Anyone marginally aware of the battle over the federal debt limit is seeing the consequences of an unfortunate American (or, perhaps more fairly, human) trait: wanting what they want but being less willing to pay for it. Services and benefits are great, but paying for them through taxes isn’t.
Perhaps on a smaller scale, but the same irony applies very well to postal customers and the Postal Service, particularly at the present time, when the agency is suffering from sharply reduced volume and revenue and is looking for every opportunity to reduce its costs.
Delivery when and where I want it
Just as some citizens still believe that tax dollars support USPS operations, it’s likely that some people believe that six-day-a-week delivery is provided for in the Constitution. And for many Americans, “delivery” means putting the mail in a receptacle in, on, or near their front door. As a result, the possibility that the Postal Service could stop delivering on Saturday, or to their door, or both, is a disturbing threat to what they believe is a virtual birthright.
Of course, providing that level of service is expensive, so the Postal Service sees a huge opportunity to cut costs by dropping a delivery day or moving to more efficient delivery methods. Depending on whether you believe the Postal Regulatory Commission’s bean counters or the Postal Service’s, the move from six- to five-day delivery could be worth more than $3 billion.
Eliminating Saturday delivery is either a big deal or a nonevent, depending often on how much mail of what kind is involved, where the recipient lives, and the person’s age. People who live in urban or suburban settings and are children of the digital age likely get bills and personal messages electronically and so will have little passion about retaining Saturday delivery. Conversely, persons who live in rural areas, depend on the mail for messages or parcels, and favor paper-based communications probably will have concerns about losing Saturday delivery.
However, the Postal Service is handling and delivering less mail while the number of possible delivery points is increasing, i.e., its revenue per delivery stop is declining while its costs per stop are rising. At the same time, the less mail-dependent segment of the population (who could accept no delivery on Saturday) is growing while the mail-dependent segment is shrinking. In sum, there’s going to be less and less mail to pay for a level of delivery service that fewer and fewer people will expect, and those who don’t want such service are not going to like having to support it.
And then there’s door delivery. If the USPS Inspector General is right, transitioning from door delivery to curbline or, ideally, centralized delivery, could yield between $4.5 billion and $9.6 billion is savings. But who will give up door delivery and put up a mailbox at the curb? Better yet, what street will be the first to volunteer to take down its mailboxes and accept a neighborhood delivery and collection box unit? Making Americans start walking to the curb – or farther – for their mail is not a concept likely to win wide endorsement, no matter how much ending door delivery might save the USPS.
Keep my little post office
A corollary birthright in the mind of many Americans is their local post office. Whether classified by the Postal Service as a “post office,” “station,” or “branch,” the familiar retail outlet is often perceived as something more than just a place to buy stamps. Instead, communities attribute to their post offices qualities and roles that have nothing to do with postal services or access to them. As a result, when the Postal Service tries to manage its retail network with any degree of business logic, it runs up against irrational and emotional arguments that often trump whatever actions good business sense would dictate.
The simple fact is that the agency has an inefficient brick-and-mortar retail infrastructure in an era when other forms of access can be just as effective in enabling customers to obtain and use USPS services. The postal retail network includes old buildings, outlets in the wrong places, and offices that are ludicrously unprofitable. In most cases, these facilities’ postal purpose could be served just as well and more economically if access to postal services were imbedded within the operations of an existing retail establishment with whom the USPS could partner, or through on-line portals, carrier service, kiosks, and other alternatives. The average APC (Automated Postal Center kiosk) already generates more revenue than any of the 19,000 smallest post offices – and APCs can be installed just about anywhere.
Some argue that closing post offices doesn’t make an economic difference, asserting that the smallest one-third of post offices represent less than 1% of overall USPS costs. However, even if that’s correct, given that the USPS will run up over $68 billion in expenses this year, “less than 1%” could still be over $600 million, a lot of money for an agency trying to make ends meet.
But alternatives aren’t what Americans want; they want their familiar, convenient, traditional post offices. And the best evidence of this is the stream of tearful appeals to the PRC as post office (or station or branch) closures are being pursued by the Postal Service. There’s even a website (SaveThePostOffice.com) dedicated to blocking the closure of post offices, not for business reasons, but because of all the other non-postal qualities to which customers attach. An example reported on that website is the comments made during a meeting at which the Postal Service explained its plan to close the post office in Etna (NY) and gathered community response.
