Save the Post Office

The Postal Service has already held over 5,400 community meetings for POStPlan, and it has scheduled another 860 for the rest of January and the first week of February.  Within a few weeks, some 6,340 post offices will see their hours reduced to six, four, even two hours a day.  That’s nearly half of the 13,000 post offices on the list. 

The Postal Service began actual implementation of the reduced hours at over one thousand post offices on January 12.  It has scheduled implementation at another 2,250 offices during the rest of January and February: January 26 (944), February 9 (833), and February 23 (475).

The Postal Service has said on numerous occasions that it would implement POStPlan “gradually,” over a two-year period, and it will probably take that long to reduce hours at all 13,000 offices.  But the Postal Service is wasting no time on cutting the hours at the first half of the list.  

A spreadsheet with all the meetings held or scheduled so far is here, a table here, and a map here; the lists come from the USPS website, here.  The implementation list is on the USPS website here; a spreadsheet is here; a table, here; and map, here.

Some 3,100 of the meetings have been held (or will be) at the local post office itself, typically in the lobby.  Since almost all POStPlan offices are small rural post offices, that’s usually meant an uncomfortably crowded space and standing room only, making it difficult to have a meaningful discussion.

Not that it’s really mattered.  The meetings don’t mean much anyway.  Their ostensible purpose is to get feedback from customers about the options on the table — close the office or keep it open at reduced hours — and about their preferences with respect to what hours the office will be open after they’re reduced. 

But the options are meaningless.  Over 99.8 percent of time, the decision has been to keep the office open.  And while customers can use the survey to specify their preferences about the particular hours of operation, by the time the meeting is held (a few weeks after the survey), the Postal Service has already determined what the new hours will be.  

The meeting thus becomes simply an opportunity for the Postal Service spokesperson to explain how much money the agency is losing (always due to the Internet) and to make people thankful their post office is just having its hours reduced instead of closing completely. 

These 6,300 post offices are the first to have their hours reduced because they have a postmaster vacancy.  About 3,000 of them had a vacancy before POStPlan was even announced last year.  Another couple of thousand saw their postmaster retire when the Postal Service offered buyout incentives last summer.  The remainder developed a vacancy when the postmaster transferred to another office, usually to take a spot that opened when its postmaster retired. 

Things have been especially tough for those postmasters who decided to transfer.  They’ve had to sever ties with their communities, say good-bye to customers they've known for many years, and try to explain to them why this is happening.  Many will also need to relocate their families or else face a ridiculously long commute.  This is their reward for their dedication to the Postal Service.

There will be more postmaster vacancies developing as more POStPlan postmasters leave to take new, hopefully more secure positions.  At this point it appears that about 7,000, perhaps as many as 8,000, of the 13,000 POStPlan post offices will see their hours reduced before the winter ends. 

That leaves about 5,000 or 6,000 POStPlan offices where the postmaster is staying put.  They can remain in their jobs until September 2014, at which time they will be released from the Service, and their post offices will finally have their hours reduced.

All of this could change, however.  A few days ago, the USPS Board of Governors directed the Postmaster General to accelerate steps to cut costs and to revisit the five-year plan, presumably to add even more cuts.  Perhaps they’ll find a way to speed up implementation of POStPlan, or maybe they’ll change the criteria and reduce hours even more.  Or maybe they’ll abandon POStPlan and resume last year’s push to close post offices.

PRC Chairman Ruth Goldway has already expressed concern about the directive.  If the Postal Service moves too quickly, says Goldway, "there may be people who are without Post Office access at all."  That could mean that “the quality of service and the Postal Service's obligation to universal service will be damaged in some way.”

Many customers feel that this has already happened.  The news is filled with reports about POStPlan meetings where the public has expressed its anger and frustration toward the reduced hours and the likelihood that the reduction will eventually lead to closure.

In Greenwood, Virginia, for example, the POStPlan meeting was held a few days ago, and the community packed a local church to contest the plan.  Scott Peyton, Greenwood Citizens Council chairman, spoke for many people across the country when he told the Postal Service representative, “Our strong encouragement is to leave us alone.  Our post office operates efficiently, is part of our community, and makes a profit.” 

Peyton complained that the Postal Service wrote the survey for a pre-determined outcome, and he expressed concern that the reduced hours were only the beginning.  “I think it’s a killing-you-softly domino effect,” Peyton said. “They say that they aren’t going to close you, then they take measures that will affect you financially, and then they say that they are going to come back a few years later and review you.”  

