The USPS is a Major American Economic Asset – Time to Start Treating It Like One!

The ongoing debate about the United States Postal Service (USPS) ability to deliver absentee ballots and election materials in a timely fashion is truly a “double edged sword” for our country. While the politicization of USPS delivery capacity and ability to support the time requirements of the election has exposed yet another political fault line in our society, it has provided a golden opportunity for all of us to look more closely at the USPS, think about the importance of the USPS to all elements of our society, and most importantly, support the actions that are required to modernize the operation and return it to financial stability. 

First things first! The USPS will have no problem handling the influx of mail volume caused by an increase in “Vote by Mail” for the election this fall. Year in and out, the USPS processes billions of pieces of mail. In 2019, 142.6 letters in all classes of mail were picked up, sorted, and delivered to their final destinations. While that is an impressive number, the COVID-19 pandemic has significantly reduced mail volume through the first 3 quarters of 2020. The USPS recently released its April 1-June 30, 2020 quarterly financial results. Compared to the same quarter last year, Marketing Mail declined by 6.4 billion pieces or 36.4%. First Class Mail declined by 6.4% or 1.1 billion pieces. This report confirms what we all experience at the mailbox on a daily basis during the pandemic; mail volume is still way down, and we should expect it to remain so for the foreseeable future.  

So the message is, with the existing incredible ability to move mail and significantly decreased current volume, the USPS will have ample capacity to handle the increased volume due to voting by mail, even with some of their older equipment taken offline. By way of comparison, in 2019 the Postal Service handled 2.5 billion pieces of first class mail, or 500 million pieces per day, in one week alone, the week before Christmas. For argument’s sake, let’s assume that all 153 million registered US voters do vote by mail for the upcoming election. That would be approximately 306 million new pieces of mail entered into the mail-stream over the next 2 months, an increase that would barely be a discernible uptick to the USPS mail processing system. Of course, not everyone will vote by mail but it is important for any individual considering it to understand the time requirements to request and return their ballot. Contact your local Board of Elections to learn more.

The Postal Service is so ingrained in our society that many of us take it for granted. In reality, the USPS has been, and continues to be, a vital component in the US economy. The Postal Service is a key partner to the Paper/Print/Mail segment of our economy which is comprised of a variety of sectors including retailers, marketers, catalogers, direct mailers, printers, publishers, paper manufacturers, and more. Collectively, these companies employ over 7.5 million people in well-paying jobs that pay mortgages and taxes and put children through school. The Paper/Print/Mail industry is responsible for $1.6 trillion of economic activity each year. Over 50 percent of the annual print output in the United States ends up in the mail stream. Targeted print is the most effective delivery mechanism for marketing messaging. Printed communication is the only media whose economic ROI can be directly measured in dollars generated and is the most trusted, most secure, least hackable, and least intrusive method of communication that we have. In addition to business communications, the USPS is a lifeline for many of our citizens, delivering important services and communications to our elderly and rural residents. It’s important to recognize that 44 million of 157 million USPS delivery addresses are located throughout sparsely settled rural areas. No private sector shipper would choose to serve our entire country and take on its great challenges to earning a profit, but the Postal Service does. The USPS enjoys wide job approval and is the most popular federal agency with the American public. The USPS is the backbone of our democracy.

It is no secret that the USPS has struggled financially over the recent past. Diminished mail volume and legacy structure and cost issues are pushing the agency to insolvency. Despite the universal recognition of the important role that the USPS plays in the American economy and society, there is no appetite in Washington to take the necessary steps to repair this key asset. It is like owning an older home with an outdated electrical system but waiting for the inevitable fire to fix it.

Earlier this year, Joel Quadracci, CEO of Quad/Graphics, one of the major printer/mailers in the country, provided testimony to Congress on behalf of his company and the printing industry. The key messages Mr. Quadracci delivered in his testimony focused on practical steps Congress can take to allow for financial stabilization of the USPS. These include legislative reforms addressing health care costs of USPS employees and retirees, the untenable burden of aggressive overfunding of retiree benefits, and ensuring that the Postal Rate Commission takes into account the financial improvement of USPS post-legislation as it considers postal rate adjustments.

Just as importantly, Mr. Quadracci highlighted the commerce aspect of the postal reform issue. The explosion of e-commerce package delivery and associated multichannel marketing along with innovations to increase the value of direct mail means this sector is viable, but it needs business certainty and postal rate affordability. Bipartisan postal reform legislation can help bring about these outcomes in the short-term and will stabilize the Postal Service so that innovations and structural reforms may be considered in the future.

In closing, the USPS provides a valuable service, even more so with its key role in supporting this fall’s election in the midst of a pandemic. The Service is well positioned to handle any volume of election mailing required along with its usual duties. Congress was empowered to establish the Postal Service in the United States Constitution. It’s time for our government (and us for that matter) to recognize the importance of the Postal Service to our country, understand the problems it faces, and fix them! Immediate assistance from Congress and the White House is needed to return the USPS to financial stability! The USPS problems are solvable but not without public demands for legislative leadership and action. There are legislative solutions already in place for both short term COVID-19 relief and a long term solution, but we need to tell our elected leaders to step up and do something about it.

It is hard to envision what our lives would be like, both personally and economically, without the United States Postal Service. The time to act is now-

 Click here to send a message to your US Congressional Representatives and ask them to support the POSTAL SERVICE EMERGENCY ASSISTANCE ACT (S. 4174)

Also visit The Coalition for a 21st Century Postal Service at www.21stcenturypostal.org to learn more and send a message to your US Congressional Representatives.

Regards,

Tim Freeman, President
Printing Industries Alliance
tfreeman@PIAlliance.org
Office: (716) 691-3211
Cell: (716) 983-3826

 

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