US postal workers’ unions pointed to a recent financial statement by the US Postal Service showing that the postal service’s finances have rebounded significantly. The unions also said that USPS’ improved finances calls into question Washington’s conventional wisdom that postal services need to be slashed and good-paying jobs eliminated.
The financial statement says that USPS lost $740 million in the second quarter of 2013.
But the unions and their supporters say that the loss was due to a unique requirement imposed by law on USPS that requires it to pay $5.5 billion a year to pre-fund future retiree health benefits over the next 75 years.
If USPS had not been forced to pay $1.4 billion in pre-funding in the second quarter, it would have recorded a profit of $600 million.
“The latest financial results should convince Congress to deliver a postal reform plan that eliminates pre-funding,” said Fredric Rolando, president of the National Association of Letter Carriers.
Rolando also said that real postal reform would free USPS “to meet evolving customer needs in the digital era.”
Sen. Bernie Sanders (I-Vermont) sponsored such a bill that was introduced in February.
In a message to supporters, Sanders said that USPS “has already set aside enough to meet the health care needs for retirees for decades to come” and called the pre-funding requirement an “onerous burden that no other company or agency is required to pay.”
S 316, Sen. Sanders’ Postal Service Protection Act, would modernize postal delivery, save Saturday mail, and repeal the pre-funding requirement, which Sen. Sanders calls a crippling measure “responsible for 80 percent of the mail system’s funding woes.”
Other legislation has been introduced that would cut services, eliminate jobs, and retain the pre-funding requirement.
The leaders of four postal workers’ unions recently co-authored a letter to Senate Majority Leader Harry Reid urging him to oppose S. 1486, the Postal Reform Act, which the letter says “renews a commitment to the disastrous Bush administration policy to mandate massive pre-funding of future retiree health care benefits and provides for major downsizing measures.”
S 1486 is sponsored by Sen. Tom Carper (D-Delaware) and Sen. Tom Coburn (R-Oklahoma).
According to the letter, if enacted S 1486 would destroy 80,000 full-time and part-time jobs by eliminating Saturday mail delivery, slash tens of thousands of more jobs by closing postal processing centers, undermine delivery standards, and “mandate the elimination of door-to-door delivery for all business and new households.” The bill would also keep the pre-funding requirement in place.
In June, the House Oversight and Government Reform Committee passed out of committee HR 2748 by Rep. Darrell Issa (R-California) that according to Rolando fails to resolve the pre-funding crisis, jeopardizes universal mail delivery, eliminates 100,000 jobs, and attacks the collective bargaining rights of postal workers.
Rolando said that instead of cutting services and good-paying jobs lawmakers should be looking for ways to modernize services. Eliminating the pre-funding requirement would free up resources that could be used to modernize mail delivery in the US.