The Cold, Hard Truth about the Post Office

Apparently, Congress doesn't have time to pass an economic stimulus package and save the American economy, but they do have time to address — in an emergency session no less — the Post Office.  Yeah, yeah, we're being told that it's some deep plot to fiddle with the election by suppressing mail-in ballots, but why don't we look at the facts?

I do know a little about the Postal Service — my dad was a "letter carrier" for over thirty years.  Back then, we called him a "mailman" because, well, he delivered mail, and he was man.  But today...  Anyway, let's take a dive into some numbers and see if all the hoopla is really accurate.

Last year, fiscal 2019, the USPS lost almost $9 billion on operations.  Let that sink in.  It's about $27 for every man, woman, child, and non-binary person in the country.  That means, in addition to paying to mail stuff or have it mailed to you, you also paid an extra $27.  That's about a hundred bucks a year for an average family of four.  And by the way, last year was the thirteenth consecutive year the USPS lost money.

Clearly, the Post Office needs fixing.  It loses money — tons of money — and something has to change.  But let's put that thought on hold for a bit.  Instead, why don't we take a peek at what's happening below the surface?  Maybe we can also find out about this whole recent uproar about suppressing the vote by reducing USPS service.

Mailboxes!  My dad would be angry at me for misspeaking.  Collection boxes!  You know, those big blue hunks bolted to street corners that always squeak when you open the slot to drop a letter inside.  Apparently, the USPS is ripping them out so folks can't mail their harvested ballots back in November.  I've even seen pictures of trucks with collection boxes stacked on them on the internet, so it must be true.

Well, it turns out that it is true!  The USPS is removing mailboxes.  But wait!  They've been doing this for decades!  It's nothing new.  According to the USPS and the Universal Postal Union (a United Nations organization, so we believe them), between 2000 and 2015, the number of collection boxes in the U.S. declined from 365,000 to 153,000.  Wait...that was the Obama administration suppressing the vote!  Probably not true, but why were the boxes being removed?

Why don't we turn to the USPS deputy inspector general for an answer?  She was an Obama appointee and in 2016 said, "As the Postal Service adapts its collection infrastructure to meet customers' needs at a reasonable cost, it has eliminated underused collection boxes that on average receive fewer than 25 pieces a day, and added collection boxes that are convenient for customers."  Ah, so it's an efficiency "thing."  And here's another idea.  Rather than wandering all over the city trying to find one to mail a letter, why not just put it in the mailbox you get your daily deliveries in?  You know, the one that is just a few feet from your door!

"But wait," they scream.  "What about all the other cuts to slow down the mail and make ballots arrive too late to be counted?"  Okay, then, let's have a look at service efficiency.  According to the Postal Service website, over the past five years, the total amount of mail handled has declined from about 156 billion to about 143 billion pieces per year.  Included in this decline is even an increase of about two billion more packages from places like Amazon and eBay. 

So if you were a business person and you saw your business declining by that much, wouldn't you get rid of some staff?  Yeah, but you're not the Post Office.  During that same period of time, the number of Postal Service employees actually increased by about 10,000 folks.  More employees, less mail, but slower delivery times?  I'm struggling with the math here.

Look, the facts are these: the Post Office has been yanking out collection boxes forever, the volume of mail has been declining for years, and the size of the Post Office staff has increased.  Does Trump hate mail-in voting?  He says he does (but he votes by mail).  Is he monkeying with the USPS to mess up mail-in voting?  It sure doesn't seem like it.  But I'm certain the Democratic Congress will find out — maybe they'll even appoint a special prosecutor!

In the meantime, we're told that the Post Office loses so much money because it has to set aside cash for its future retirees in advance.  Okay, but that's what every firm has to do if it maintains an employee pension plan.  Plus, like many businesses and local governments, the Post Office hasn't even done that since 2012.  That's right: the USPS hasn't funded its retirement plan for almost a decade.  Sorry, Dad...

Kevin Cochrane teaches business and economics at Colorado Mesa University and is a former senior national banking executive.

