Mismanagement and Incompetence Reign Supreme at the U. S. Postal Service

And Congress Lends a Helping Hand – Not!

The current issue of Business Week features a story on the financial woes of the U. S. Postal Service,

The U.S. Postal Service Nears Collapse

along with background on how it got to where it is, what other postal services around the world are doing and what the U. S. system is considering.  It is not a pretty picture, and not recommended for persons under 13 or for anyone just after consuming a meal.

There are two items in the article that require commenting on.  The first is that its collective bargain agreement with 250,000 American Postal Workers Union contains a no-layoff clause.  And not only was that in past contracts, it is continued in the current contract that was signed in March.

Really.  A no-layoff clause for an organization at the edge of bankruptcy.  A no-layoff clause where 80% of costs are salaries and benefits.  A no-layoff clause where the comparable number for Fed Ex is 43% and for UPS is 61%.  What were they thinking?

Now normally at this time you would expect the ranting and railing against public employee unions who have received unreasonable terms in their contract.  No, the Union is not to blame here.  It is a union’s job to advocate for its members.  It is management’s job to preserve managerial prerogatives so it can run the business. It is management’s job to say no to contract proposals that interfere with its operating of the business.  The blame for this provision lies squarely with management.  They needed to say no.

The second point is that apparently the Congress has enacted a provision that prevents the closing of any post office solely for economic reasons.  Now that’s a great idea.  So the USPS cannot lay off workers, cannot close post offices and cannot generate enough cash flow to survive. 

There are other countries that have faced this dilemma.  They have reorganized their postal services, eliminated post offices and placed postal services in convenience stores where the post office is operated by private employees of the convenience store, and put new services and feature into the system.  They are profitable and sustainable.  Why don’t we copy them?  Because in America we don’t get lessons from other countries, we give lessons to other countries, that’s what we mean by American Exceptionalism. 

So Congress and Post Office Management, good luck but we really do not want you coming to the U. S. Taxpayer to bail you out.