Senate Will Weigh Proposals To Save USPS After White House Submits Its Own


WASHINGTON – Homeland Security and Governmental Affairs Committee Joe Lieberman, ID-Conn., Ranking Member Susan Collins, R-Maine, and Federal Financial Management Subcommittee Chairman Tom Carper, D-Del., Tuesday praised Postmaster General Patrick Donahoe for offering a bold plan that attempts to stave off the U.S. Postal Service’s (USPS) imminent bankruptcy. But they did not endorse all of his proposals.

At a hearing entitled “U.S. Postal Service in Crisis: Proposals to Prevent a Postal Shutdown,” the Senators heard testimony for and against those proposals, which include shrinking the Postal Service workforce by 220,000 and eliminating Saturday delivery service. Carper and Collins each have introduced reform legislation to keep the USPS solvent, and three bills are pending in the House.

Without a legislative resolution, the Postal Service could default on a $5.5 billion payment to a federal government retiree fund as early as next month. If no long-term changes are made, the Postal Service will run out of money by next August or September and could possibly stop delivering mail.

Lieberman said the Committee would debate legislation as soon as possible after the White House submits its own proposal.

“It’s hard to believe it has come to this,” said Lieberman. “The U.S. Postal Service is not an 18th Century relic. It is a 21st Century national asset. I have an open mind on the various proposals that have been made but the bottom line for me is that we must act quickly to prevent a Postal Service collapse and then carefully enact a bold plan to secure its future. If nothing is done, the Postal Service will run out of money and be forced to severely slash service and employees. That is the last thing our struggling economy needs and the last thing our country needs.”

Collins said: “The USPS is seeking far-reaching legislation to allow the Postal Service to establish its own health benefits program, administer its own retirement system, and lay off its employees. This is a remarkable turnabout from its previous proposals. I appreciate that the Postal Service has now proposed several ‘Big Picture’ ideas, but many details remain unclear. As we search for remedies, we must keep in mind a critical fact: The Postal Service plays an essential role in our national economy. The Postal Service has to preserve the value and service it provides to its customers while significantly cutting costs and streamlining operations. The major solution to the financial crisis should be found in tackling more significant expenses that do not drive customers away and lead to further reductions in volume.”

Carper said: “The situation facing the Postal Service is dire, but it is not hopeless. There is a way the Postal Service can get through this crisis. We need a bipartisan, bicameral consensus around the reforms necessary to restructure the Postal Service’s finances and transform its operations to reflect the uncertain future it faces. Congress and the administration must work together and focus on the areas of agreement and build a package that is humane, smart and effective, and that can prevent postal default and insolvency and set the Postal Service on track towards stability.”

A combination of business lost to the internet and the nation’s economic problems has led to a 22 percent drop in mail with a revenue loss for the USPS of more than $10 billion over the past five years. This year the Postal Service will run up an $8 billion deficit for the second year in a row.

The Postal Service also will bump up against its $15 billion credit line with the U.S. Treasury soon, which could force it to default on a $5.5 billion payment into the health care fund for its retirees scheduled for the end of this month.

Donahoe says the USPS would save $20 billion and return to solvency by 2015 if it eliminates Saturday delivery; closes approximately 3,700 post offices; shrinks its workforce by 220,000; pulls out of the federal employee health care plan and creates its own; does away with a defined benefit retirement plan for new employees, offering them instead a defined contribution plan; and requests the return of $6.9 billion in overpayments to the Federal Employee Retirement System.

So much of the nation’s progress is interwoven with Postal history. A lot of the roads we use today – like I-95 – started out as colonial-era Post Roads. As our nation pushed west before the railroads were built, the Post Office created the Pony Express to keep the nation connected with its frontiers. And the Post Office’s subsidies for air mail in the early days of aviation helped jump start the fledgling airline industry.

Through the centuries, the Postal Service not only helped stitch together the nation, moving commerce and culture coast to coast and to all points in between, it also bound together our towns and neighborhoods, with the local Post Office often serving as a center of civic life – and many still do.

In addition to Donahoe, witnesses at the hearing included John Berry, Director of the Office of Personnel Management; Phillip Herr, Director, Physical Infrastructure Issues at the Government Accountability Office; Thomas Levy, Senior Vice President and Chief Actuary at The Segal Company; Cliff Guffey, President American Postal Workers Union; Louis Atkins, President National Association of Postal Supervisors; Ellen Levine, Editorial Director, Hearst Magazines; and Tonda Rush, Director of Public Policy at the National Newspaper Association.