“How in the world can our revenue increase if they’re reducing the hours that our window can perform retail sales?” Peyton asked.  “USPS has told us that they don’t have the luxury of looking down the road,” he added. “They’re cutting off their nose to spite their face.”

County Supervisor Ann H. Mallek also had a few words to share with the Postal Service representative.  “You’re making changes universally because it might be more convenient for you and might deliver a short-term success rate, but there’s long-term degradation of services,” said Mallek.  “We are trying to help people succeed and improve their economic prosperity, and we’re being sabotaged by this effort that you all are making to save your own skin….  You’re throwing under the bus this very profitable rural post office.”

Photo credits: Greenwood, VA meeting; Greenwood post office (Google streetviews)

BY MARK JAMISON

The new year has begun, and the country is still waiting for Congress to address the problems facing the Postal Service.  In the meantime, the Postmaster General blames the crisis on congressional inaction and the diversion of first class mail to the Internet.  His solution is to cut services to the public, eliminate jobs, and dismantle the infrastructure he is charged with preserving.  

On January 3, Postmaster General Donahoe released a statement entitled “Congressional Inaction Heightens Postal Service Financial Crisis; More Aggressive Cost Cutting and Revenue Generating Measures Will Be Considered.”   Bemoaning the fact that the 112th Congress failed to act, Mr. Donahoe suggests that “legislation could quickly restore the Postal Service to profitability and put the organization on a stable long term financial footing.”

Mr. Donahoe goes on to point out the Postal Service had to default on payments to the retiree health benefit fund (RHBF), and he repeats the unsupported canard that the Postal Service is losing $25 million per day.  That bit of sophistry overlooks the fact that most of the losses can be attributed to accounting gimmicks forced on the Postal Service by Congress. 

The Postmaster General and Board of Governors can't control what Congress does, but they have added to the Postal Service's financial problems by engaging in a direct campaign to undermine the viability of first class mail through extreme service cutbacks and a constant drumbeat of panic and doom.  In his Jan. 3 statement, Mr. Donahoe actually celebrates the loss of 60,000 postal jobs, the degradation of a large part of the postal network, and reductions in service to many communities throughout the nation.

In his book At Any Cost: Jack Welch, General Electric, and the Pursuit of Profit, Thomas F. O'Boyle paints a picture of a corporate executive so committed to the soulless pursuit of profit that he would do anything to improve the bottom line and push up the value of GE stock.  In his closing chapter, O'Boyle poses a simple question that we would do well to ask of the Postal Service: “Do businesses need a soul to succeed  — a sense of purpose beyond just making money?”

The narrow field of debate

The discussion over the future of the Postal Service has been carried on over a fairly narrow field.  Postmaster General Donahoe and the Postal Board of Governors argue that the fiscal difficulties of the Postal Service arise from the regulatory structure imposed by Congress.  If the Postal Service is liberated from the shackles of regulation, if it’s free to compete, then it can succeed.  While Mr. Donahoe acknowledges that the RHBF mandate is a significant impediment to the financial viability of the Postal Service, his argument is much broader, contending that the Postal Service must be freed from regulatory restraints like the universal service obligation.

Many in the mailing community, particularly the component of the industry that focuses on advertising, appear to agree with a great deal of what Mr. Donahoe says.  They see the potential for cheap mailing rates if the Postal Service could shed much of its responsibility to rural America.  They also see the abrogation of labor relationships as a potential boon to their interests.  The mailing industry holds a view that is essentially that of American industry in general over the past thirty years — reduce costs, liquidate or outsource labor, and maximize profit at the expense of all other considerations.

Most of those who disagree with Mr. Donahoe’s vision do so on what amounts to a very limited basis.  The unions and other employee organizations disagree with Mr. Donahoe’s tactical approaches to defining the Postal Service’s future, but they generally agree that the Postal Service must compete, that success will be achieved by accepting some of the regulatory strictures imposed on the Postal Service while loosening others, presumably maintaining those things which benefit labor while permitting behaviors that will enhance and increase revenues.

The politicians line up on the issue according to their ideological predispositions.  So, many of the Republican politicians advocate for a Postal Service that moves more towards a privatized, lightly regulated model, one that more closely follows the model of the last thirty years of seeing value only in terms of maximized profits.  Most of the Democrats appear interested in protecting their traditional constituencies in labor, but they also use the word “compete” as if competition, or what is often termed competition but is actually something much different, i.e. deregulation, will magically provide answers to all questions.

The unfortunate fact of the matter is that the discussions over the future of the Postal Service represent a concrete example of how stilted and narrow our economic discussions have become generally.  We have become so enamored over theories of efficient markets and the value of unbridled competition that we have excised broader views on what makes for both a healthy economy and, more important, a healthy society.

