Do you wonder why Louis DeJoy, a major Trump donor, is still Postmaster General of the United States Postal Service (USPS) under the Biden administration? DeJoy’s actions under the Trump administration certainly looked like an attempt to undermine mail-in voting, a storyline entirely in keeping with Trump’s Big Lie that his election loss was a fraud. One might imagine DeJoy remains at his post just because the Biden administration has dozens of bigger fish to fry at the moment, like dealing with the pandemic and its economic fallout. The real story is more complicated. Trump didn’t have the direct power to appoint his major donor as Postmaster General, nor does Biden have the direct power to fire him.
The story of the USPS is itself more complicated than is widely appreciated. I once chatted with my mail carrier about my efforts to tell advertisers to quit wasting paper and energy sending me circulars that I immediately pitch into the recycling bin. Her response took me aback. “Don’t do that!” she said, “If we didn’t have advertisements to deliver I wouldn’t have a job!” It was a vivid reminder for me of how things have changed.
I came upon the following article in the March 16, 2021 Washington Post. I reproduce it here partly as an advertisement for the clarity articles in the Post often bring, and partly because, amid all the other things one might read, this might easily have been missed. (Note: if you have a WaPo subscription or haven’t yet read your free monthly article limit, click on the title below to read. There are some useful illustrations that did not copy well. Better yet, sign up for a subscription.)
Keep to the high ground,
Jerry
What you should know about USPS — and how it descended into crisis
By Jacob Bogage
Postmaster General Louis DeJoy is expected to roll out his plan to reshape the nation’s mail service, making a deeper imprint on a government agency that has weathered a pandemic, a historic election and a crushing holiday season during his brief tenure.
The blueprint is sure to cause further delivery slowdowns — DeJoy said as much during a recent hearing on Capitol Hill — at a time when the U.S. Postal Service already is recording some of its worst performance metrics in generations. Cost-cutting measures the postal chief implemented over the summer have been blamed for much of those declines.
But the agency — along with DeJoy’s role — is widely misunderstood. Here’s eight common misconceptions:
FALSE: DeJoy was appointed by Trump
One of DeJoy’s habits in congressional testimony is to remind lawmakers that he was appointed not by then-president Donald Trump, but by the Postal Service’s bipartisan governing board. That’s true, but it’s more complicated than that.First, DeJoy was appointed by the board of governors, whose members are nominated by the president, confirmed by the Senate and are supposed to run the Postal Service as an independent agency. But the Trump administration had an outsize, unprecedented — and as numerous experts claim, improper — role in shaping postal leadership.
Trump has falsely claimed that the Postal Service undercharged express package carriers, namely Amazon, whose founder, Jeff Bezos, owns The Washington Post. Trump assigned his treasury secretary, Steven Mnuchin, to look at overhauling the Postal Service. Mnuchin then used its deteriorating financial condition to edge out then-Postmaster General Megan Brennan and compel the board of governors to select a Trump loyalist to replace her, The Post has reported.
The board chose DeJoy, a former supply chain logistics executive and major Trump donor. He had not been identified for the role by either of the two executive search firms the governors hired to find candidates. Then-Board Chairman Robert M. Duncan, a former Republican National Committee chair, submitted DeJoy’s name for vetting, Duncan told a House panel in August. DeJoy took office in June.Second, the board is indeed bipartisan, but to some, in name only. The board was empty when Trump took office, and he appointed every sitting governor: four Republicans and three Democrats. When DeJoy was hired, only three Republicans and two Democrats held seats. Before the governors could vote to hire DeJoy, Democratic Vice Chair David C. Williams resigned, upset, according to people familiar with his thinking, over the Trump administration’s meddling and the board’s obsequiousness. The board held the vote and DeJoy was hired.
TRUE: Biden can’t fire DeJoy
Democrats have been howling for DeJoy’s ouster since he started, and those calls have only intensified since President Biden’s inauguration. Many have appealed to Biden to remove DeJoy on his own. But it doesn’t work like that. Just as DeJoy was hired by the governors, he can only be fired by the governors.
Biden inherited a USPS crisis. Here’s how Democrats want to fix it.
Biden can, however, fire governors, but he has to show “cause,” a concept whose meaning in this context is nebulous. Does “cause” mean the governors have to do something wrong? Or does it mean that they have ideological disagreements with Biden about the mail? Regardless, Biden has signaled he’s not likely to go that route. He announced plans last month to nominate two Democrats and a voting rights advocate to fill the remaining three open seats on the board, giving Democrats and Biden appointees a majority with enough votes to remove DeJoy, if desired.
