By Rep. Dennis Ross
The United States Postal Service does not take one dime of taxpayer money. You've heard this, I've heard this, and it is something postal employees say to me time and time again. For the most part, it is absolutely true.
It is what postal unions won't tell you that should scare every taxpayer.
Before I scare you, let me say that the USPS is home to hundreds of thousands of dedicated, hard-working American citizens. Many veterans wear the uniform of the Postal Service with as much pride as they wore the uniform of the armed services. Unfortunately, they and the taxpayer, are being fleeced by politicians, union leadership and a service unwilling to change.
There are those who say "privatize it." Unfortunately, no one will buy it. UPS and FedEx need the Postal Service, and the relationship is less adversarial and more symbiotic today than ever.
There are those who say, "get rid of it, I will use email." Unfortunately, you can't get pills via email, send toys to the grandkids via email or conduct some commercial enterprises without the mail.
It is not a choice between having a Postal Service and not. It is a choice of having a Postal Service that works, does not take taxpayer money and meets the needs of a 21st-century information society or a Postal Service whose only hope of survival is a taxpayer-funded bailout.
First, the facts.
In 1971, Congress created the USPS as a self-supporting, independent agency. According to the Office of Personnel Management, "Congress granted the USPS fiscal independence in exchange for a promise of fiscal responsibility." The USPS got independence, what taxpayers did not get was fiscal responsibility.
For the next 35 years, the USPS negotiated agreements with several unions that include guaranteed yearly raises, no layoff contracts, lifetime health benefits and a guaranteed defined-benefit pension. While these generous benefits were conferred on postal employees, and postal unions continued to support politicians who supported them, the Postal Service was not saving money to pay these obligations.
Fast forward to 2006. Congress, recognizing that the pension and health care obligations made by the USPS are guaranteed by the taxpayer, and seeing that obligation rise to $75 billion, began to demand that the USPS start putting away money immediately to fund the obligations they had already incurred. Make no mistake, what you just read is the reality of the past 40 years. The USPS basically agreed to extremely generous employee salaries and benefits, without saving for the bill that was to come due. They did this knowing full well that the taxpayer was the final guarantor of these obligations.
Today, according to a 2011 Government Accountability Office report, the unfunded liability -- the taxpayer backstop -- for past and current postal employees is $105 billion. Regardless of the smoke and mirrors coming from postal unions, the American taxpayer is on the hook for more than $100 billion in benefits for employees who retired or are working today -- that does not even take into account employees hired tomorrow.
But it gets worse. Postal unions will tell you that the 2006 requirement to start "prefunding" these obligations is the only reason the Postal Service is losing money. Again, this claim crumbles under the light of the USPS financials. The USPS loses $25 million per day. This year, it is projected to lose about $15 billion. According to the USPS itself, the Postal Service will face annual losses as great as $22 billion by 2020. The funding requirement is about $5 billion per year.
The problems, and the debts, are large. But there is hope.
A bill, HR 2309, which I introduced with Oversight Chairman Darrell Issa of California, would give the postmaster general flexibility to operate the USPS as a business, take politics out of facilities closures, right-size the workforce without layoffs, and change the way health care and pensions are funded and negotiated.
It will demand tough choices. As The Ledger recently pointed out, a Lakeland facility is part of the closure and realignment plan. As long as politics is not involved, I believe the postmaster general should be allowed to right-size his facilities.
Our bill would also allow the postmaster to decide to go to five-day delivery, cluster-box delivery rather than door-to-door, advertise on stamps and vehicles, and much more. We would also incentivize the 100,000 employees who are past retirement age, and the 150,000 who are three years or less from retirement, to retire through buyouts.
Too many politicians are trying to protect their turf, and too many union bosses are trying to protect their cash flow from dues. My mission is to protect the taxpayer and save one of America's oldest institutions. I intend to deliver.