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The Path to Sustainability Must Include Breakthrough Innovation

The Path to Sustainability Must Include Breakthrough Innovation
By Bob Levi
NAPS Director of Legislative & Political Affairs

Jim Lovell, former astronaut and commander of the starcrossed Apollo 13, once said: “There are people who make things happen, there are people who watch things happen and there are people who wonder what happened. To be successful, you need to be a person who makes things happen.” His three-member crew conquered crisis with confidence, resilience, ingenuity and vision. They made things happen.

Periodically, Postal Service believers need to assess into which category they fall. Regrettably, some languish in the “what happened” category. As threats revolve around them, they are oblivious to factors that may impact their livelihood.

It is far too easy to be complacent and attend a postal watch party. This is the group with which most associate. They passively observe Congress’ protracted deliberations and are in awe at stark presidential pronouncements.

NAPS members cannot afford willful ignorance or relaxed complacency; there’s just too much risk. Front-line postal managers and supervisors must be engaged and out-spoken in ensuring the continued viability of a universal postal operation.

Consequently, NAPS strives to anticipate legislative and regulatory action and, thereby, helps construct the architecture of the Postal Service of the future. Warmed-over and rejected proposals of yesteryear will not sustain an innovative and vibrant national, universal communications and logistics network. Furthermore, proposing politically untenable policies not only is a waste of time and effort, but undermines the much-needed political good essential to enacting constructive and meaningful postal legislation.

As of the date this issue of The Postal Supervisor (August 2019) went to press, a postal reform bill had yet to be introduced or considered by the House Oversight and Reform Committee. Some members of the committee attributed the delay, in part, to the tardiness of the Postal Service’s anticipated 10-year business plan.

As mentioned in last month’s issue of the magazine, Rep. Mark Meadows indicated he was led to believe the plan would have been submitted back in January. He was livid that the Postal Service was seriously considering reducing delivery frequency as part of the plan.

In late June, the Postal Service briefed a number of postal stakeholders on the principles underlying the yet-to-be-shared plan. A working draft of the plan found its way to the media; in Washington, it’s hard to keep a secret. The leaked plan bears a remarkable resemblance to a postal plan fashioned by McKinsey and Company, a global consulting firm retained by the Postal Service and released by the agency in March 2010. Among the decade-old recommendations were reductions in delivery frequency, eliminating postal-operated retail locations, cutting employee benefits, downgrading speed of delivery and expanding the use of centralized mail delivery. In addition, the 2010 McKinsey report suggested lifting the inflation cap on postage rates, modestly developing new products and services, scraping the retiree health prefunding requirement and authorizing federal appropriations to fortify the Postal Service’s universal service obligation. To paraphrase Ecclesiastes, there’s very little new under the sun.

What is scariest, however, is the 2010 report’s prophetic projection of mail volume. In March 2010, McKinsey, with data provided by the USPS, projected total mail volume would fall from 177 billion pieces in 2009 to 150 billion pieces in 2020. In fact, mail volume hit that number prior to 2017 and, in 2018, the volume fell to 146.4 billion pieces. As a result, it is crucial that whatever legislative scheme is contemplated by Congress or the Postal Service, it must include a robust plan to expand the menu of postal products and services.

Yes, we all agree the retiree health liability must be addressed; yes, we all agree the Postal Service must have more pricing flexibility; and, yes, we all agree that affordable and accessible postal services must be available throughout the nation. However, the path to postal sustainability also must include break-through innovation that will generate sufficient revenue to stabilize postal finances.

The shrink-to-survive mentality is self-defeating and counterproductive. For this reason, NAPS will be aggressive in its pursuit of meaningful, thoughtful and constructive postal reform legislation.

Also in late June, the House passed an appropriations bill that would provide $56.7 million to the Postal Service. Although the bill does not provide these taxpayer funds for postal operations, the legislation reimburses the agency for conveying mail for overseas ballots and mail for the blind.

In addition, the bill prohibits the Postal Service from reducing mail frequency and using appropriated funds to close small, rural post offices. Interestingly, the appropriations committee, in its official explanation of the bill, encouraged the Postal Service to generate additional revenue through “non-postal” products, including installing surcharge-generating ATMs in post offices.

Finally, pending on the Senate calendar are three new presidential nominations to the Postal Board of Governors approved by the Senate Homeland Security and Governmental Affairs Committee. The nominees include Ramon Martinez IV, Ron Bloom and John Barger. They all hail from the financial services sector of the U.S. economy. If they are confirmed, the Board of Governors finally will have a quorum.

It is important to note that for all the foregoing matters, NAPS will be “making things happen!”