It’s no secret how much the USPS has been struggling in recent years. With the rise of the Internet and ubiquitous email drastically cutting snail mail volumes and stamp sales revenues, coupled with a disastrous 2006 Congressional mandate forcing the agency to annually contribute huge payments into postal employees’ retirement and health benefits to fully fund it 50 years into the future, the USPS has been running annual operational deficits most of this century. Since 2006, the postal service has been handling less snail mail year after year, and it’s been losing more and more money. In 2019, the USPS handled about a third less mail than in 2006.
Postmaster General Louis DeJoy saw these annual deficits and created a 10-plan to alleviate them, though it may not be the plan that will actually alleviate deficits. In fact, DeJoy’s new plan could have several negative effects, such as longer and less reliable mail delivery times, higher mail service rates and a larger workload for existing postal workers.
DeJoy’s plan to cut service levels while raising the cost to use USPS services appears more likely to push the USPS into a death spiral. And while Donald Trump famously feuded with the Postal Service, Republicans have targeted the postal institution for privatization for a long time.
As The Washington Post’s Paul Waldman noted in an August 2020 column, the reason for this is likely that the USPS represents everything Republicans hate, and getting rid of it serves a goal they all tend to share.
If you were a highly ideological conservative, the Postal Service would be a problem. It serves every American, no matter how far-flung, with a low-cost, reliable service — and provides secure employment with good wages and benefits for a blue-collar, unionized workforce, many of them Black or members of other minority groups. Americans love it, which almost inevitably makes them feel warmer toward the government in general. Why, it’s positively socialistic!
So there’s a vision underlying these changes. It’s of a Postal Service that no longer treats all Americans equally, but charges some more than others. It charges everyone more than it does now for some services, which would be a gift to its competitors such as UPS and FedEx. It values “efficiency” over getting the mail out to every address every day. It’s less reliable, less certain, and eventually, less highly regarded.
The irony for Republican voters is that, if the Postal Service went away and private strictly-for-profit businesses filled the gap, rural small-town America—the very places that support Republicans the most—would get hit the hardest. Privatized small-town post offices wouldn’t be profitable enough to keep open. Rural small-town America would universally lose their local post offices.
Even though modern technology has reduced communication on paper, the Postal Service is still vitally important to every American, and especially rural Americans — for making payments, receiving prescription drugs, delivering packages to remote places and mailing election ballots, among other services.
Cutting staff, removing mailboxes, closing small post offices, slowing the mail and raising rates will disproportionately hurt low-income people and those who live in rural areas. The Postal Service is supposed to serve all Americans.
Here’s everything you need to know about the new USPS 10-year plan and how it will affect you.
What is Postmaster General Louis DeJoy’s 10-Year Plan?
The primary focus of DeJoy’s 10-year USPS plan is to reduce the budgetary concerns the United States Postal Service is currently facing by implementing programs and policies that alleviate them. By doing this, he hopes to achieve financial sustainability for America’s postal system.
However, the way that DeJoy is going about this could have a massive effect on both the consumer and the federal workers under his control.
He announced his plans to do this over a span of 10 years and a series of implemented policies. Some of the policies in this plan go into effect immediately once the proposal is approved; others rely on the further go-ahead from specific political figures, such as President Joe Biden.
In recent years, it’s no secret that the USPS has suffered from a decline in revenue and an increase in costs. However, much of this negative change took place only after DeJoy was initially sworn in.
What Are the Proposed Changes to the USPS?
The first part of DeJoy’s plan includes raising the prices of products and USPS services. This includes a mark-up on things like postage and mailers, first-class mailing, and sending packages through the postal service. This alone would generate $24 billion in net revenue.
Additionally, the plan delivers cost cuts in other areas, such as in purchasing replacement mail vehicles and in switching the primary delivery mode of transportation from planes to trucks. This would also then mean that the length of time it takes to receive certain types of mail would increase as well.
The most (and perhaps only) positive aspect of his plan, however, is the switch that would be made from the current USPS healthcare system to a new one.
