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Turmoil awaits Postal Service By
Bill McAllister Dec.
29, 2000 - WASHINGTON
- For nearly five years, Rep. John M. McHugh, R-N.Y., tried to convince members
of Congress that the U.S. Postal Service was facing a serious crisis.
But few postal officials supported McHugh, chairman of the House Postal
Service Subcommittee, and legislation he said would preserve the government's
often-abused "snail mail" delivery operation in the age of electronic
mail.
Then, the Postal Service Board of Governors, a group that had remained
noticeably quiet during McHugh's struggles, suddenly declared last month that it
was time for postal reform.
The unanimous vote of the board - nine presidential appointees charged with
overseeing the independent postal agency - came too late to rescue McHugh's
postal reform legislation. It died without reaching the House floor.
But the board's statement appears likely to set the stage for yet another
congressional struggle over how the federal government's largest civilian
employer sets stamp prices and what its future should be at a time when cheaper
electronic communications such as faxes and e-mail have begun slicing away
profitable components of the mail stream.
What appears to have moved the board of governors to action was the recent
recommendation of the independent Postal Rate Commission. The agency approved
the governors' request for a 34-cent firstclass stamp, a 1-cent increase,
effective Jan. 7.
But the commission, which must approve stamp-price increases, rejected other
rate increases, accusing the governors of padding their request for more
revenue. That infuriated some of the governors.
"Some drastic changes are needed in the way this agency operates,"
said governor Ned R. McWherter. The entire board agreed, as did Postmaster
General William J. Henderson.
What the rate commission did by rejecting the rate increases was to cause the
agency's red ink to soar above the $480 million loss that Henderson has
projected for the current year. With labor talks with the agency's politically
powerful unions under way, the agency faces still more costs, enough said
governor Tirso del Junco, of Los Angeles, to bring the losses for the year to
$1.5 billion.
The Postal Service hasn't seen that much red ink since 1992, when they hired
former automaker Marvin T. Runyon to take charge of the agency and cut its staff
drastically.
The governors were proud of having set the agency on a path to record profits
under Runyon and were appalled by the prospect of another series of large
deficits, like those the agency ran up in the 1970s and '80s after it was
directed to live without large tax subsidies.
But the governors may have created an equally daunting challenge for
themselves if they hope to do what McHugh failed to accomplish.
Under the House Republican leadership's rules, McHugh will have to step aside
when Congress convenes in January.
When the governors begin to draft their plan for what they want from
Congress, they will have to confront something they probably don't like either:
Most commercial mailers are happier with the fivemember rate commission than
with the governors.
The commission has protected them from the demands of postal bureaucrats who
would like nothing more than to offset the agency's soaring costs with higher
stamp prices, they say.
So can the governors, who haven't agreed on what they want from Congress,
quickly devise a legislative package that lawmakers will accept? It's going to
be a difficult challenge, most postal officials agree. |