FALSE: The Postal Service bungled the election
Actually, the Postal Service did its job during the November general election and the Georgia Senate runoff in January. The agency delivered 135 million ballots to or from voters in the Novembercontest, according to its post-election report, and 97.9 percent of ballots were delivered on time, or within three days. On average, the Postal Service reported, it took 2.1 days to deliver ballots from election officials to voters, and 1.6 days for completed ballots to reach vote counters.So why, folks often ask, did it take days and days to get the election results in states like Michigan, Wisconsin, Pennsylvania, Georgia and Arizona?
Two main reasons:
In Michigan, Wisconsin and Pennsylvania, state election officials raised alarms with legislators months ahead of the November vote about potential problems. Ballot acceptance deadlines in those states didn’t necessarily line up with mail service. In some cases, vote counters were not allowed to start counting ballots until the day of the election, even if mail ballots came in days or weeks ahead of time. Officials asked all three GOP-controlled state houses to pass laws to make things easier. All three state legislatures declined. So theprocess took longer.
In Georgia and Arizona, the answer is more simple: It was a close race! Biden won Arizona by fewer than 10,000 votes, and Georgia by fewer than 12,000 votes. In races that tight, it takes a while to make sure all the counts are accurate.
FALSE: DeJoy removed sorting machines and mailboxes to make it harder to vote
The root of this claim, which took hold over the summer, is linked to Trump’s constant attacks on mail-in voting and DeJoy’s connections to Trump and Republican causes, to which DeJoy has given more than $2 million since 2016, according to the Federal Election Commission. DeJoy has not made any donations reported to the FEC since taking office.So when the agency started dismantling high-speed sorting machines and removing public mail collection boxes shortly after DeJoy took office, many Democrats accused DeJoy of tinkering with postal infrastructure they saw as vital to the election.
Here’s why the Postal Service wanted to remove hundreds of mail-sorting machines
The truth is that the Postal Service had long planned to remove collection boxes and sorting machines, though that program accelerated under DeJoy, according to an inspector general report. Commercial mailers had for years complained about overcapacity in the Postal Service’s network — that the agency had too many machines to maintain, which were jacking up costs. Public mailboxes, according to industry experts, are getting far less use. So the Postal Service removed a bunch of both, causing an uproar from liberal activists.
DeJoy suspended the machine and mailbox removals in August, days before he was grilled about them before House and Senate committees, but he also said the Postal Service would not reconnect any sorting machines or replace any mailboxes.
FALSE: Republicans used a 2006 law to tank the Postal Service
One of the most controversial provisions in postal policy is the 2006 Postal Accountability and Enhancement Act (PAEA), which is broadly misunderstood. The statute did two main things: It created a system for postage rate setting, and it changed the way the Postal Service funds its retirees’ health benefits.It’s the health benefit fund that all these years later gets most of the attention. It’s a hefty burden on the Postal Service, and undoubtedly, the agency’s balance sheet would look a lot better without it. Without the pre-funding mandate, which costs around $5 billion annually, the Postal Service would have more money to invest in vital services.
Even more, left-leaning activists like to accuse Republicans — especially Sen. Susan Collins of Maine, who sponsored the bill — of purposefully creating this expensive program to bankrupt the Postal Service and drive it to privatization.
Not true.
The Postal Service needs a bailout. Congress is partly to blame.
PAEA (it’s pronounced “paella,” like the Spanish rice dish, in postal circles) had bipartisan sponsors in both chambers of Congress. It passed on voice votes, meaning there was almost zero dissent among lawmakers.“This bill is critically important to the long-term fiscal health of our Postal Service. It is equally important to the well-being of all our postal workers as well as the needs of all citizens and businesses, large and small, which use our Postal Service,” Sen. Patty Murray (D-Wash.) said on the Senate floor before the bill was passed.
The pre-funding mandate was a compromise between the George W. Bush White House and Democratic bill sponsors. Bush wanted to take those retiree health-care costs off the federal government’s books. Democrats wanted to make sure money for workers who retired from a physical and taxing profession was socked away. They arrived at this deal: The Postal Service, which was making plenty of money at the time, would set aside the cash to take care of retirees.
Then, the agency stopped making money. The iPhone came out in 2007. The Internet matured. The Great Recession hit. As a result, residential and commercial customers sent far less mail, and it cost the Postal Service billions of dollars. By 2011, the agency wasn’t even paying into the retiree health-care fund. And yes, the obligations from that fund look really ugly on the agency’s balance sheet. But that doesn’t have anything to do with privatizing the Postal Service.
