- The Washington Times - Saturday, March 17, 2001

It's enough to make taxpayers go postal. Before they could even think about buying packs of 34-cent stamps, the United States Postal Service (USPS) has requested yet another rate hike.

Again, the requested rate hike is in the double digits, and again, USPS spokespersons will not say how much money they hope the hike will raise, nor what they expect the money to do.

The USPS will admit that it is expecting operating losses of between $2 and $3 billion this year, the ostensible reason for the rate hike. USPS spokespersons have made noises about convening a bipartisan coalition to produce political cover, er, postal reform, and postal officials have promised to halt new construction on postal facilities.

Yet the USPS has not promised, nor even suggested simple attrition of the post office's 900,000 workers, a step which could save hundreds of millions each year. When not working, postal employees are wasting. The USPS Office of Inspector General recently documented over $1.4 billion in waste, fraud, and abuse, including limo rides and extravagant retirement parties. USPS productivity has consistently been more stagnant than the mind of the average Palm Beach voter.

The USPS has not even suggested that it would drop its highly unsuccessful product lines ranging from T- shirts to phone cards, on which it lost $84 million between 1995 and 1997. According to Citizens Against Government Waste, the Post Office spends between $350 and $400 million annually on promotional activities. But (to borrow another advertising campaign), "Image is nothing." Besides, aside from absent-minded spouses, does anyone really need to be reminded about buying stamps? Incidentally, a USPS spokesperson called the product lines "a complete success" which they may well be, compared to other postal operations.

In the short-term, attempts to increase postal rates should be resisted until the USPS has improved productivity and divested itself of all nonessential products and personnel. Legislators should also allow the USPS to be buffeted by more competition, including ending the USPS' exclusive domain of mailboxes. (Under current law, competitors cannot deliver envelopes or packages or newspapers into mailboxes instead such items must be hung on doorknobs or dropped on the porch.)

Ultimately, rate hikes, regardless of size, are no more than budgetary Band-Aids which provide bureaucratic cover. USPS governors recently called for fundamental statutory reform.

That reform should be in the form of privatization, allowing the USPS to swim (or sink) in the choppy waves of the market, unencumbered by government subsidies or taxpayer bailouts. Perhaps then, but only then, will taxpayers not be bothered by rate hikes every few months.


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