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Trump Orders Review Of Postal Service's Operations

14 April 2018

President Donald Trump has directed a presidential task force to study the United States Postal Service and how it prices packages.

"The USPS is on an unsustainable financial path", the order read, noting that the postal service incurred losses of $65 billion since the recession and citing declines in First-Class Mail volumes and "legal mandates that compel the USPS to incur substantial and inflexible costs". The creation of the task force comes nearly two weeks after Trump lashed out on Twitter, attacking Amazon, saying it was draining the USPS of money it can't afford to lose. The task force is instructed to submit a report on its findings within 120 days. Amazon and the Postal Service signed a five-year deal in 2013 to deliver packages on Sundays, and both entities have declared the arrangement a success. The order calls for an examination of the Postal Service's pricing, policies and workforce costs. "He repeated a claim that the Postal Service loses "$1.50 on average for each package it delivers for Amazon" and said "only fools, or worse" believe the Postal Service makes money from doing business with Amazon. The task force will also review how the decline in mail volume is affecting the USPS, along with its work force and operations. Not to mention the fact that the huge number of packages the Postal Service ships for Amazon is helping to keep it afloat for the rest of us. And the Citigroup analyst who wrote the original report clarified recently that Amazon's business could indeed be profitable for the USPS.

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However, the task force might suggest that USPS charge Amazon and other companies more for parcel delivery. But package delivery is actually a rare growth area for the service.

Trump's Amazon Twitter tirades have often coincided with negative press from the Washington Post, a paper owned privately by Amazon CEO Jeff Bezos.

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The Senate bill would also create a new Postal Service Health Benefits Program (PSHBP) within the Federal Employee and Retiree Health Benefits Program (FEHBP), implemented and administered by the U.S. Office of Personnel Management (OPM), for all postal employees and annuity retiree recipients and require all Medicare-eligible postal annuitants and employees enrolled in the PSHBP to also enroll in Medicare, including parts A, B and D.

Still, the demand hasn't been enough to offset its growing costs. During its most recent fiscal year, which ended in September, the USPS reported total annual revenue of $69.7 billion, which was less than the $71.4 billion recorded in fiscal year 2016. For the first time, past year the Postal Service missed payments it owes to the federal retirement system, for a combined total of $6.9 billion. The USPS has made some of those payments, exhausting its $15 billion statutory debt limit in the process.

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Trump Orders Review Of Postal Service's Operations