The American public strongly supports the United States Postal Service. In a recent Pew Research Center poll, 91% of respondents had a favorable view of it, putting it at the top of list of most favored government agencies.
The new Postmaster General, Louis DeJoy.
Meantime, USPS is in deep financial trouble, losing 78 billion dollars from 2007 to 2019. This may not be breaking news, but recent reports show the situation has reached a critical stage.
In March, the outgoing Postmaster General Megan Brennan reported to the House Committee on Oversight and Reform that USPS will go bankrupt by the end of Fiscal Year 2020 without additional aid, along with structural and functional changes.
Soon, there will be a new Postmaster General to address these concerns. On June 15, Brennan will be replaced by businessman Louis DeJoy. He will be the 75th Postmaster General and the fifth to hold the position without any USPS experience since 1971. Mr. Jay said in the USPS release "It will be an incredible honor to serve as Postmaster General, and I commit myself to upholding the Postal Service’s cherished role in our nation.”
Here's the breakdown of the U.S. Postal Service's immediate concerns:
The funding battle between the Congress and the White House
The COVID-19 "CARES Act" provided USPS with 10 billion dollars. In March, the Trump Administration halted a bi-partisan congressional effort to provide an additional 13 billion dollars to the USPS. President Trump is on the record saying during the signing of the April 24th coronavirus relief bill:
"The post office, if they raised the price of a package by approximately four times, it would be a whole new ballgame...”
Since then, 83 House Democrats have countered with a letter supporting a 75 billion dollar plan.
GAO report defines the issues
The U.S. Government Accountability Office just released a report titled "US Postal Service: Congressional Action Is Essential to Enable a Sustainable Business Mode."
The report shows that USPS has billions of dollars in unfunded retiree health benefits and employee pension benefits. The GAO says the retiree health benefits fund will have no money left by 2030, unless payments are made into the account.
Additionally, Lori Rectanus, a GAO Physical Infrastructure Director, described the financial situation on the "GAO Watchdog Report" podcast:
"...Last year it cost the Postal Service almost $80 billion to deliver the mail six days a week to over 150 million addresses, but it only received $71 billion to do that. So, this deficit sort of situation is not new."
Here are the GAO's recommendations from the report:
Congress should consider reassessing and determining the (1) level of postal services the nation requires, (2) extent to which USPS should be financially self-sustaining, and (3) appropriate institutional structure for USPS.
The report says both the USPS and the Postal Regulatory Commission generally agreed with the GAO findings.
The report was requested by Senator Ron Johnson (R-Wisconsin), the Chairman of the Senate Committee on Homeland Security and Governmental Affairs and Senator Jim Jordan (R-Ohio) the ranking member of the House Committee on Oversight and Reform House.
The next steps
Debate on the postal service funding will continue for the time being.
Members of Congress want to repeal the 2006 Postal Accountability and Enhancement Act, which is roundly criticized for creating most of the service's financial troubles, by legislating that employees’ retirement and health-care benefits be pre-paid.
Incoming Postmaster General DeJoy, the current Chairman and CEO of New Breed Logistics, is seen as an expert in supply chain logistics, program management and transportation support. He is expected to propose new ways to save money.