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Postal Reform Act Is Not A Conservative Solution

Holly Sadler, American Commitment on March 30, 2017

Last week, despite opposition from numerous free-market and conservative groups, the House Oversight and Government Reform Committee voted to pass the Postal Reform Act of 2017 (H.R. 756) out of committee. This is a committee with eight conservative Freedom Caucus members on it, yet this is not a conservative bill. We’ve written before about why H.R. 756 is not a conservative solution and does not provide the necessary reforms to fix the USPS’s numerous problems. Our concerns remain the same.

Before this legislation comes to a vote on the House floor, we would urge representatives - particularly Freedom Caucus Chairman Meadows and his fellow committee members - to think carefully.  Postal reform sounds great – sure. But this bill does little to address the underlying causes of the postal service’s problems and, in many cases, will make matters worse.

Of greatest concern are the following provisions:

2.15 Percent Increase in First Class Postage Rate

For 50 years, the postal service has obtained rate increases the same way – through the Postal Regulatory rate review process. This should not change now and Congress should not bypass this accountability measure that ensures only necessary rate hikes take place. Additionally, first class mail service is actually one of the USPS’s most profitable services and it is essential to their mission. Price increases will only cause demand in this profitable area to falter.

Centralized Mail Delivery

Adding insult to injury, this legislation pushes the USPS toward centralized mail delivery, which indicates a further departure from their core mission and suggests that any increase in first class postage rates will not be spent on bolstering core services, but rather continuing to operate inefficiently at the administrative level and spending resources on unprofitable programs that compete with private sector companies.

Establishment of the Chief Innovation Officer

For several years now, the USPS has been venturing into new areas of service like food and parcel delivery. These programs have largely been unprofitable – though the total cost is unknown since precise numbers are hidden in a “catch all” budget category. Now, Congress wants to not only allow, but encourage, the USPS to compete against private businesses – at a subsidized rate. This is opposite of a conservative reform. The postal service should be cutting back on these unprofitable services that they are ill-equipped to provide and stop unfairly competing with the private sector…not ramping up activity and developing new and ineffective revenue schemes.

Governance Reforms

Finally, the USPS Board of Governors is currently comprised of nine members, the Postmaster General and Deputy Postmaster General. These positions are presidentially appointed and confirmed by the Senate, serving a seven year term. HR 756 reduces the number to five which, in theory, makes the board easier to fill; however, this reform is essentially a reform in name only. Additionally, the effectiveness of the board is limited in their authority to prevent agency leaders from making irresponsible decisions. More is needed in terms of requiring accountability, efficiency, and quality in core service delivery from the USPS.

Postal reform is needed, but it’s important to get it right. Conservatives in Congress should recognize this bill will not do what it claims and, instead, focus on free-market, limited government solutions to address the problems plaguing the USPS.  

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