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Spotlight on Postal Reform: New Legislation would revitalize 30-year-old business plan July 2004 For the first time since the 1970s, postal reform bills have been voted out of committee and are being openly debated in both the House of Representatives and the Senate. The Postal Accountability and Enhancement Act (H.R. 4341, S. 2468) poses major changes to the United States Postal Service and provides much needed control over its management practices and funds. Dennis Moore (D-KS) has joined as a cosponsor of the bill. "We are pleased that postal reform is finally moving forward," said Jerry Cerasale, senior vice president of government affairs at the Direct Marketing Association. "We are finally out of committees in both houses, which is excellent. This is something we haven't had for 30-plus years." A recent study by the Envelope Manufactures Association's Foundation reported 191,378 Missourians and 93,684 Kansans employed in mailing-related jobs. The Mailing and Fulfillment Service Association (MFSA) estimates more than 49,000 jobs in Kansas and Missouri could be lost if postal reform is not enacted. Postal reform would relinquish the roughly $3 billion a year overpaid to an escrow fund for retirement funds. It would also remove the obligation to pay the cost of the Civil Service Relief Fund earned by postal employees during military service. The USPS is the only government entity required to pay the military retirement funds their employees receive. The CSRF matter alone could cost the USPS an estimated $27 billion. These two matters are essential, as these financial burdens will certainly spawn a rate increase in 2006. Postal reform would also give the USPS more control over managing itself. While the government entity operates, for the most part, independently from the government, there are certain political stipulations that hinder the day-to-day dealings of the post office. It cannot, for example, close unnecessary offices and does not have control of the necessary means to recruit exceptional management. So what does this mean to the average postal customer? If the post office is not able to function efficiently and is not given the means to manage itself responsibly, postal rates will rise. Remember, the post office runs on volume. Rising postal rates mean less mail volume, which means less revenue. This in turn encourages more postal rate increases and could initiate what many are calling a "death spiral" for the USPS. Nationally, the mail industry employs 9 million Americans and represents 9 percent of the gross domestic product. |
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