Postal Service Feels Weight Of 'Junk Mail'

Standard mail, includes advertising circulars and catalogues, proves profitable for the Postal Service. (By Damian Dovarganes -- Associated Press)

Montgomery proposed "do not mail" legislation late last year, making Maryland one of 18 states to consider such a registry since 2007.

Soon after she filed her bill, she said she was inundated by lobbyists who represent the Postal Service and direct marketing industry. "There was so much pressure against it," she said. "It turns out the Postal Service is relying on a lot of this junk mail."

Montgomery withdrew her bill but says she will reintroduce it after more research and a consultation with the state's attorney general.

At yesterday's hearing before the Senate subcommittee, Potter talked about the Postal Service's lobbying efforts against "do not mail."

"We're working very hard to inform people about the role that mail plays in the economy, as an employer of millions of Americans," said Potter, adding that it is unclear whether states have the authority to create laws that affect the Postal Service. "Fortunately, no legislation has passed."

It seems unlikely that mail volume will return to previous levels once the economy improves, thanks to shifts in the way Americans are communicating and doing business, Potter said.

To solve its immediate headaches, the Postal Service will reduce labor costs by cutting overtime and using more seasonal workers, Potter said. The service also plans to raise the cost of stamps and premium services in May, taking advantage of major reforms passed by Congress last year that clear the way for annual rate increases. The cost of a first-class stamp will rise a penny, to 42 cents, and will increase every May thereafter, officials said.

Under the reforms passed by Congress, postage for letters can increase no higher than the rate of inflation, but fees for package delivery can be raised to compete with rates charged by FedEx and other private competitors.