Sept. 3, 2014—NALC President Fredric Rolando had a strong letter in the Sept. 3 Orange Country Register, responding to an Aug. 28 editorial in the paper that blamed workers’ compensation and workers’ salaries for the Postal Service’s reported red ink—basically taking (local) Rep. Darrell Issa’s (R-CA) stance. Rolando gave the paper—and the congressman—a basic lesson in postal finances.
True cause of Postal Service challenges
Fredric Rolando, president, National Association of Letter Carriers: Your editorial [“Labor costs weighing down Postal Service,” Opinion, Aug. 28] misconstrued U.S. Postal Service finances and the cause of its red ink. You focused on workers’ compensation payments, devoting a paragraph to one worker who claimed she couldn’t lift heavy weights, before finding other ways to blame employees.
Here are the facts. The Postal Service’s financial report for fiscal 2014’s third-quarter showed earnings increasing in each mail category: packages up 6.6 percent, standard mail up 5.2 percent and first-class mail up 3.2 percent. Overall, revenue rose by $424 million.
Why the positive trend? As the economy gradually improves, letter revenue has followed suit. Meanwhile, rising online shopping has boosted package deliveries, making the Internet a net positive (and belying your claim that digital communications are hurting the Postal Service).
USPS, which gets no taxpayer money, has a $1 billion operating profit so far this year and has been operationally profitable since October 2012 – earning more revenue selling stamps than it spends delivering the mail.
Why, then, the red ink? Simply put: congressional interference. In 2006, Congress mandated that the Postal Service prefund future retiree health benefits. No other public or private entity is required to prefund for even one year; USPS must pre-fund the next 75 years ahead and pay for it all over 10 years. That’s the red ink.
Rather than break what works, Congress should fix what it broke by addressing the prefunding fiasco.
Click here to read the letter (subscription required).
