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USPS Pursues 'Transformation Plan'
Burrus Update #12-02, June 3, 2002
Postal management is continuing the implementation of its Transformation Plan in response to the instructions of Congress and the Postal Board of Governors. This effort is a means to mollify major mailers who continue to insist upon postal rates that rise less than inflation and permit continued profits at the expense of universal mail service. At the heart of this plan is the reduction of postal services.
Even though the postmaster general has committed to rejecting a nationwide effort to consolidate mail-processing plants, the area and district managers continue to explore closings or significant reductions in dozens of plants throughout the country. These efforts will have an adverse impact upon APWU-represented employees who will experience excessing to distant facilities.
Included in the Transformation Plan is a proposal for legislative reform that would permit the Postal Service to compete in the private sector. If the stakes were not so serious, this would be but a bad joke. One has only to review past efforts at private sector activity. Does anybody remember the disastrous contracts with Lockheed Martin in the REC Sites? What about the Emery disaster with Priority Mail? And most recently, the sellout to Federal Express.
This entire exercise represents an effort to transfer revenue from the Postal Service to private sector firms, which turn a profit on postal activity at the expense of the USPS. The Postal Service is paying private mail firms more than $1,200 per hour to generate bar codes on letters that often are of such poor quality that the bar codes must be re-applied after insertion into the postal system. This activity costs less than $30 per hour when performed by postal employees, and the quality of the bar codes are far superior. The excess above postal costs is turned into massive profits by major mailers and direct mail firms.
USPS postage rates are the cheapest in the world while delivery to every home is the most extensive in the world. Rates for discounted mail have increased less than the cost of inflation, yet postal management has been convinced that there is a need for transformation of the Postal Service. Postal management has become a tool of the private mailing industry to guarantee profits. In response to the unions demand that discounts be set at a cost less than the cost avoided, postal management's response is that the mailers will not generate the same level of volume if they are denied the unjustified subsidies.
This logic is absurd. For starters, the mailers are already paying more than the discounted rate. The direct mail firms pass on to the mailers only a portion of the discount and retain the difference to operate the processing operation and generate profit. The colleges, universities, hospitals and government entities that use their services are presently paying 30 to 32 cents per first-class letter, but the Postal Service only receives 24.5 cents per piece. The major mailers that pocket the entire discount have absolutely no entitlement to savings of 9.5 cents per letter for the cost they incur programming their computer to print bar codes. The initial cost is recovered in the first mailing and all subsequent mailings generate savings in the hundreds of thousands of dollars.
Postal officials have been brainwashed into believing that the concerns of the major mailers and the direct mail firms are superior to the financial stability of the Postal Service itself and are in lock step to transform the Postal Service into a cash cow for private industry. We cannot permit these cannibals to dismantle the best and cheapest postal system in the world.
Postal employees recognize Transformation for what it is: the dismantling of the United States Postal Service.
William Burrus
President