“They didn’t like the idea of mailboxes – the snow plows knock them down – or cluster boxes either – they freeze up – and neither has the security of a post office. And they didn’t like the idea of driving three miles to the next-nearest post office in Freeville. And they didn’t like losing a place that’s been there for their whole lives, a place many can walk to, a place where they chat with neighbors, a place that helps give identity to the town.”
Such comments are not unique, as anyone who reads the appeals to the PRC can attest. Just about every appeal cites inconvenience, loss of community identity, and dissatisfaction with losing a familiar resource. Also, for obvious reasons, the postal labor unions and the postmasters’ associations oppose closures, adding that the law prevents closing post offices for economic reasons, and that service to customers of underperforming offices is just as important as to customers of offices that generate a profit.
For its part, the Postal Service tries, as is its duty, to mitigate the impact of a closure, including allowing the continued use of the closed PO’s name in addresses, but that’s seldom enough. People want what they want, and don’t care how much it costs or who’ll pay for it.
You don’t always get what you want …
However, are the reasons usually cited in appeals really relevant to the core issue? If the Postal Service is supposed to provide universal service, including nationwide access to postal services, and if it’s supposed to be operated in a businesslike manner, is it also to be expected to retain operations and facilities not essential to meeting that obligation simply for the emotional and social satisfaction of customers? If postage revenue is to be the sole source of support for the provisioning of postal services, where in the many statutes bearing on the agency does it say that “postal services” include providing a social center, for example, or preserving citizens’ sense of “community.”
And, if access to USPS services is to be assured to all, must that be achieved without reasonable regard to cost, or to the availability of suitable alternatives? Must physical USPS post offices be retained in locations where a kiosk or counter in a grocery store would allow equivalent access at less cost? Is driving two or five or ten miles to a “real” post office (if that’s essential) too far, even when other services (like grocery or department stores) are farther?
In the end, the question is simple: Who will pay to support these beloved facilities? Commercial ratepayers, who contribute the lion’s share of postage revenue, expect the Postal Service to operate efficiently and trim needless costs, so they’re disinclined to cooperate with those more focused on the “soft” reasons for keeping unnecessary facilities. Retail customers, typically senders of single-piece First-Class Mail and parcels, are generating less revenue as successive generations eschew paper-based communications and favor postal competitors. And, Congress, who clearly can’t reach a logical, apolitical consensus, cannot be looked to for help, as its record of inaction already shows.
Whether in appeals, reports on websites, or decisions on appeals by the PRC, nowhere does anyone opposed to closures explain how to pay for all the facilities that they believe should be preserved. More economical, and arguably more accessible, alternatives are rejected in favor of keeping the little building at the center of town where neighbors can meet and chat. Who’s paying for the convenience of having it, and for its maintenance and staff, isn’t considered. It’s just what people want; resting their case on the USPS being a service, they ignore any awkward question of how it’s to be financed.
But the financial condition of the Postal Service no longer comports with such largesse, and demands that steps be taken to align revenue and cost, and the methods of providing service with customer demand and buying behaviors. Moreover, circumstances require that resources be optimized, i.e., that outlets reach the most customers with the most services for the lowest cost, even if that means some customers in some places don’t get to keep the conveniences they’ve enjoyed in the past – but not adequately supported.
Paying for what you want
Of course, just as many postal rates are pegged to worksharing by the mailer, the retention of a place’s redundant post office could be linked to how much that place is willing to underwrite it. Ratepayers pay postage generally proportional to the “value of service,” to how mail is prepared, and how its entered; those who do more pay less, and those who do little pay more. Accordingly, if Podunk wants to keep its post office, even though it loses money, is two miles from another post office, and could easily be replaced by a counter at the supermarket, why shouldn’t Podunk pay for it? Just as producers of efficient mail don’t subsidize those who produce mail that’s more costly to process, it may be time for patrons who want to keep expensive access to USPS services to pay for it, and not to expect the associated costs to be absorbed by other postal customers content to accept alternative forms of access.
Though such a pay-for-what-you-want approach may seem equitable to some, it likely could never overcome the howls of politicians and others carrying the concerns of America’s Podunks. Those who allegedly would be disadvantaged if they didn’t have their local postal outlet just as they want it have plenty of sympathizers among the socially liberal on the PRC and in Congress (and with the postal labor unions and postmasters associations) – none of whom, incidentally, are responsible for figuring out how to pay for such benefits.
The politically astute, socially sensitive, or self-interested simply don’t want to deny citizens a level of service and convenience they’ve come to expect but that, unfortunately, the Postal Service can no longer afford. None of them is keen to ask postal customers if they’d pay for what they want – benefits they gladly accept so long as they’re paid for by someone else. – L Raymond