Currently, the USPS prepays health care for its employees, which results in a massive budgetary deficit. Under this new policy, however, that would be done away with and employees would be allowed to sign up for Medicare. This alone would free up over $40 billion in costs for the USPS if it is approved.
Another proposed change by DeJoy calls for a Civil Service Retirement System adjustment. Under this adjustment, DJjoy would ask President Joe Biden for permission to examine how much should have been paid into federal CSRS pensions and refund any amounts that are over that number, issuing it back to the USPS in the form of a credit.
It is unclear, however, whether that part of the program will pass. The White House hasn’t yet signaled any congressional support in seeing such a pension back credit come to fruition, though it has indicated its hope that DeJoy will leave office soon.
What Do These Changes Mean for Your Mail?
With the current USPS system, first-class mail delivery should be reliable and take no longer than 3 days to reach its location. This standard is set and known throughout the establishment regardless of where that piece of mail may be coming from or going to.
Currently, the standard for the post offices is in delivering that first-class mail on time 96% of the time. Though, since DeJoy took office, the numbers actually being hit dropped from an average of 93% to an average of 80%.
With the proposed changes to the way the mail system would operate, however, (i.e, no air transportation) those numbers would drop drastically. In fact, DeJoy plans to completely reset those expectations so that the 96% on-time delivery standard is no longer “the standard”.
Instead, DeJoy plans to retain a 70% 3-day mail delivery for first-class postage while the remaining 30% may be delivered within up to 5 days.
There are specific milage cut-offs to this, however:
- First-class mail sent fewer than 930 miles is expected to deliver within 3 days
- First-class mail sent between 931-1,907 miles should deliver within 4 days
- Anything past 1,907 miles will be delivered in around 5 days
Additionally, the package processing times would change. Because of the budget cuts, DeJoy is trying to make regarding how the USPS processes packages, the time spent doing so would increase, meaning your packages through USPS would also start coming later.
What Do These Changes Mean for USPS Workers?
If you’re a USPS postal worker, we have some unfortunate news for you regarding this new plan.
Due to budgetary cuts and the way DeJoy’s program is laid out, a large forced USPS federal retirement is expected to take place starting in 2022, while the USPS hires around 100,000 new lower paid entry level employees and contract workers. When employees leave the Postal Service, there is a risk that institutional knowledge and experience for essential positions are lost, further impacting customer service levels.
These layoffs will mostly affect the 60,000 non-union employees that work with administrative tasks within the USPS. The reduction in these employees will be primarily driven by the Voluntary Early Retirement System or VERA. Under this system, employees would be eligible to begin their retirements immediately, should they so desire.
Conclusion
The new USPS 10-year plan being implemented by Postmaster General Louis DeJoy has some good points, but overall the plan is likely to do more harm than good.
Not only would this program further delay mail by cutting costs on transportation and almost entirely eliminating air transport, but it would also close rural post offices and result in higher prices for postage which could drive more people away from using the USPS.
Additionally, the plan will result in a reduction in the nearly 60,000 experienced administrative employees within the organization through the VERA retirement system.
There are ways to solve the problems plaguing the USPS. For starters, Congress could pass the Postal Service Reform Act tho eliminate the disastrous requirement that the agency prepay its retirees’ health benefits 50 years in advance. That change would allow the agency to diversify its pension investments, as is done in most advanced countries, and would do a lot to fix its financial problems.
Other suggestions include taking advantage of the Postal Service’s presence throughout the country, in otherwise isolated or depressed areas. Possibilities include using the Postal Service to process hunting and fishing licenses, register voters, help census workers and do contact tracing for health agencies.
One promising idea is reviving the postal banking system, being tried as a pilot program in four cities. That would bring in revenue while helping disadvantaged people who have little or no access to banks and often pay exorbitant fees for basic services such as check cashing.
What’s clear is that there are solutions to embrace, should Congressional Republicans stop blocking legislation needed to reform the USPS, and should President Biden take action to replace members of the USPS Board of Governors who support Postmaster General Louis DeJoy's ill-advised 10-year plan. The postal service has been and should remain a vital part of America.
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