BY GRAY BRECHIN

The National Academy of Public Administration has released a “Work-in-Progress” report entitled "Restructuring the U.S. Postal System: The Case for a Hybrid Public-Private Postal System."  The Academy is now embarking on a study of this proposal, which would privatize a large portion of the country's postal system.  

The Academy's study is billed as an “Independent Review of a Thought Leader Proposal to Reform the U.S. Postal Service.”  Unfortunately, no study conducted by a four-man panel chaired by David M. Walker, the former President and CEO of the libertarian Peter G. Peterson Foundation, can seriously claim either the independence or non-partisan objectivity that the Academy itself boasts.   

It has been my experience over the past 30 years that "hybrid public-private partnerships" are often little more than a sedative euphemism for the private sector taking the profits while the public bears the costs.  Such is the case with this "reform,” which will, as is so often claimed in such instances, "unleash the power of market forces" by transferring the USPS profit centers to the private sector while saddling the public with the cost for "the last mile."  Meanwhile, the public is already being stripped of its assets in broad daylight while the media sleeps.

The proposal is predictably one-dimensional — as befits men who seemingly have little or no sense of the public service mission for which the Post Office was created 238 years ago under the direction of Benjamin Franklin.  Its purpose, then as now, was democracy and equality, not efficiency or profit. Thus, the report omits much. 

Nowhere in the proposal is there any mention of unions, let alone of living wages, so one can only presume that a primary means of reducing costs will be to drive down the income of those postal employees who remain after the USPS is radically downsized and diminished as proposed.

The report also simplistically states that "the root cause of the postal crisis is the historic change in how we communicate," omitting other forces now undermining it such as Congress itself.  Nor does it mention the invaluable artistic, historic, social, environmental, and commercial function of many post offices currently being thrown onto the market with virtually no oversight.  It neglects to say that a commercial real estate firm (CBRE) chaired by Senator Dianne Feinstein's husband, Richard Blum, is profiting from the sale of properties paid for by taxpayers for well over a century. 

Finally, there is no serious discussion of alternatives characteristically described in such reports as “out of the box” for making the USPS solvent again, such as reviving the U.S. Postal Savings Bank and providing other public services currently available outside this country. That is because the self-proclaimed thought leaders who framed the report do not actually seek to save the Postal Service but to “reform” it virtually out of existence.

My studies of the New Deal have revealed an ethos of public service that seems entirely alien not only to the men who produced the Academy’s blueprint but to current postal management as well as to those in Congress who saddled the USPS with fiscal obligations seemingly designed to eliminate it as a competitor to private carriers, a goal long sought by those very carriers and by the libertarian think tanks they lavishly fund.

Several WPA-built structures here in California bear an inscription by the Roman poet Virgil: "THE NOBLEST MOTIVE IS THE PUBLIC GOOD."  The Academy’s preliminary report contains nothing noble or new.  Quite the contrary, it is yet more of the same demonstrably failed neoliberal experiment that has, over the past three decades, so disastrously despoiled the U.S. economy as it has demoralized our citizens.

Unleashing the power of market forces did not work so well in 1929 or in 2008, and it will not do so again as those very forces seek to finish off the public sector as a competitor once and for all. 

Dr. Gray Brechin is the author of Imperial San Francisco: Urban Power, Earthly Ruin. He is the founder and project scholar of the Living New Deal Project based at the U.C. Berkeley Department of Geography.  He works with others to stop the sale of the National Register-listed Berkeley Post Office. 

Photo Credits: David M. Walker; Dr. Gray Brechin (Steven Finacom)

The Postal Service continues to close post offices by emergency suspension over problems renegotiating leases.  Many of the problems are caused by the Postal Service.  A suspension is an easy way to close a post office — it avoids a lengthy discontinuance process and the possibility of an appeal to the Postal Regulatory Commission, and it makes it look like the closure is the landlord's fault.

In its annual compliance report to the PRC, issued just a couple of weeks ago, the Postal Service said it closed 237 post offices in fiscal year 2012.  Nearly all of those closing occurred in October and November of 2011, before the moratorium on closures began in December.  Since then, formal discontinuances have come to a virtual halt.  But the emergency suspensions continue.  The compliance report says that at the end of FY 2012 (September 30, 2012), there were 124 suspensions in effect. There have been several more suspensions since then.

