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Mr. CORKER. Mr. President, I rise today to speak about amendment No. 2083, which I am offering to the bill that is before us.
I think all of us know the U.S. Postal Service is absolutely not sustainable in its current form. Mail volume has greatly declined over the past decade and will continue to do so over the next decade. The U.S. Postal Service has known this for a long time. They knew that mail volume was declining and that the market for their products was changing. But the economic crisis made things far worse than they could imagine.
Now the Postal Service is on the edge of financial ruin. But we didn't get here only because of the economic crisis; it is because the U.S. Postal Service's business model is fundamentally broken. The USPS lost $5.1 billion in this last fiscal year and $3.3 billion in the first quarter of the current year. I know some have tried to blame the requirement that the USPS prefund their retirement health benefits for the USPS's financial losses. But the fact is that these recent losses are not due to the prefunding requirement because Congress has allowed the USPS to delay this last year's payment. The U.S. Postal Service has also nearly reached its statutory borrowing limit.
Faced with this situation, it is abundantly clear that the USPS must make radical changes in its existing infrastructure and business model. Again, USPS should have, could have, and indeed has wanted to begin making these changes to its outdated, excessive infrastructure, but Congress--all of us here or at least some of us here have blocked these attempts. We should give the USPS the flexibility to meet these challenges and make business decisions on how to deal with the paradigm shift in their primary market rather than further limiting their ability to adapt.
My amendment to S. 1789 gives the U.S. Postal Service greater flexibility in three primary areas: facilities and service, pricing, and labor.
On facilities and service, it allows the U.S. Postal Service to continue closing post offices using the existing procedures for post office closures--they already exist--instead of creating further barriers to closure, which this bill does. These procedures are well thought out and give ample opportunities for public comment and appeal.
It also allows the Postal Service to proceed with its proposed change in delivery service standards--something it has proposed--which is a key component of its 5-year plan of profitability.
This amendment also allows the Postal Service to immediately implement 5-day delivery, if it chooses--a move the U.S. Postal Service believes may save nearly $2 billion a year. The underlying bill, on the other hand, requires a 2-year delay and further study of this issue, which the Postal Service already knows needs to happen. Mr. President, we don't need a study to tell us what we already know.
The Postal Service needs flexibility in its delivery schedule.
A number of interested parties, including the Postal Service and the President of the United States--the President--support moving to a 5-day delivery. Furthermore, my amendment allows the Postal Service to close processing and distribution centers, something the Postal Service has identified as needed action for nearly a decade.
On pricing, my amendment removes the arbitrary CPI-based cap put in place by the 2006 Postal Accountability and Enhancement Act. Put simply, this gives the Postal Service more flexibility to adjust their prices as markets change.
Current law and S. 1789 actually mandate the Postal Service provide some services at a loss. It is unbelievable the calls we have been receiving in our office that basically point to the tremendous corporate welfare that is in existence--people calling me not wanting these changes because it affects their business. A congressional mandate that the U.S. Postal Service provide certain services without covering their costs makes very little sense.
Please note, this would not allow the Postal Service to arbitrarily raise rates at will. They would still be subject to Postal Regulatory Commission--the PRC--regulation.
Finally, on labor, my amendment gives the Postal Service greater flexibility to reduce its workforce as needed and negotiate contracts that make sense for its financial situation. Since labor costs make up approximately 80 percent of the Postal Service's cost structure, it is clear that any good-faith postal reform proposal must include labor reform.
First, it prohibits the inclusion of a no-layoff clause--and let me underline this--in future collective bargaining agreements. It does not alter CBAs currently in place that contain these clauses. This is only for future clauses. As mail volume continues to decline, the Postal Service must have the flexibility to change the size and makeup of its workforce as needed.
Second, this amendment eliminates a provision in existing law that requires fringe benefits for Postal Service employees be at least as good as those that existed in 1971. These benefits represent a huge portion of fixed labor costs which currently place a major burden on Postal Service operations. Eliminating this provision will give the Postal Service more options in contract negotiation rather than hamstringing them.
My amendment is a balanced approach that strives to give the U.S. Postal Service maximum flexibility in multiple areas as they work toward financial stability. Here is the best part. According to CBO--which just contacted us today--this bill saves $21 billion for the Postal Service over the next decade. Let me say that one more time. CBO has just contacted us. The Postal Service is now in tremendous financial straits, and we have a bill before us that hamstrings them and keeps them from doing the things we all know if this were a real business we would allow to happen. My amendment gives them the flexibility to do the things the Postal Service needs to do and that most every American understands they need to do and the amendment saves $21 billion over the next 10 years.
It is my understanding, by the way, there is no attempt to offset the cost of this bill over the next 10 years.
In conclusion, it is clear the Postal Service must make drastic changes, and I applaud those portions of S. 1789 that allow the USPS greater flexibility. But there are far too many provisions in the underlying bill that would put more restrictions on the U.S. Postal Service, not fewer, and limit the organization's ability to adapt to changing times and so I urge support of my amendment.
I thank the Chair for his time, and I suggest the absence of a quorum.
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Mr. CORKER. Mr. President, just 20 seconds, not to rebut anything that has been said.
I think the Senator from Maine and I have a very different view about the ways to solve the post office issues. But I just want to thank her for her tone. I want to thank the Senator from Connecticut, too, for the way they continue to work together to try to produce legislation in this body. So I thank them both for being the way they are. They are two of the Senators I admire most here. I thank them.
I have a very different point of view on this issue, but I thank them for the way they continually work together to try to solve problems. I look forward to continuing to work with them on this issue.
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