06 December 2011


The US Postal Service announced yesterday that in order to address increasing losses of revenue (ostensibly caused by more people sending mail and bill payments online), it plans to institute draconian measures to cut costs. They include ~

~ eliminating next-day delivery for first-class mail.

~ shutting about half of its 487 mail processing centers nationwide, which would entail firing about 28,000 postal workers.

~ closing as many as 3700 of the nation's 32,000 post offices. Most of these will be rural. Above is a map of the projected 85 post office closures in Montana alone. For reference, the state is about 500 miles east to west, and 300 miles north to south, with roughly 1 million residents. Can you imagine how many will be affected if the USPS has its way?

~ reducing mail deliveries from six days a week to five.

~ cutting the overall postal work force of 653,000 employees by more than 100,000.

The USPS has annual budget costs of about $75 billion, and last year spent $5.1 billion more than it brought in. The impact of the Internet, as well as parcel delivery competition from FedEx and UPS, are part of the story. This writer contends that rigid thinking by USPS management is also responsible. It is ridiculous and short-sighted MBA thinking to propose that any business or government agency can cut costs by eliminating service and firing employees. How many scores of times have we heard that refrain during the past decade or two, from companies which subsequently failed because the reduced service they offered actually drove customers away?

I grew up in small towns where the post office was (and remains) the community's lifeline to the outside world, as well as a place to socialize. In MBA terms, it may make sense at first glance to close a tiny branch which serves only a few hundred residents. But that means those residents must then choose between traveling 10-50 miles to the nearest intact post office branch, or go without mail entirely. There is a place in this world for BOTH mail service and Internet service.

Further, many of the intended closures are not in tiny communities. One of the mail processing centers on the chopping block happens to be right here in Missoula, MT ~ a community of nearly 70,000 residents which also serves as a mail hub for double or triple that number in surrounding towns. To close distribution centers in the West, where they are already spaced hundreds of miles apart, will disrupt the lives of people and businesses to an unconscionable degree.

The answer in the short term is for the President and Congress to agree to fund the USPS shortfall. $5.1 billion is a drop in the bucket, not even equal to the money spent during one day in the misguided war in Afghanistan. Over the long term, USPS management should be replaced by more creative individuals who understand how to streamline service without eliminating it. It's not rocket surgery. If USPS is serious about competing, they should be looking for ways to IMPROVE service. And the answer is decidedly NOT to privatize the postal service. That is shorthand for providing some entrepreneur with a handsome profit, while the customer pays more for less service.

Ben Franklin, the first US Postmaster in 1775, must be rolling over in his grave.

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