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Your Local Post Office: From Public Service to Profit Piñata

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Last updated on February 8th, 2013 at 12:28 pm

For the past year we have seen an unremitting campaign by the corporate masters of the right wing to either reduce or outright eliminate one of the nation’s most vital public services, the United States Postal Service. Once a cabinet level branch of the executive (more on that later), the postal system that was written into the very Constitution that founded our unified country is once more being threatened by corporate appetites. Their appetite in the case of mail is for profit via privatization, chopping off pieces of a public service, giving it away to the highest bidder, and replacing “public service” with “maximum profitability” in mailing priorities. One can only pause to marvel at the much-proclaimed economic innovative potency of the corporate elites who have (in their inventive genius) deigned to “liberate” the American public of one of its most profitable and effective public services.

The hustle works like this. There are parts of the United States Postal Service that are more profitable than others (this is because the USPS’ chief responsibility is to provide a public service). These very profitable parts are really what the corporate forces crave. Unfortunately, since those profitable parts of mailing services privatizers want are indeed profitable, it used to be fairly general knowledge that the USPS is itself consistently profitable and thus unassailable to “austerity” attacks. The privatizers had no “inefficiency of big government” excuse to raid the Postal Service,. What they’ve done instead is spend nearly a half decade massaging the narrative with the help of a Bush-era law that the right wing currently uses to pretend that “the Post Office is broke.”

Once we also include the reversal of a massive accounting error that should move billions from the Treasury Department into the Post Service we find that in fact the USPS is quite healthy. The only thing sick is the corporate obsession with wringing every last penny of profit from our commons and institutions of public trust.

With more than $700 million in operational profits over the last four years, a time of recession and contraction in much of the rest of our economy, the obvious lie that the Post Office is broke needs the help of manipulated numbers to be believed. So where are right-wingers bringing out these numbers (usually around $13 billion) that reflect four years of straight losses?

Back in 2006, in the Dark Ages of the Bush Administration, Congress passed the Postal Accountability and Enhancement Act (HR 6407) which, among other things, required the USPS to pre-pay the health care benefits for not only its current employees, but also all its possible future employees–for the next 75 years. This is beyond absurd, with absolutely no parallel in either the private or public world. Making this absurdity even more ridiculous is that the USPS is mandated to fund the entirety of this cost by 2016, a cost of approximately $5.5 billion a year. Without this forced accounting trickery, the USPS is more than financially stable, comfortably capable of meeting all its current and future obligations. Add the $5.5 billion in forced annual payments towards this 75-year bill, and it appears that the USPS, which has created more than $700 million in profit over the last 4 years, has actually lost $13 billion over the last four years. It’s accounting hocus-pocus, helped along by a law favorable to the privatizers.

Furthermore, to pretend that this “loss” (which isn’t a loss, but instead a demand to square accounts 75 years early) is somehow a burden on the taxpayer is more than just manipulation: it’s an outright lie. It flatly misrepresents reality.

Remember how the USPS (then the United States Post Office Department) used to be a cabinet-level function of the executive branch? That all changed in 1971, when Nixon’s Postal Reorganization Act took effect. Among other things, this turned the USPS into a semi-corporation heretofore responsible, entirely, for financing itself through sales. Everything the Postal Service does is financed by sales. Taxes, in other words, have not payed a penny into the USPS for over four decades.

In the duplicity of numbers, there’s also a hilarious sidenote to this manufactured crisis, one that rings to the tune of billions. Ignored in the right wing hysteria about a “broke” Postal Service is a more-than-slight overpayment by the USPS into its pension fund thanks to a decades long accounting error.

“Both the Postal Service’s Office of Inspector General (OIG) and the independent Postal Regulatory Commission (PRC) commissioned audits to look into possible overpayments that the Postal Service has made into the Civil Service Retirement System (CSRS). Both audits show that the Postal Service has overpaid at least $50 billion into the pension fund over the past several decades.” (Chuck Zlatkin, “Wait a Minute, Mr. Postmaster: Postal Service Privatizers Push Manufactured Crisis”)

To summarize, the Post Office pays for itself entirely and independently of the US taxpayer–for over 40 years now. Furthermore, without that unparallelled 75-year obligation, not only is the Post Office financially self-sufficient but it is also highly profitable, with an additional check of at least $50 billion due it from the Treasury Department.

While the Post Office could stand to expand to better meet the needs of the 21st century (perhaps entering the wifi field, public notarizing or re-introducing postal savings accounts/check-cashing) the way to move forward faster is certainly not to hobble it with unnecessary cuts. Rather, to ensure the USPS continues forward in a profitable and helpful path, capital investments should be made to improve service while expanding both capacity and market share.

If we really think about that last statement, there’s a fine line being crossed here. Corporations know very well that (besides public hand outs) the best way to save even a company that actually is failing is to innovate, expand capacity and expand market share. But aren’t they arguing the exact opposite logic to “save” the post office–a logic of cut and slash instead of expansion?

These massive shipping giants are literally looking to weaken your country so that they can make an even bigger buck off of it. Through tens of millions of dollars, they’ve even inserted insane requirements for the USPS to pay up its bills 75 years early. They know damn well that the USPS is profitable. It’s in the numbers. It’s also in the fact that they want to privatize it at all (how many corporations do you know that want to take over a doomed industry by comparison?).

At a certain point we in this country will need to discuss how we deal with corporate ethics that threaten the public welfare of millions and whose derivative actions approach classically defined treason. If corporations have all the rights of people, why not the responsibilities? If a stockholder can reap the profit of the corporate entity, why can’t they reap the criminality and jail time? To give this attack on our democratic heritage one last perspective, if instead of a handful of corporations it was a handful of foreign nations that had engaged in this attack on our Postal Service, how would our reaction differ?