William Burrus  APWU President

President's Viewpoint

What’s Wrong …and What Can Be Done

(This article was first published in the May/June 2009 issue of The American Postal Worker magazine.)

You certainly have heard about and probably have witnessed the reduction in mail volume that is taking such a serious toll on postal revenue. It is important that APWU members understand that this is not a business-as-usual event that can be corrected in the short-term. The U.S. Postal Service will have to fight to remain viable, and we are not likely to see a return to “normal” for several years.

Many employees are skeptical. They do not believe things are as bad as have been reported; they think discussions of the USPS financial crisis are a management ploy to scare employees while allowing service to deteriorate. Whatever is wrong, many employees say, it is management’s fault.

Let me set the record straight: The crisis is real and it is serious, but postal management is not responsible for the dramatic reduction in mail volume and the resulting financial deficits. There are three main causes of the Postal Service’s predicament: The weak economy, a law that poses an unreasonable obligation on the USPS to pre-fund the healthcare benefits of future retirees, and a flawed business strategy.

The faltering economy is to blame for the severe loss of mail volume that threatens the foundation of the Postal Service. Because it does not receive federal funding, USPS income is derived almost entirely from sales: As mail volume is depressed, revenue falls. If the financial condition declines to such an extent that the Postal Service is unable to meet its obligations, the entire network will be in jeopardy.

Employee paychecks are no different than electricity and transportation expenses and thousands of other obligations. The biweekly payroll costs the USPS approximately $2 billion. If the bills and obligations exceed the revenue and USPS borrowing authority, the options are limited: Someone does not get paid.

H.R. 22

Immediate and essential assistance can be achieved through the passage of H.R. 22, a bill that would temporarily relieve the Postal Service of the requirement to make annual payments — of more than $5 billion per year — for future retiree healthcare benefits.

We have already obtained more than 250 co-sponsors of the bill and have reached our objective of support from a majority of the House of Representatives. If the name of your representative is not included in the list, you have the responsibility to contact his or her office to demand support. The future of the Postal Service and the future of your job depend on the passage of this bill.

H.R. 22 is essential, but even if it is adopted, the Postal Service will not immediately return to solvency. A healthy U.S. economy is a prerequisite to a stable Postal Service. For that reason, President Obama will need our support in his efforts to repair the economy. On March 26, I met with representatives of the Obama administration, along with the other postal union presidents, to share our views on what can be done to improve the situation. We received a pledge of support and a promise of continued communication.

The Struggle for Solvency

The future of each postal job is at stake in this struggle. As we fight over the issues of excessing, reassignments, job jurisdiction and other day-to-day issues of employment, we must focus on the preservation of the Postal Service.

The future of a federal mail service is no longer guaranteed. If we reach the point of postal insolvency, the government will be forced to make a decision regarding its role in the exchange of hard-copy communication: We do not want to be in the position of relying on government intervention to ensure the continuance of mail service as we know it.

The recent experience of the automobile industry would pale in comparison to a postal bailout. The Postal Service employs twice as many workers as the American automobile industry, and its annual budget would require tens of billions of dollars in assistance, all while the American public is experiencing a “bailout burnout.” Postal employees do not want the future of their employment dependent on the politics of the federal government.

Failing to Keep Pace

How did we get to this point? From the use of smoke signals through the telegraph, telephone, fax, e-mails and the Web, methods of communication have evolved, and they will continue to do so. The U.S. Postal Service has been a pillar of the communication system and has played a major role in the country’s growth and prosperity, but it has not kept pace with the development of new technology.

As communication became faster and less expensive, the USPS business model remained essentially the same, based on the belief that users would continue to access fixed and physical message transmission systems. As the world moved toward instant, electronic communications, the Postal Service made little effort to remain relevant. As mail began to migrate to other formats, postal management failed to transform its national network, delivery force, and stellar name-recognition to meet the emerging needs of our society.

Instead of adjusting to technological changes, postal officials bemoaned the emergence of other forms of communications, most notably e-mail and the Internet, as the central cause of its reduced role. An analogy I often cite is that of the blacksmith blaming the automobile for his demise. The blacksmith naively thought he was in the horseshoe business, when in reality he was in the transportation industry. Postal managers have displayed a similar lack of understanding.

Looking Ahead

There has been at least one positive sign. I am heartened by recent comments by postal officials that the Internet is not the main cause of stagnant volume and the resulting financial deficits. In an interview with the Washington Post, Deputy Postmaster General Pat Donohue explained that “new forms of communications are not a threat to the Postal Service … in fact, the year of the highest mail volume was 2006, when e-mail and Internet use was as prevalent as it is today.” This admission, though tardy, is the first step in remaking the Postal Service into a more relevant part of society. The focus must shift to the future as opposed to bemoaning the past.

Postal management’s response to the dismal situation has been in keeping with its historic knee-jerk reaction: Excessive discounts for major mailers, a reduction in the number of employees and postal facilities, and other drastic cost-saving measures. If this is the entirety of the plan for saving postal services, it is doomed from the outset.

The downward trajectory caused by these activities can lead only to an inglorious result — the end of government sanctioned universal service at uniform rates. We have every reason to expect more from officials who have been entrusted with the proud tradition of the Postal Service. In my most recent testimony before a Congressional subcommittee I said:

“The feeble efforts by postal management were akin to jumping from the height of a five-story building and flapping your arms on the way down. The effort would not cushion the impact, but it gives you something to do.”

Instead of flapping their arms on the way down, responsible officials should be strategizing about how the Postal Service’s assets — the world’s best delivery force, the most comprehensive network, 700,000 dedicated employees, and the highly respected name of the U.S. Postal Service — can be molded into a vibrant communication system far into the future.

Postal employees and the American people have every reason to expect as much from those who are responsible for preserving an institution that pre-dates the Constitution of the United States of America.