The issue of ending Saturday mail delivery is more than one of customer inconvenience. It’s actually part of the larger question of whether the U.S. Postal Service can survive.
Postmaster General and CEO Patrick Donahoe announced Feb. 6 that the Post Office plans to move to a five-day delivery week starting the week of Aug. 5. He said the end of Saturday deliveries is a necessary cut because of the Postal Service’s accumulating deficits.
Under the plan, the rest of the Postal Service’s Saturday operations will continue as normal: post offices and post office boxes will remain open, and packages will still be delivered. But regular mail won’t be delivered to home or business mailboxes.
Following the announcement, some senators questioned the legality of the move. They said the Consolidated Appropriations Act of 2012 requires maintaining six-day delivery at the same rate it occurred in 1983 and that Donahoe does not have the authority to unilaterally cancel the service.
But if Congress doesn’t give the postal service the flexibility to find ways to cut costs, the post office could go out of business altogether. In the past fiscal year alone, the Postal Service has seen financial losses of $15.9 billion.
Donahoe estimates that cutting Saturday deliveries will save the post office $2 billion annually. But Congress could easily make other changes that would save even more.
One of the most significant would be to allow the Postal Service to manage its own health care for employees. The Postal Service now is required to prefund 75 years of benefits for retirees in 10 years, which cost the agency $11.1 billion in the past year.
That model would be unheard of in the private sector. The Postal Service estimates that under the requirement, 20 cents of every dollar in revenue go to health care costs. A new system in which the Postal Service managed its own health care for employees could save an estimated $7 billion by 2016.
But remaining competitive will be difficult for the service under any circumstances.
The post office now must go head to head with private delivery services such as UPS and FedEx, which can pick and choose their territories. The Postal Service has the built-in disadvantage of having to make deliveries in remote rural areas as well as the more lucrative metropolitan areas.
The Postal Service also must compete with electronic mail and other forms of instant communication. The custom of sending handwritten letters by mail is a dying art.
But despite all that, the U.S. Postal Service remains the envy of the world. It still is remarkable that we can send a letter to just about anywhere in the nation for less than 50 cents and rest assured that it will be delivered to the right place in about three days or less.
And if the Postal Service goes under, who will serve the rural residents, many of whom don’t have broadband Internet access? It’s not likely that the private delivery services will rush in to fill the vacuum.
While losing Saturday service will be a slight inconvenience, it is a small price to pay for giving the post office a way to economize and stay in business. But Congress shouldn’t rely on cuts in services alone.
The Postal Service, while it operates semi-independently from the government with no direct taxpayer support, still is an essential public service. The nation can’t afford to let it go out of business.