FALSE: Eliminating the pre-funding mandate would fix USPS’s problems
Sure, wiping the pre-funding obligation off the books would make the Postal Service’s finances look better, but it wouldn’t solve its biggest monetary crunch. Here’s why:The Postal Service lost $9.2 billion in 2020, it reported to Congress. Of that, $4.6 billion was supposed to go into the pre-funding account. In 2019, it lost $8.8 billion, and $4.5 billion should have gone into the account.
But the Postal Service hasn’t paid into the retiree health-care fund since 2011, without any ramifications. Lawmakers in both the House and Senate, and officials within the Treasury Department, according to numerous current and former aides involved with the mail agency’s finances, say policymakers have largely given up on making the Postal Service pay off its debts to the federal government.
The Postal Service has realized this, too. “The Postal Service has not incurred any penalties or negative financial consequences as a result of not making these payments,” it wrote in its most recently quarterly report.In other words: We know that you know that we’re not good for the money. And we know that you know that this debt isn’t our biggest problem.
The Postal Service’s biggest problem is the mail. Americans are not sending enough of it to keep up with the agency’s growing expenses. We sent nearly 40 billion fewer pieces of first-class mail, the Postal Service’s top profit generator, in 2020 than we did in 2008. The numbers are nearly as bad for marketing mail, coupons from your local tire shop or big-box store and another big profit engine: Thirty-five billion fewer items flowed through the system in 2020 than in 2008.
In fact, 2020 was the first year in which the Postal Service earned more from packages than it did from first-class mail, which says something about the agency’s dire circumstances. By law, each package shipped has to cover its own costs and contribute a percentage to agency overhead. But packages are harder and costlier to transport than small paper envelopes. Ergo, they generate less profit than first-class mail.
Turning around the Postal Service’s finances, experts say, requires reining in costs, creating new or more efficient revenue streams and stabilizing declining first-class mail volumes. Offloading the retiree health-care pre-funding requirement makes sense, they say, because the Postal Service doesn’t make enough money anymore to support that kind of annual expense. But it’s not enough to solve the Postal Service’s deep financial troubles.
TRUE: Democrats want you to bank at the post office
The Postal Service needs new revenue streams, and some Democrats are outspoken about one big idea: postal banking.
Liberals, including Sen. Bernie Sanders (I-Vt.), Sen. Kirsten Gillibrand (D-N.Y.) and Rep. Alexandria Ocasio-Cortez (D-N.Y.), want post offices to offer financial services as a way to serve the roughly 66 million Americans who are unbanked or underbanked, and help raise more money for the agency. The idea would have the post offices provide simple banking features, like check cashing and small savings and checking accounts, so customers wouldn’t have to use risky or high-interest financial vendors, like payday lenders.
Biden appears to support the proposal, including it among recommendations from a “unity task force” between his and the Sanders campaign.
FALSE: Republicans want to privatize USPS
To be clear, most Republicans don’t want to privatize the Postal Service, but some do. The Trump administration in 2018 recommended transitioning the Postal Service “from a government agency into a privately-held corporation.” And the Heritage Foundation, a right-leaning think tank where former vice president Mike Pence now serves as a distinguished visiting fellow, has pushed postal privatization for years.
But the public Postal Service is still the dominant policy position in the GOP, and there are a bunch of complex policy reasons why. You really only need to know two simple ones:
First, Republican-leaning areas need the Postal Service more than Democratic-leaning areas. Conservatives tend to reside in more rural or suburban parts of the country. Because those places are more far-flung and are less populousthan cities, delivery costs more. Think about it: It takes longer to deliver fewer items to people who don’t live near one another.
No private shipping company delivers to every American address, and many enter into “negotiated service agreements,” volume-discount contracts, with the Postal Service for last-mile delivery from a post office to a consumer’s home or business. They give those items to the Postal Service to deliver instead, because the agency must deliver to those addresses under its universal service obligation (which means just what it sounds like: You live in America, so we have to deliver your mail). If the Postal Service privatized and had to turn a profit, it would also avoid going to less profitable rural and suburban areas, and folks — many of whom vote Republican — wouldn’t get their mail.
Second, private companies do not want to compete with the Postal Service on mail delivery. For all of its warts, the Postal Service is actually really good at delivering the mail, and private express carriers do not want to try to crack that market. The carriers also need the Postal Service, through its vast network and skilled workers, to handle less lucrative deliveries. Carriers also would need to retrain their workforces, buy new machinery, reconfigure their logistics and transportation operations and so much more. Could you really expect a UPS driver to go to every home and business on your street six days a week? Of course not, and neither could the Postal Service’s private-sector contemporaries.
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There may be fuel in this last paragraph for a subsequent post on private enterprise v. government.