Postmaster General Announces Price Hikes, Delivery Delays at United States Postal Service
Postmaster General Louis DeJoy announced on Tuesday that the United States Postal Service will be increasing the price of postage and stretching the delivery times for First Class Mail in an effort to curtail the enormous financial losses that continue to plague the struggling agency.
Jacob Bogage of The Washingon Post noted on Monday:
Most of DeJoy’s changes will not face regulatory road blocks. The postmaster general unilaterally controls operating hours at post offices, and the board of governors appears to back DeJoy’s changes to delivery times. Bloom will join DeJoy on a webinar Tuesday to announce the policies.
The Postal Service must consult the Postal Regulatory Commission on price increases, but the regulator issues only a nonbinding advisory opinion. A group of mailers is suing the commission to block the new pricing regimen, but DeJoy has signaled he plans to forge ahead with new prices regardless.
DeJoy plans to extend the service standard for first-class mail by a day, the people said, confirming a previous Washington Post report. The Postal Service currently aims to deliver local first-class mail in up to two days, and nonlocal mail in three to five days. The agency has missed those metrics for years but has struggled mightily during DeJoy’s tenure.
“The need for the U.S. Postal Service to transform to meet the needs of our customers is long overdue,” DeJoy, who was appointed by former President Donald Trump, said. “The Postal Service’s problems are serious, but working together, they can be solved. Our 10-year plan capitalizes on our natural strengths and addresses our serious weaknesses.”
One of the measures DeJoy presented as a means of cutting costs will be shifting “from unreliable air transportation to more reliable ground transportation.”
DeJoy said that the goal is “enhanced package delivery services for business customers” and a $40 billion investment “in workforce, new vehicles, improved Post Offices, technology improvements, and infrastructure upgrades.”
DeJoy will also ask Congress to eliminate the financially burdensome requirement that the USPS set aside billions of dollars to fund pensions for future employees. Instead, he believes that retirees should be made eligible for Medicare.
USPS lost $9 billion in 2020 and its outstanding liabilities total nearly $80 billion – most of which is because of unfunded future pensions.
The USPS is “in a death spiral,” DeJoy told lawmakers. “The status quo should be acceptable to no one,” he said, insisting that his changes add up to “a very positive vision.”
Meanwhile, The American Postal Workers Union said in a statement that the plan “contains both positive attributes as well as some proposals that should be of concern to postal workers and customers” and “long overdue proposals for upgrading local post offices and enhancing products and services.”
It added that it has “deep concerns” with “any proposals that would either slow the mail, reduce access to post offices, or further pursue the failed strategy of plant consolidation will need to be addressed.”
But not everyone shares the APWU’s cautious optimism.
The Save the Post Office coalition said in its own statement that “asking Louis DeJoy to make a ten-year plan for the Post Office is like asking the fox to build a better hen house. After his record of destruction, incompetence, and self-dealing over the last nine months, the only plans he’s qualified to make at this point are his own retirement plans.”