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Why the Postal Service’s halt to plant and P.O. closings may not mean much

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So, how big a deal is the U.S. Postal Service’s freeze on closings of post offices and mail processing plants?

Less than you might think, perhaps.

No doubt, today’s abruptly announced moratorium was made under mounting political pressure from Capitol Hill Democrats. “Cave-in” was how Reps. Darrell Issa, R-Calif., and Dennis Ross, R-Fla., described it in a news release.

But the long-term consequences for the Postal Service’s downsizing plans won’t necessarily be that pronounced. Last week, for example, a USPS spokeswoman told Federal Times that processing plant closings would start in April at the earliest. The five-month freeze would push that timeframe back only until May. As American Postal Workers Union President Cliff Guffey stressed on the union’s web site, the freeze “is a temporary reprieve.”

And by getting in the way of the Postal Service’s cost-cutting agenda, members of Congress have put themselves on the line with an implied promise to come up with a better alternative. Or, to quote from a letter signed by 20 senators last week: “We believe it is very important to give Congress the opportunity to reform the Postal Service in a way that protects universal service while ensuring its financial viability for decades to come.”

But to state the obvious (a favorite pastime here in the nation’s capital), lawmakers have already had that opportunity and thus far failed to deliver. Don’t be too hard on them: Fixing an organization that’s losing almost $100 million per week would tax the savviest turnaround artist.

For the APWU and other postal unions, the answer is to let the Postal Service tap into as much as $75 billion in purported pension fund overpayments.  Even when you discount the fact that the Government Accountability Office recently dismissed the idea that any erroneous overpayments occurred, a refund is not in the cards as long as Republicans control the House, which they will for at least another year. Short of some miraculously lucrative new business lines or Americans’ mass rediscovery of the continuing relevance of snail mail, it’s hard to imagine postal revenues rebounding any time soon.

Lawmakers may have thus put themselves in a box. If they can’t find out a way by May, they could have to concede that the Postal Service’s route—however distasteful for thousands of communities and USPS employees—is basically the only one they have.

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Comments

  1. R. Clark Says:
    December 14th, 2011 at 8:25 am

    I disagree with some of this. Congress has had years to help alleviate some Postal Service problems and has not done so. Additionally, some needed changes could have been implemented long ago, such as removing at least Saturday deliveries and rescinding the annual requirement for $5.5 billion into retiree benefit funds. Congress has created 70% of the USPSs problems and has procrastinated instead of taking needed action. The pension fund overpayment issue does need to be revisited; however, that too could have been done long ago.

  2. Harry Says:
    December 14th, 2011 at 8:43 am

    Sean, did you research any part of this story before you wrote it. Have any idea what the USPS actually plans on doing other than closing the plants and post offices? Laying off a hundred thousand employees in an election probably wont bode well for any congressman. Maybe we could see an article from that angle next time.

  3. Uh oh Says:
    December 14th, 2011 at 2:56 pm

    Harry, all of the postal unions have no layoff clauses in their contracts with USPS. Some are even limited in being relocated within 50 miles. The only way USPS can cut employees is to remove managers and employees with less than 6 years of service, and little career hiring has been done in the past 4-5 years. These employees would be the least paid worker as well. For the most part the USPS has allowed attrition to reduce employee numbers. Some have left but only by choice if they didn’t want to commute or move to their guaranteed position.

  4. D Ray Spencer Says:
    December 14th, 2011 at 4:51 pm

    What’s this article supposed to be, some kids term paper? Who does this person think he is fooling. This is no more than a copy and pasted blog/opinion. No facts, just a lot of rhetoric. Remember this, if the USPS goes down, then you sir are next.

  5. annette Says:
    December 14th, 2011 at 5:26 pm

    They are not going to refund the overpayment amount because they have already paid millions of dollars for houses that the higher archy of the post office live in. Why do you think Issa and the liken are so hot to privatize it. Because there is money to be made. If the cut up the parts that make money and hand it to their friends they will get compaign contributions. They have already spent the overpayment that is why that cannot give it back. Making the Post Office pay retirees benefits 75 years into the future was the way to bankrupt it, that was the plan in 2006 Postal Reform Act. Now all of a sudden it is an issue because the payment cannot be made. They are propping up something with that 5.5 billion extra. Some GOOD investgative reporter could probably find out what and why. But there aren’t any of those left, all they care about in dirty laundry.

  6. x_postal Says:
    December 14th, 2011 at 7:16 pm

    I can see USPS not paying in the pension for a while but never should the $70 billion be touched for Postal Managers to mess it up. Congress is merely making a bad situation worse with no promise or hope. Companies and local govts that have tapped into pension funds have a history of not paying it back. When they divorced from Federal status they lost their advantage. Unions are not gonna give an inch. Best to let USPS default and deal with the consequences. One month on closing is not gonna make a diff but cutting Saturday delivery will make a huge diff and savings. I dont see protestors coming to the USPS defense and if they did they should demand a new management team then re-organization; better yet make Chrysler and GM fork over the money to save or bring USPS out of the hole for a while.

  7. Andre Says:
    December 14th, 2011 at 7:34 pm

    There are two camps out here. Those of us who believe that the Postal Service has outlived it’s usefulness and needs to be either privatized or reinvented into a much smaller entity.

    The other camp is comprised of Postal Service career employee’s and there unions who want to keep this dinosaur operational as long as possible in it’s current form.

    The purpose of any bureaucracy is to perpetuate itself. So I can understand the latter groups interest. The former group which includes myself will argue that times have changed and we need less government run services.

  8. Jim Says:
    December 15th, 2011 at 2:02 pm

    Is it possible to save the USPS from laying off thousands of employees by shrinking management and employees taking a 20% cut in pay? I’m no financial whiz, but I have to believe 80% of a current check would still beat unemployment and a uncertain future. I’m not with the USPS but I am curious to see what a current employee thinks of this.

  9. anon Says:
    December 16th, 2011 at 10:38 pm

    Cut Jim’s pay by 20 recent & see how he likes it!!PMG is willing to throw employees under the bus yet is NOT willing to cut his own pay!!

  10. anon Says:
    December 16th, 2011 at 10:42 pm

    Only reason USPS is attached to government is so Congress can leach the revenues into the Treasury for the political leverages AND benefits for their careers!!!

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