Look, the USPS is run by a Board of Governors appointed by the President. That has been the case since 1987 and all of its money comes from postage and services.
Strategic planning by the BoG in the 1990's provided for design and acquisition of equipment that would reduce the number one cost; employees. It has been a rocky road since and the massive reduction in employee numbers seem to indicate that their vision and plans are working.
However, that is not the case as you can plainly see by the numbers. At first, reductions in workforce owed to automation brought about the unintended consequence of workplace violence that today, we glibly call 'Going Postal'. The quasi-government body was structured much like the U.S. military, which is an excellent model, but like the uniformed services everywhere, there is a different sense of loyalty and dedication than that of civilian counterparts. Military people understand duty, but civilians especially union-organized civilians know and care nothing for duty.
The BoG, headed by the Postmaster General, like all government bodies do not have a grip on reality for planning. They commonly, and wrongly, use estimates to paint a picture going forward and failed miserably by rejecting profitability as its guiding tool. Simply using estimates for mail volume as a measure to fund operations is flawed at the basic of levels. True, it is a good place to start, but after development of an outline or skeleton draft, the very estimates themselves must be proved valuable and accurate. I believe it is here that all government agencies fail, but it is not for the lack of example, they are just blind in that sense to the real world.
The USPS had a chance in the 1990's to take control over the fledgling Internet Electronic Mail messaging capability as a source of revenue and replacement of letter traffic and mail. As you should now judge, this was a fatal blow to the USPS. While the 'Private' service that emerged is a good thing in large part, it produces ZERO direct revenue (user fee or postage as example) and thus is a net loss as the latter moves to replace nearly all hard-copy mail. I find this especially troubling since it was under Carter in the late 1970's that the U.S. Government declared plans to move to the 'Paperless' society. You tell me, was that wise?
The USPS also rejected a proposal to move aggressively into the Small Parcel delivery. Obviously this was shot down by United Parcel Service and Federal Express lobbyists, but it once again proved fatal to the USPS revenue stream.
They have been operating in the RED since then for all years except 2004-06 when they finally reached parity and actually showed a profit. A series of Union-mandated contract awards spelled doom for USPS management as they sought larger and larger pieces of the pie, without respect to the same basic strategic planning estimates used by the BoG. In this sense, the Unions have failed their members by choosing to ride high on the hog rather than work in tandem and as the all-important check or balance to the BoG-led service.
Since motor fuel became so very cheap in the late 1990's, advertisers moved to bulk mailing which only temporarily inflated volume numbers. Sadly, no increase in bulk rates cost the USPS billions in what should have been a no-brainer; raise the rates.
Now, as motor fuels have become so costly and other factors which have curtailed even bulk rate advertisement, mailpiece volume has decreased so much that the USPS is losing money hand over fist. This coupled with the mandate rising out of the 2006 contract, during which funding requirements going forward provided cash in trust to cover employee pension and benefits was invoked to make good use the increase in revenue stemming from the increase in postage that year.
Yes, George W. Bush was the one to do it. I gather that the USPS thought the increase in postage was to hedge their bets against certain expenses owed to various related decisions in the courts, but I also believe they dusted off the pi$$ poor planning estimates and had visions of sugar plums dancing in their heads.
Recently, the various USPS-related Unions have been petitioning members of Congress, as they must agree to Charter Service Changes, to eliminate this trust and let the funds be counted normally as operating revenue. I believe you will find this to be yet another fatal error since the result would provide for USPS operations for about a year and then the 'normal' loss PLUS the entire cost of pensions and benefits will become red ink for the taxpaying public.
Of course further, we could always just bond and borrow operating expenses until the USPS dies a natural death, lack of usership to the point where any Post Office will become an arena in which the various Union Carriers and Handlers will be holding arm-wrestling contests on a weekly basis to determine which among them will hold and deliver the letter of the week.
Strategic planning by the BoG in the 1990's provided for design and acquisition of equipment that would reduce the number one cost; employees. It has been a rocky road since and the massive reduction in employee numbers seem to indicate that their vision and plans are working.
However, that is not the case as you can plainly see by the numbers. At first, reductions in workforce owed to automation brought about the unintended consequence of workplace violence that today, we glibly call 'Going Postal'. The quasi-government body was structured much like the U.S. military, which is an excellent model, but like the uniformed services everywhere, there is a different sense of loyalty and dedication than that of civilian counterparts. Military people understand duty, but civilians especially union-organized civilians know and care nothing for duty.
The BoG, headed by the Postmaster General, like all government bodies do not have a grip on reality for planning. They commonly, and wrongly, use estimates to paint a picture going forward and failed miserably by rejecting profitability as its guiding tool. Simply using estimates for mail volume as a measure to fund operations is flawed at the basic of levels. True, it is a good place to start, but after development of an outline or skeleton draft, the very estimates themselves must be proved valuable and accurate. I believe it is here that all government agencies fail, but it is not for the lack of example, they are just blind in that sense to the real world.
The USPS had a chance in the 1990's to take control over the fledgling Internet Electronic Mail messaging capability as a source of revenue and replacement of letter traffic and mail. As you should now judge, this was a fatal blow to the USPS. While the 'Private' service that emerged is a good thing in large part, it produces ZERO direct revenue (user fee or postage as example) and thus is a net loss as the latter moves to replace nearly all hard-copy mail. I find this especially troubling since it was under Carter in the late 1970's that the U.S. Government declared plans to move to the 'Paperless' society. You tell me, was that wise?
The USPS also rejected a proposal to move aggressively into the Small Parcel delivery. Obviously this was shot down by United Parcel Service and Federal Express lobbyists, but it once again proved fatal to the USPS revenue stream.
They have been operating in the RED since then for all years except 2004-06 when they finally reached parity and actually showed a profit. A series of Union-mandated contract awards spelled doom for USPS management as they sought larger and larger pieces of the pie, without respect to the same basic strategic planning estimates used by the BoG. In this sense, the Unions have failed their members by choosing to ride high on the hog rather than work in tandem and as the all-important check or balance to the BoG-led service.
Since motor fuel became so very cheap in the late 1990's, advertisers moved to bulk mailing which only temporarily inflated volume numbers. Sadly, no increase in bulk rates cost the USPS billions in what should have been a no-brainer; raise the rates.
Now, as motor fuels have become so costly and other factors which have curtailed even bulk rate advertisement, mailpiece volume has decreased so much that the USPS is losing money hand over fist. This coupled with the mandate rising out of the 2006 contract, during which funding requirements going forward provided cash in trust to cover employee pension and benefits was invoked to make good use the increase in revenue stemming from the increase in postage that year.
Yes, George W. Bush was the one to do it. I gather that the USPS thought the increase in postage was to hedge their bets against certain expenses owed to various related decisions in the courts, but I also believe they dusted off the pi$$ poor planning estimates and had visions of sugar plums dancing in their heads.
Recently, the various USPS-related Unions have been petitioning members of Congress, as they must agree to Charter Service Changes, to eliminate this trust and let the funds be counted normally as operating revenue. I believe you will find this to be yet another fatal error since the result would provide for USPS operations for about a year and then the 'normal' loss PLUS the entire cost of pensions and benefits will become red ink for the taxpaying public.
Of course further, we could always just bond and borrow operating expenses until the USPS dies a natural death, lack of usership to the point where any Post Office will become an arena in which the various Union Carriers and Handlers will be holding arm-wrestling contests on a weekly basis to determine which among them will hold and deliver the letter of the week.
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Kerry Lauerman
Joan Walsh
Salon.com
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