Many of the suspensions have occurred because the Postal Service, or its real estate agent CBRE, put unacceptable demands on the landlord, like a large rent reduction (as much as 30 percent) or an early-termination clause.  So whenever a post office’s lease is coming to an end, it’s at risk for an emergency suspension.  During the first six months of 2013, nearly 1,900 post offices will have a lease expiring.  A list is here, a table here, and a map here. 

About 850 of these offices are on the POStPlan list and set to have their hours reduced.  While POStPlan has been advertised as the Postal Service’s plan to save post offices, that doesn’t mean it won’t suspend a POStPlan post office.  There have been numerous POStPlan offices closed by suspension over the past few months.

In its advisory opinion on POStPlan (August 2012), the PRC expressed concern that post offices would be suspended because of staffing issues and lease problems, but the Postal Service reassured the Commission that it “has no plan for using the lease negotiation process as a pretext to close Post Offices.” 

The Commission hasn't had much to say about suspensions since then.  In its annual report, issued just a few days ago, there’s a section on post office closings and appeals but no mention of “emergency suspensions."

The early-termination issue

Many of the post offices with leases expiring soon have already had a successful lease negotiation, but in most cases, the negotiations are ongoing.  The Postal Service has been cutting it close.  In years past, a lease was negotiated many months before it expired.  These days, the negotiations are often completed with just a few days left on the lease, sometimes even after an emergency suspension has been announced.

The Postal Service and the landlord may disagree over a number of issues, like the amount of the rent or responsibility for maintenance, but the issue that is causing many of the lease problems these days is the Postal Service’s insistence on adding an early-termination clause to the lease.   This clause permits the Postal Service to end a lease whenever it wants, and on relatively short notice too. 

Traditionally, the Postal Service would sign a five- or ten-year lease with an option for another five years.  The fact that the building would house a post office for a long time was one of the main reasons why investors got into the business of owning post offices in the first place.

Now the Postal Service wants to insert early-termination clauses in the leases, giving it the option to get out before the five years are up, sometimes with as little as 60 or 90 days notice.  These termination clauses have been the source of a lot of controversy, and the lessors have complained vociferously to the Postal Service and the PRC about them.

Because of all the complaints over the termination clause, the Association of U.S. Postal Lessors (AUSPL) got the Postal Service to agree to make the shortest termination clause 30 months.  In other words, the lease may not be terminated for the first two years, and after that the Postal Service needs to give 180 days notice. 

The termination clause makes it impossible for lessors to make long-term plans for their buildings.  They are put in an untenable position — accept the clause or lose a tenant — so it’s no surprise that lease negotiations have been breaking down. 

But that’s apparently fine with the Postal Service.  After all, if it had long-term plans to keep the post office open, why would it be insisting on the termination clause in the first place?  

Closed for a quarter in Climax

The post office in Climax, Georgia, was on the POStPlan list, set to be reduced to six hours a day, but on October 31, 2012, the Postal Service suspended operations due a problem negotiating a new lease.  The Postal Service should have looked around for another suitable location. There should have been several possibilities.  After all, the Postal Service cited lower average rents in Climax as justification for a big rent reduction.  But rather than finding another location, the Postal Service initiated a discontinuance feasibility study — the day after the suspension went into effect.

The case is currently being appealed to the PRC.  The Postal Service has filed a motion to dismiss the appeal on the grounds that the post office has not yet been discontinued — it’s just under emergency suspension and only being studied for a discontinuance — so an appeal is premature. 

The PRC’s Public Representative, who can usually be counted on to advocate on behalf of the community, has recommended that the case be dismissed for precisely that reason.  It’s almost inevitable that the PRC will dismiss the case, just as it has in previous cases where an appeal was filed while the post office was suspended but not yet discontinued. 

The Public Representative seems to think everything is fine in Climax. “Because the Postal Service has promptly initiated a discontinuance feasibility study,” writes the PR, “it does not appear that the Postal Service is keeping the citizens of Climax in limbo or abusing its suspension procedures.”  The folks in Climax and the landlord of the building probably have a different opinion on that subject.

In the materials submitted by the Postal Service, there’s a copy of the letter it sent to Climax customers.  The Postal Service explains that it wanted the landlord to drop the rent from its current $11.84/sq.ft. to $8.50/sq.ft., which it considered “fair market value,” with a 60-day termination clause.  The landlord offered to accept $8.75/sq.ft., with no termination clause, but the Postal Service rejected the offer.

The Climax post office was thus closed over a matter of 25 cents a square foot.  The landlord was willing to reduce the rent from $1,831 a month to $1,353 a month, but the Postal Service wanted $1,315 a month.  They were $39 a month apart when the deal collapsed.