By Devin Leonard
Like many House Democrats, Representative Peter DeFazio of Oregon is unhappy with the U.S. Postal Service's efforts to live within its means. But DeFazio isn't critical of just Postmaster General Patrick Donahoe for closing mail-processing centers and trying to move to five-day delivery to ease the fiscal crisis at the USPS, which is losing $25 million a day. He's frustrated that President Obama isn't working on a solution. So he mounted a petition drive on the White House's We the People site, which garnered 30,000 signatures to get the president to support his bill to fix the USPS. The petition failed--you need 100,000 signatures to trigger a response from the administration. But DeFazio's efforts raised an intriguing question: Why has Obama been silent about the crisis at the Postal Service? DeFazio talked to Bloomberg Businessweek's Devin Leonard about his frustration with Donahoe, Obama, and the future of the USPS. The interview has been edited and condensed.
Why did you decide to take this approach with your bill?
I've been trying since last year to get some attention at the White House. Personally, during the election, I thought it would be a good issue. I was not successful. It's not on their radar screen.
How do you explain the White House's silence on this issue?
I can't explain it. Sure, they've got a lot of stuff going on. But I just think it's something that merits involvement by the White House, and I'm continuing to push on that. We've got 30,000 signatures. We've got about 160 co-sponsors on my bill.
Why is this such a big issue to you?
I represent the 37th-largest district in land area in the United States. I have a tremendous number of rural communities. The Postal Service is essential for those small towns. I just heard from hundreds of small business folks saying, "Hey, if I had to use FedEx (FDX), I'd be out of business. I mean, I use that service."
You called for Patrick Donahoe's resignation. How come?
If we go to five-day delivery, that will put them in a death spiral. If you degrade first-class mail to three- to five-day delivery, which he would by closing these regional sorting centers, you have the potential of letters taking five days for first class. As far as I can tell, this guy really wants to destroy the Postal Service.
Some people say the real problem is he's being micromanaged by Congress.
He was stymied in going to five-day delivery, but that's not exactly micromanaging. That's keeping him from putting the post office into a death spiral. But Congress has yet to meaningfully act to deal with this absurd problem that the post office is being required to prepay health care for people who have not yet been born, who might someday work for the post office, if it still exists. I mean, that's just crazy stuff.
But even if you removed the pre-funding, the Postal Service would still be losing money.
They should be given more flexibility in setting rates. Give them authority to partner with states to provide hunting and fishing licenses. Adopt things like some of the European countries have done, where you can sign up to have your junk mail scanned. They'll send it to you as a scan, and if you want it delivered, you can tell them to deliver it. If you want them to recycle it, you tell them to recycle it. The post office makes money by doing that. But they're not allowed to do things like that here. They can't innovate. So I would look for a postmaster general who would say, "I need authority to innovate." But that's not what we're hearing from this postmaster general. He's, like, "Ah, I've just got to cut things."
But in fairness, I think they are trying to do some of that stuff.
Well, I haven't heard Donahoe ever give a speech outlining objectives to modernize the Postal Service and deal with these problems.
You're not the first person to make some of these proposals that are in your bill. How come nothing happens?
Congress is very, very good at doing nothing. These new 80 or 90 people, ultra-libertarians in the House who don't believe in government, even though the Postal Service is in the Constitution. I can't explain it. FedEx and UPS (UPS) are not going to pick up the burdens of the Postal Service if it goes under. They're not going to do universal delivery. In fact, they depend on the Postal Service now to do a lot of last-mile delivery. So there's no rational reason why we shouldn't fix the Postal Service.
I don't know why the business community isn't weighing in in a bigger sense on this. I mean, EBay (EBAY) or Amazon.com (AMZN) are huge users of the Postal Service. Their costs are going to go up if the Postal Service goes under, because it's all going to go to the remaining private companies, who may or may not want to go and deliver stuff to remote rural areas.
President Richard Nixon, a Republican, reorganized the Postal Service in 1970, and both houses were in the opposite party. What's stopping President Obama?
Well, Nixon was dealing with Democrats who do believe in government.