Tuesday, September 6, 2011

Dinosaurs Walking

Today, we find out just how bad things are for the US Postal Service.  By all accounts, the USPS is on the verge of insolvancy--unable to make a $5.5 Billion payment to its retirees if Congress doesn't provide a major bailout--and approve reduction in services. 

According to the New York Times, personnel costs account for more than 70% of the Post Office's operating expenses.  That compares to less than 50% for its main competitors--UPS and FedEx.  If you consider the average public sector employee's health insurance plan to be a "Cadillac"--then the folks at USPS have the "Bentley" packages--and you can imagine what that costs.

So Postmaster General Patrick Donahoe heads up to Capitol Hill today to propose a solution: a big federal subsidy, cutting Saturday delivery, closing smaller post offices and combining sorting facilities across the country.  Sounds like a good plan--considering the sharp reductions in mail volume in the electronic age.  But here comes Cliff Guffey--the head of the American Postal Workers Union--to derail the whole thing.  Guffey points out their contracts have no layoff guarantees in them (there is a fine example of long-sited negotiation). 

Guffey is backed by the head of the Association of Letter Carriers--Frederic Rolando--who predicts "disaster" if service is cut back.  The Times quotes Rolando as saying "This is about one of America's oldest institutions.  It survived the telegraph, it survived the telephone and we have to do everything we can to preserve it and adapt."

So Mr. Rolando, did AT&T continue to operate telegraph offices in every town and city across the country when people stopped sending telegrams?  Were there protests in the streets when those telegraph offices closed?  Does AT&T still have operators in every town and city to work switchboards--helping to connect landline phone calls?  If everyone dumps their landline phones someday and goes exclusively to cell phones, will AT&T continue to spend billions to maintain phone lines and poles?  Of course, the answer is "NO" because AT&T was willing to adapt to the changing times--and provide services that people actually wanted.

The time has come to admit that the Postal Service is a dinosaur still roaming the earth.  Unless there is a major devolution of technology on the horizon, it will become as relevant to our lives as the telegraph and the printed newspaper.  Now is the time to plan for a graceful (and economical) demise.

1 comment:

  1. Johnathan,
    You have it ALL wrong!!! The Postal Service is NOT a company. It is a service. We are required by LAW to deliver to everyone every day. Our finacial wowes are due to the over payment for retirees(75 billion in the CRCS retirement and 6.9 billion in the FEERS retirement systems) + the 54.8 billion that we must pay for future retirees. Something that no other company or government section has to pay.Give the post office back this money.....and we are just fine. The truth is the fact that the post office for years and years has been a cash cow for the government.
    Do your research and you will see how we have been forced to give our profits to the government. We take in NO tax dollars to run this service. But we are regulated to do things that another company would not do. Like free mail service for the blind, nonprofit rates, free mailing for congress. Deliver to nonprofitable areas. Ask Fedex or UPS if they deliver to all- the answer is no! In fact both come to us with mail and pay us postage to deliver pacels that they won't deliver. So I suggest that you "read" up alittle on the facts before you bash the postal service Johnathan.