The U.S. Postal Service is a money-losing operation — about $9.2 billion per year, according to Rep. David McKinley, R-W.Va.
“We have got to find a way to stop that hemorrhaging,” McKinley said last week at the West Virginia State Association of Letter Carriers in Huntington.
McKinley said some people in Washington, D.C., want to continue rural post office consolidation and increase the costs of postage.
“That has all the earmarks of a death spiral,” he said. “If you’re going to raise the cost of postal services, people are going to use less of it. If you have people using less of it, then it’s less revenue coming in, and it defeats our purpose.”
Instead, McKinley supports postal reform that has been introduced in Congress to do away with the pre-funding of retiree health benefits and fix other important issues for postal workers and postal customers.
“Unlike any other public or private entity, under a 2006 law, the U.S. Postal Service must pre-fund retiree health benefits,” he said. “That’s almost unheard of and unprecedented that a federal agency would make someone pre-fund a retiree’s pension fund. That costs about $46 billion over 10 years.”
An organization as large as the Postal Service has inefficiencies, and those need to be addressed without harming its core mission. It also needs a sustainable business plan. The requirement that all retiree health benefits be pre-funded does not align with that. Removing that requirement would not solve all the Postal Service’s problems, but it would go a long way toward that end.
Meanwhile, there has been talk of consolidating some post offices or offering services the former Post Office offered years ago in smaller communities, such as banking. Consolidation must be approached carefully. As with schools, many communities get their identities from their post offices. The social costs of consolidation must be considered. More important is whether consolidation would benefit the people who rely on the Postal Service the most.
As for postal banking, that requires more thought. It’s an idea that comes and goes. Postal banking would allow people to make deposits and withdrawals and to pay bills at their local post office. Such a service could benefit communities that are too small for a branch bank, but there are enough negatives that the idea of postal banking has never gained sufficient traction to be implemented.
The Postal Service would need to be convinced such a service would not operate at a loss. And banks would most likely oppose the idea.
Even with competition from the private sector, the Postal Service remains a lifeline to many people and many communities — rural, urban and suburban.
At the end of the day, one principle stands out: You don’t allow an infrastructure that took 200 years to die a slow death. You do what you can to make it viable again. Technology has changed how people rely on the Postal Service, but technology changes, too.
We never know when society will go retro again and move from digital transactions to paper-based ones. The Postal Service needs to stand ready for that day.