President Trump contemplated on Friday on assigning the U.S. Postal Service under the jurisdiction of the Commerce Department. This could potentially result in an executive branch’s incursion of this agency, which stands as an autonomous establishment from 1970. Trump stressed his desire to convert the postal service into a more efficient organization that stops hemorrhaging massive funds. It is in consideration to align it under a possible merger, while still maintaining its core identity as the Postal Service. Trump anticipates a marked rise in administrative performance due to this.
Trump’s principle underpinning this proposal was to halt the enormous losses the agency has been incurring. With a colossal annual expenditure upwards of $78 billion, the agency has been incapable of maintaining its income-expenditure balance, especially with the stringent decline of first-class mail. According to Trump, the current state of the Postal Service is significantly draining the resources of the U.S.
Now, let’s delve into the annals of the USPS. The initial seeds were sown during the era of the Second Continental Congress in Philadelphia, in 1775, with Benjamin Franklin’s appointment as the first postmaster general. In 1872, it was labeled an executive branch department by the Congress. However, the story took a detour post the 1970’s eight-day wage and benefits postal strike which led President Nixon to enact the Postal Reorganization Act. This act helmed it into an independent, self-sustaining agency termed the U.S. Postal Service. Despite the protests around its privatization, the service remained resolute.
Consequently, the 1970 reconfiguration led to wage-raise and collective bargaining rights for workers. This facilitated the upward social mobility into the middle class for a substantial population segment, particularly Blacks and other minorities. The agency has engaged around 640,000 workers, ensuring mail and other delivery services reach every nook and corner of the nation, right from city centers to far-off islands, even amidst a pandemic.
The executive panel of the Postal Service is constituted by a maximum of nine individuals, having received their appointment credentials from the President and subsequent Senate ratification. An essential norm is to maintain a diversified political representation with not more than five members coming from one party. There are still three unoccupied seats due to the absence of Senate voting for those nominations.
Post the 1970 reforms, the USPS shifted towards an almost self-funding model. The significant component of their whopping $78.5 billion annual budget is derived from customer charges. A negligibly small allocation is also earmarked by the Congress to subsidize free and discounted postal services.
Despite these sources, issues like a downturn in profitable first-class mail and retiree benefit expenses pushed the Postal Service to accumulate losses to the tune of $87 billion from 2007 to 2020. Critics of the service blamed the initial consolidations for the slow delivery pace and projected potential hampering of rural mail delivery due to further consolidations.
President Trump, since his initial years in office, has proven to be a constant adversary of the Postal Service. He stirred a controversy in 2020 when he hinted at obstructing relief funds unless the service raised package rates for large customers by fourfold. More recently, Trump deliberated on its privatization owing to market competition, saying ‘It’s a concept that has been in the minds of many for a long time. We are examining it,’.