moak, whose term expires in December 2022.
A coalition of 77 public interest groups has urged President Joe Biden not to reappoint Ron Bloom to a second term on the United States Postal Service’s board of governors. In an Oct. 8 letter to Biden, the groups urged the president not to “reward this failed leadership with a new term.”
“Instead, please take this opportunity to correct the course of the Postal Service’s future by moving expeditiously to nominate a replacement for Mr. Bloom who will be forward-looking and more representative of the postal workforce, and will not rubber-stamp the disastrous policies of Mr. DeJoy, ” the group said.
The group appeared to be formed around the Save the Post Office Coalition, which includes more than 300 organizations. Among these are Public Citizen, MoveOn, the American Civil Liberties Union and the NAACP.
The White House has not said whether the president will reappoint any of the Trump postal board members.
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