Published: Tuesday, December 6, 2011
In our view / U.S. Postal Service
Give it a chance to survive
What neither snow, rain, heat nor gloom of night could slow, digital technology has.
The United States Postal Service is in deep financial trouble, its business model badly broken as mail volume plummets, overrun mostly by the ease and speed of email and other forms of electronic information delivery.
The Internet isn't the Postal Service's only problem, though. So is the oversight of an overbearing Congress.
On Monday, the Postal Service announced a consolidation plan it says will save $2.1 billion next year and ward off bankruptcy. More than half of the nation's 461 mail processing centers -- including one on Hardeson Road in Everett that handles about 1 million letters and parcels daily -- would close. Nearly 30,000 workers would lose their jobs, including about 100 here.
As a result, next-day delivery of first-class mail will become a memory. With rare exceptions, it will take two to three days to deliver a letter, bill or DVD rental -- whether across the country or across town. Monday's announcement is part of a larger plan to cut some $20 billion in costs by 2015.
Clearly, the Postal Service is struggling as the Internet makes communicating and paying bills faster and cheaper. First-class mail volume has dropped by about 20 percent over the past five years, and current volume is projected to fall another 50 percent by 2020.
But as an "independent" government agency (meaning, in part, that it must cover its own costs), the Postal Service is handcuffed in how it can respond to changing market conditions. Congress must approve most substantial changes -- the consolidation plan is one of the few steps the Postal Service could take essentially on its own. Against rapid changes in customer preferences, and hot competition from private delivery companies like Federal Express and UPS, Congress has been unwilling to let the agency do what it must to be competitive.
That would include, for starters, ending Saturday delivery and giving the Postal Service more authority over the rates it charges. Delivering letters anywhere in the country, six days a week, costs more on average than the price of a postage stamp. Yet members of Congress, fearful of angering voters, won't let that price reflect the true cost of doing business. They've also forced Saturday delivery to remain in place, and refused to give the Postal Service more flexibility regarding labor costs.
Congress should back off. If it doesn't give the Postal Service the freedom it needs to compete successfully, next-day delivery won't be the only thing to become a memory. The U.S. Mail itself may soon join it.
The United States Postal Service is in deep financial trouble, its business model badly broken as mail volume plummets, overrun mostly by the ease and speed of email and other forms of electronic information delivery.
The Internet isn't the Postal Service's only problem, though. So is the oversight of an overbearing Congress.
On Monday, the Postal Service announced a consolidation plan it says will save $2.1 billion next year and ward off bankruptcy. More than half of the nation's 461 mail processing centers -- including one on Hardeson Road in Everett that handles about 1 million letters and parcels daily -- would close. Nearly 30,000 workers would lose their jobs, including about 100 here.
As a result, next-day delivery of first-class mail will become a memory. With rare exceptions, it will take two to three days to deliver a letter, bill or DVD rental -- whether across the country or across town. Monday's announcement is part of a larger plan to cut some $20 billion in costs by 2015.
Clearly, the Postal Service is struggling as the Internet makes communicating and paying bills faster and cheaper. First-class mail volume has dropped by about 20 percent over the past five years, and current volume is projected to fall another 50 percent by 2020.
But as an "independent" government agency (meaning, in part, that it must cover its own costs), the Postal Service is handcuffed in how it can respond to changing market conditions. Congress must approve most substantial changes -- the consolidation plan is one of the few steps the Postal Service could take essentially on its own. Against rapid changes in customer preferences, and hot competition from private delivery companies like Federal Express and UPS, Congress has been unwilling to let the agency do what it must to be competitive.
That would include, for starters, ending Saturday delivery and giving the Postal Service more authority over the rates it charges. Delivering letters anywhere in the country, six days a week, costs more on average than the price of a postage stamp. Yet members of Congress, fearful of angering voters, won't let that price reflect the true cost of doing business. They've also forced Saturday delivery to remain in place, and refused to give the Postal Service more flexibility regarding labor costs.
Congress should back off. If it doesn't give the Postal Service the freedom it needs to compete successfully, next-day delivery won't be the only thing to become a memory. The U.S. Mail itself may soon join it.
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