U.S. Postal Service might end Saturday delivery to help close $238 billion gap

By Ed O'Keefe
Washington Post Staff Writer
Wednesday, March 3, 2010

The U.S. Postal Service estimated Tuesday that it will lose $238 billion in the next decade if lawmakers, postal regulators and unions don't give the mail agency more flexibility in setting delivery schedules, price increases and labor costs.

Estimates also predict that letter carriers will deliver 150 billion pieces of mail in 2020, a drop of about 26 billion pieces from last year. Postmaster General John E. Potter plans to press lawmakers and the Postal Regulatory Commission in the coming weeks to eliminate Saturday mail deliveries and allow the mail agency to raise prices beyond the rate of inflation, if necessary.

"We intend to be around for decades and centuries to come," Potter told a meeting of regulators, congressional staffers and major mail customers Tuesday. "These are the first steps that are necessary to make sure that that occurs."

Although public polling suggests that a majority of Americans support cutting Saturday service to save money, lawmakers and union leaders signaled Tuesday that they will not rubber-stamp the move.

Fredric V. Rolando, president of the National Association of Letter Carriers, said his 300,000 members will oppose plans to cut weekend service.

"I do not believe that weakening our commitment of six-day service to the public will enhance the long-term position of the Postal Service as a critical element in our nation's economic infrastructure," Rolando said from the AFL-CIO conference in Orlando.

Sally Davidow, a spokeswoman for the American Postal Workers Union, said the Postal Service should focus first on persuading Congress to reverse a 2006 law that requires the mail agency to make prepayments to its retiree health accounts. The payments cost about $5 billion annually, but eliminating them should help close the gap, Davidow said. The APWU represents more than 330,000 postal clerks, truck drivers, mechanics and custodians.

Potter agrees that the agency needs to end the prepayments but has said those cuts will not do enough to end the agency's grave financial situation.

Sen. Thomas R. Carper (D-Del.), who chairs a subcommittee on postal issues, didn't explicitly support Saturday cuts or price increases but backed Potter's efforts.

"Management must be allowed to make the business decisions they need to stay competitive and viable in the years to come," Carper said in a statement. "As we have seen, it is not productive for Congress to act like a 535-member board of directors and constantly second guess these necessary changes."

Rep. Jason Chaffetz (Utah), the ranking Republican on the House subcommittee on postal issues, said the Postal Service should consider eight postal holidays on the slowest delivery days each year instead of cutting Saturdays.

"Saturday is an important delivery day," Chaffetz said. "Everything from bank statements and dealing with your bills to the social component of going down to the post office, I think it's an important part of what they do."

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