The U.S. Postal Service warned Congress this week that it will completely "run out of cash" in the next several months without immediate action from the White House and Congress, but—with as many as 630,000 jobs at risk—President Donald Trump and Republican lawmakers have refused to commit to rescuing the prized government institution as it falters amid the coronavirus pandemic.
Postmaster General Megan Brennan told the House Oversight and Reform Committee in a briefing on Thursday that the USPS will need access to a total of $75 billion in cash, grants, and loans in order to avert financial ruin by the fall.
"Our Postal Service is on the verge of collapse. I'm calling on Congress to act swiftly to shore up USPS so that everyone can continue to receive essential medicines and supplies, and as many Americans as possible can vote from home."
—Sen. Elizabeth Warren"We are at a critical juncture in the life of the Postal Service. At a time when America needs the Postal Service more than ever, the reason we are so needed is having a devastating effect on our business," said Brennan, referring to the coronavirus outbreak, which has led to a sharp decline in mail volume.
As Government Executive reported, "House Democrats pushed for a $25 billion cash infusion for the Postal Service as part of the last stimulus package, but Senate negotiators ultimately opted to include only a $10 billion line of credit. Postal management has said that amount would be insufficient for preventing fiscal calamity this year."
President Donald Trump has thus far rejected the Postal Service's requests. During a press briefing earlier this week, Trump urged USPS to simply "raise the prices by, actually a lot."
Rep. Gerry Connolly (D-Va.), one of the most vocal critics of the Trump administration's refusal to assist USPS, said in a statement Thursday that "we cannot allow the Postal Service to collapse."
"To do so would deepen our nation's economic crisis and eliminate an important lifeline for individuals who rely on the Postal Service's 1 billion deliveries of lifesaving prescription deliveries and eviscerate the very infrastructure we need to administer the upcoming elections," said Connolly.
In a tweet Thursday, Connolly accused Trump of personally intervening to block the approval of any emergency funding for the Postal Service.
According to new reporting from the Washington Post on Saturday, Connolly's accusation was correct. "Trump threatened to veto the $2.2 trillion Coronavirus Aid, Relief, and Economic Security, or CARES, Act if the legislation contained any money directed to bail out the postal agency, according to a senior Trump administration official and congressional official," the Post reported.
I spoke with the Postmaster General again today. She could not have been more clear: SCROLL TO CONTINUE WITH CONTENT Never Miss a Beat. Get our best delivered to your inbox. The Postal Service will collapse without urgent intervention, and it will happen soon. We’ve pleaded with the White House to help. @realDonaldTrump personally directed his staff not to do so. https://t.co/5wPQvbA951 — Rep. Gerry Connolly (@GerryConnolly) April 9, 2020
The New York Times reported Thursday that a bailout for the Postal Service "has already emerged as a political sticking point" in talks over another large coronavirus stimulus package, "with Democrats pressing to deliver one and President Trump, a persistent critic of the agency, opposed."
"Some lawmakers, postal union representatives, and others who rely on the service now fear that the Trump administration is trying to use the current crisis to achieve conservatives' longstanding goal of nudging the mail service toward privatization," the Times noted, "either by setting highly prescriptive loan terms or by essentially forcing it into bankruptcy. That would aid commercial competitors like FedEx and UPS."
Progressives argue that a major culprit behind the Postal Service's financial woes is a 2006 law that requires USPS to prefund its retirees' health benefits through the year 2056. As Sarah Anderson and Brian Wakamo of the Institute for Policy Studies wrote last year, "this extraordinary mandate, which applies to no other federal agency or private corporation, created a financial 'crisis' that has been used to justify harmful service cuts and even calls for postal privatization."
In a tweet Friday, Sen. Elizabeth Warren (D-Mass.) urged Congress to take immediate action to provide relief to USPS as the Trump White House refuses to budge.
"Our Postal Service is on the verge of collapse," said Warren. "I'm calling on Congress to act swiftly to shore up USPS so that everyone can continue to receive essential medicines and supplies, and as many Americans as possible can vote from home."
JayceeHOFer on April 11st, 2020 at 16:41 UTC »
Then there is the Postal Accountability and Enhancement Act of 2006 (PAEA), which some have taken to calling "the most insane law" ever passed by Congress. The law requires the Postal Service, which receives no taxpayer subsidies, to prefund its retirees' health benefits up to the year 2056. This is a $5 billion per year cost; it is a requirement that no other entity, private or public, has to make. If that doesn't meet the definition of insanity, I don't know what does. Without this obligation, the Post Office actually turns a profit. Some have called this a "manufactured crisis." It's also significant that lots of companies benefit from a burden that makes the USPS less competitive; these same companies might also would benefit from full USPS privatization, a goal that has been pushed by several conservative think tanks for years.
Paying retiree obligations isn't the issue here; rather, being singled out as the only company with a congressional requirement to fully fund those obligations is. It puts the USPS at a huge competitive disadvantage. Yes, a retirement crisis is brewing; most private-sector pensions are wildly underfunded. But the solution is to mandate that ALL companies cover a higher percentage of their future obligations -- not just one entity.
What about lobbying Congress for changes to these rules? Unlike private-sector entities, the Postal Service is barred from lobbying. Similar restrictions do not apply to FedEx or UPS or other carriers.
Waxcarver on April 11st, 2020 at 16:17 UTC »
Millions of Americans depend on the Post Office. I don’t understand not supporting it? I can’t get a teenager to walk across the street for 55 cents, but the post office will take a letter across the country, find the address I wrote on the envelope and put it inside a box at their door! For 55 cents!! It’s unbelievable when you think about it.
Backbeatking on April 11st, 2020 at 16:10 UTC »
Can't vote by mail if there's no post office.