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AFP Raises Serious Concerns Over Postal Reform Bill

Feb 8, 2022 by AFP

Congress missing huge opportunity to put USPS on sustainable path.

Arlington, VA — Americans for Prosperity (AFP) is raising budgetary alarms about a postal reform bill set for a House vote later this week.

The Postal Service Reform Act of 2022 appears to rely on unwise budgetary gimmicks that might shore up the USPS balance sheet in the short term, but likely in exchange for significant long-term cost headaches, AFP indicated in a Monday letter to members of the U.S. House. Congress needs more information about the long-term effects.

“This bill doesn’t seem to actually ‘fix’ the Postal Service’s serial budget deficits, it uses accounting gimmicks to paper over them and shift the burden elsewhere,” said AFP Chief Government Affairs Officer Brent Gardner.  “Congress is missing a huge opportunity to put the USPS on sustainable fiscal path through real, meaningful reforms, like ending service mandates that are well beyond the agency’s means and abilities.”

AFP pointed to six-day-a-week postal delivery as an example of a mandate that makes no sense given the cost and the rise of efficient private-sector competitors.

AFP also criticized measures such as ending the pre-funding of USPS health and retirement benefits, and pushing USPS retirees onto Medicare. This would commit the double sin of just kicking the fiscal can down the road—at unclear future cost—and shifting a sizable financial burden onto the already strapped Medicare Part A fund.

Of particular concern: a provision allowing the USPS to offer ill-defined “non-postal” services, which would supposedly enable the Postal Service to identify new revenue streams. But the agency’s history of effectively monetizing services is questionable at best; the unfair implications for non-public businesses are obvious; and the move risks unsustainably expanding an agency already awash in red ink.

“Since the USPS is a public corporation, the notion that it could compete on a level playing field is farcical,” the AFP letter reads. “The USPS is a government corporation with a monopoly on first-class mail and has many other tax and regulatory advantages over private businesses. Letting the USPS draw traffic for no reason but to cross-subsidize its postal operations could have a host of unintended consequences for private entities and for the future scope of the postal service itself.”

Click here to read the full AFP letter.