To hear the postmaster general tell it, there's no single solution to the U.S. Postal Service's projected $7 billion deficit next year.
The simplest revenue enhancement, it seems, is a postal rate increase. The Postal Service has proposed increasing the cost of a first-class stamp by 2 cents by Jan. 2, bringing the cost of a single stamp to 46 cents.
While that increase will pinch businesses and nonprofits that are some of the service's most prolific customers and already struggling with business costs during the economic downturn, raising postage prices would generate only about $3 billion the first fiscal year — less than half of the agency's projected deficit.
Congress needs to move ahead with needed reforms. The Postal Service, with the help of consultants, has identified a number of cost-cutting measures, such as eliminating one day of postal deliveries each week and restructuring pre-payments of retiree health benefits.
Care must be taken to ensure that people and industries that rely on the Postal Service receive an appropriate level of service. This is particularly important for people who do not use computers to pay bills online or communicate via e-mail. It is highly important that this population continues to receive pensions or benefit checks in a timely manner.
Cutting a day of delivery also has implications for rural communities far from major routes of transportation. Unlike urban dwellers, rural residents do not enjoy a like level of service options from private shippers. Some private companies serve these areas, but their delivery schedules are infrequent.
Unfortunately, raising postal rates appears to be a given to help sustain the struggling U.S. Postal Service. The quasi-independent agency is a taxpayer asset, and taxpayers deserve better performance. Congress needs to act on this issue. At the same time, any other cost-cutting measures must be achieved in a manner that gives people who must rely on the Postal Service timely access to deliveries.