15 thoughts on “Senate Will Weigh Proposals To Save USPS After White House Submits Its Own

  1. The PO is an irrationally reactionary business, not forward thinking. This is the root of our problems. They just offered a VERA to us in so cal. Guess what? No one took it! No ones leaving without some incentive. Our pension is just not that good! WHY did we not switch to Hybrid vehicles 10 Yrs ago? Think how much we would have saved!! We would be in the black now if they had done that with the money they wasted on FSS machines. I’m just sayin’

  2. We all know the biggest problem with the Postal Service is labor cost. The PO needs to go to a monthly salary instead of the hourly pay. This will allow personnel to finish their routes and end tour instead of staying out on the street trying to make more hours even when the work is done. Managers/Supv should never be paid a bonus for the work that their subordinates perform. Yes, the amount of supervisors/204B’s that are in stations are to many for the job. Artlce 8 of the contract between NALC and the PO which deals with overtime should be abolished. Consider all overtime as trackable and this will do away with 80% of griveances that are filed and thsi allow us to provide better service to our customers and save money. It’s crazy to see mail that needs to go out but I can’t take it out because i’m in another zone in the same station but we’ll waiting on a PTF of TE to come from another station to deliver the mail. Thats part of the reason why the PO is in the mess iis in now. Poor management and poor business practices…..

  3. Why is the post office hiring so mant TSE workers and threatening to lay off career employees? Why does the postal service have so many managers on details? If the postal service changes our delivery standards by one day we could save a lot of money simply by processing mail during the day and saving all that night differential. It would also help with sick leave.

  4. Here’s just one example of what is wrong with the big picture in the USPS:

    Zip codes 55437/55431/55438 (all one office).

    We just eliminated 26% of carrier routes in July. We had 4 supervisors/managers. We now have added a 5th supervisor. That’s right. 74% of our number of employees in station and we need a 20% increase in supervisory ranks!!


  5. I agree with Michael. At a rate of 1 useless to 4.5 craft employees, and making 5% more than their highest paid employee, getting rid of 100k EAS before any craft employees would save money. There is no need for that high a ratio. Knock out another 50% of the useless national managers and we’d be in the black in no time, even with pre funding.

  6. Dang, Sam Drucker, there just for a moment of time, I started to feel like a citizen in the America I used to live in. Thanks!

  7. Let’s start with a VERA before we talk about lay offs and all the other changes!I also can not believe that one has not been offered to craft employees yet one was offered to management.They shed about 1500 with that maybe if they offer $25,000.00 with no penalty they can shed about 30,000 craft employees!That does not show up as unemployed on statistics and if they hire Vets to replace them then the unemployed statistic goes down and people can see some good come out of it.Congress needs to change the provision that says you can’t offer a VERA to reduce employees and hire replacements at a cheaper wage,note I said VERA not layoffs,that would be sending the wrong message.Offer a suitable package for all CSRS employees and senior FERS who are eligible and beleive me lots will leave.We all know that we are overstaffed due to the decline in mail volume so reducing employees now is the answer,but by VERAS and attrition.The health care plan is not the greatest but why not have the Govt use it as a base for a national health plan and roll them in to strengthen it,they cost should then be reduced as it will have more members!It is time to think out of the box and create jobs and health security not destroy.The peoples representatives need to start thinking about the people and stop the finger pointing and back door dealing,we are in an economic war and in order to survive we need to unite not divide or we will be no better then the countries we lifted out of the third world and brought into the second.We will be forever known as an example of decline like Egypt, Greece,Rome,All the colonial powers such as Portugal,Spain,France and the once vaunted British Empire.We are Americans and we need to start acting like we used to with creativity,ingenuity and most of for the people and by the people!

  8. Why don’t the Postal Service just offer an VERA forget the incentive. There are so many of the Postal Workers who will go. They are waiting for this, O F F E R and they will G O !!!!!

  9. It is so obvious to me that the Government is so inept on both sides of the political isle. Why do they need to kick the can down the road in order to “look into a way” to fix the Post Office? Why haven’t they been doing it already? It is not like this problem has just now appeared? It is not the Post Office that is broken….it is this administration. I say throw them all out of office! Also, I keep hearing how “if the PO was a private business, it would be bankrupt”. However, if it were a private business, Congress would not have been robbing the solvent Postal coffers to sustain medicare and social security. Neither would it force a private business pre fund retirees healthcare 15 years into the future during good economic times and then forget about it and never withdraw it when the whole worlds economy is lagging. Folks, we are living in the mecca of political stupidity and impotence. It is Congress, who, if it were a private business, would be jailed for all the misery it has lashed on the American people. I would like to buy insurance to protect me from the ravages of government.

  10. I agree with Michael Genome. They should start by taking a HARD look at the EAS line up as well as some “illegitimate” light duty people, i.e, those who can’t lift a letter but play tennis on the weekends, and start there.

    I personally recall a time when one supervisor (tour sup.) ran an entire shift. Now, I personally know of two shifts where 2, and sometimes 3, highly paid MDOs (Manager, Distribution and operations Supervisors) are supposedly running the show. Theei pay ranges from about $65k per year to $89k per year. You can find out postal employes salaries on by clicking a link on the right hand side, about mid-say down. You just have to know their names and what city/state they work in.

    Also, stop all this pre-funding crap. Find out what FedEx and UPS does and then create a good business model.

Comments are closed.