Apparently, Congress doesn't have time to pass an economic stimulus package and save the American economy, but they do have time to address — in an emergency session no less — the Post Office.  Yeah, yeah, we're being told that it's some deep plot to fiddle with the election by suppressing mail-in ballots, but why don't we look at the facts?

I do know a little about the Postal Service — my dad was a "letter carrier" for over thirty years.  Back then, we called him a "mailman" because, well, he delivered mail, and he was man.  But today...  Anyway, let's take a dive into some numbers and see if all the hoopla is really accurate.

Last year, fiscal 2019, the USPS lost almost $9 billion on operations.  Let that sink in.  It's about $27 for every man, woman, child, and non-binary person in the country.  That means, in addition to paying to mail stuff or have it mailed to you, you also paid an extra $27.  That's about a hundred bucks a year for an average family of four.  And by the way, last year was the thirteenth consecutive year the USPS lost money.

Clearly, the Post Office needs fixing.  It loses money — tons of money — and something has to change.  But let's put that thought on hold for a bit.  Instead, why don't we take a peek at what's happening below the surface?  Maybe we can also find out about this whole recent uproar about suppressing the vote by reducing USPS service.

Mailboxes!  My dad would be angry at me for misspeaking.  Collection boxes!  You know, those big blue hunks bolted to street corners that always squeak when you open the slot to drop a letter inside.  Apparently, the USPS is ripping them out so folks can't mail their harvested ballots back in November.  I've even seen pictures of trucks with collection boxes stacked on them on the internet, so it must be true.

Well, it turns out that it is true!  The USPS is removing mailboxes.  But wait!  They've been doing this for decades!  It's nothing new.  According to the USPS and the Universal Postal Union (a United Nations organization, so we believe them), between 2000 and 2015, the number of collection boxes in the U.S. declined from 365,000 to 153,000.  Wait...that was the Obama administration suppressing the vote!  Probably not true, but why were the boxes being removed?

Why don't we turn to the USPS deputy inspector general for an answer?  She was an Obama appointee and in 2016 said, "As the Postal Service adapts its collection infrastructure to meet customers' needs at a reasonable cost, it has eliminated underused collection boxes that on average receive fewer than 25 pieces a day, and added collection boxes that are convenient for customers."  Ah, so it's an efficiency "thing."  And here's another idea.  Rather than wandering all over the city trying to find one to mail a letter, why not just put it in the mailbox you get your daily deliveries in?  You know, the one that is just a few feet from your door!

"But wait," they scream.  "What about all the other cuts to slow down the mail and make ballots arrive too late to be counted?"  Okay, then, let's have a look at service efficiency.  According to the Postal Service website, over the past five years, the total amount of mail handled has declined from about 156 billion to about 143 billion pieces per year.  Included in this decline is even an increase of about two billion more packages from places like Amazon and eBay. 

So if you were a business person and you saw your business declining by that much, wouldn't you get rid of some staff?  Yeah, but you're not the Post Office.  During that same period of time, the number of Postal Service employees actually increased by about 10,000 folks.  More employees, less mail, but slower delivery times?  I'm struggling with the math here.

Look, the facts are these: the Post Office has been yanking out collection boxes forever, the volume of mail has been declining for years, and the size of the Post Office staff has increased.  Does Trump hate mail-in voting?  He says he does (but he votes by mail).  Is he monkeying with the USPS to mess up mail-in voting?  It sure doesn't seem like it.  But I'm certain the Democratic Congress will find out — maybe they'll even appoint a special prosecutor!

In the meantime, we're told that the Post Office loses so much money because it has to set aside cash for its future retirees in advance.  Okay, but that's what every firm has to do if it maintains an employee pension plan.  Plus, like many businesses and local governments, the Post Office hasn't even done that since 2012.  That's right: the USPS hasn't funded its retirement plan for almost a decade.  Sorry, Dad...

Kevin Cochrane teaches business and economics at Colorado Mesa University and is a former senior national banking executive.