Principled Leadership Needed at the US Postal ServiceDavid Williams on April 05, 2016
The United States Postal Service (USPS) is in trouble. The USPS has lost $35.6 billion in the last four years, their unfunded liabilities equal $114 billion, and a report released this week showed that the mail is late more often today than it has been at any point in the last 5 years. More specifically, in the first half of 2015 late mail rose 48 percent compared to the previous year. Postal Service leadership needs to provide better financial oversight and hold management accountable.
As a leading government watchdog organization, the Taxpayers Protection Alliance (TPA) launched a new website, PostalReformforUS.org, to help the USPS find their way through these turbulent times. TPA has partnered with Americans for Tax Reform, National Taxpayers Union, and R Street, who all have similar concerns about the USPS’ future.
The USPS is not a publicly traded company, but this does not excuse postal leadership from providing proper management and oversight. In many ways, the Postal Service is similar in stature to the nation’s large companies. USPS had a $67.8 billion annual operating budget and 625,000 employees during the last fiscal year, which makes them 2nd to Wal-Mart in total employees. Occupying 25,300 spaces in its facilities inventory, they are 2nd to McDonalds in total real estate.
Also mirroring large organizations, which have a board of directors to supply strategic direction and maintain financial accountability, the U.S. Postal Service has what they call a Board of Governors.
In 2006, Congress passed the Postal Accountability Enhancement Act (PAEA) to bring reforms to the US Postal Service and specify the qualifications for the Board of Governors:
“The Board of Governors shall represent the public interest generally, and shall be chosen solely on the basis of their experience in the field of public service, law or accounting or on their demonstrated ability in managing organizations or corporations…At least 4 of the Governors shall be chosen solely on the basis of their demonstrated ability in managing organizations or corporations (in either the public or private sector) that employ at least 50,000 employees.”
Today, the US Postal Service has just one active Governor while the other eight seats remain vacant. Finding itself in such a large financial hole, the US Postal Service, now more than ever, needs the leadership and direction of a business-minded board.
The proposed minimum principles for all Board of Governors nominees would ensure a heightened level of management and oversight:
- Have executive experience overseeing a similar private or public entity.
- Possess knowledge of Postal Service and its functions, as well as the larger logistics industry and landscape – including regulatory policies – in the United States.
- Keep an unrelenting commitment to fiduciary responsibility, and maintain control of the Postal Service’s revenues and liabilities.
- Stress accountability to customers, taxpayers and shareholders.
- Understand and protect the core mission of quality letter delivery at an affordable rate.
Concerns over the future of the Postal Service are nothing new and the questions must be asked about how the agency intends to reverse its downward trends and reach stability. Some may tout that the Postal Service stands on its own by not accepting tax dollars and survives on revenue from stamps. However, relying on the federal government for around $18 billion in federal subsidies annually is not an example of self-sufficiency.
The larger worry is, if leadership does not right the ship, will the federal taxpayer be called upon to provide a bailout to get their finances back on stable ground?
From the new website, PostalReformforUS.org, our organizations will address these leadership concerns, as well as issues related to USPS’ mission creep, delivery reform, and vehicle purchases.
Ultimately, our collective effort will allow us to continue to advocate for a more self-sustaining Postal Service.