Privatization at USPS
The US Postmaster General continues to make moves that spark concerns for USPS union leaders, as workers receive a mass email touting the benefits of the US Postal Service going private.
Last week, US Postmaster General Louis DeJoy allowed Elon Musk’s Department of Government Efficiency and General Services Administration (DOGE) to take over his operation, culminating in more staff cuts and creating immediate concerns over the impending privatization of USPS mailing services. According to a letter sent to US House and Senate leaders last Thursday, DOGE will “assist” the postal service with addressing issues like the “mismanagement of the agency’s retirement assets and Worker’s Compensation Program.”
DeJoy has now followed up with another letter to Congress on Monday to further clarify his position, after receiving a “great deal of inquiry” from elected officials about the future of the USPS and the possibility of the organization being privatized. In this letter, the Postmaster General hints further at the possibility of taking the postal service private saying, “the Postal Service is engaging in a historic level of transformational change.”
Among DeJoy’s two chief concerns in his latest letter for the solvency of the USPS moving forward are the issue of retirement funds and worker’s compensation costs. This complete turnabout is concerning given DeJoy’s signature plan called Delivering for America — a system that was implemented in the Fall of 2023 that promised to create a consolidated network of 60 regional distribution centers and solve delivery problems in a 10-year strategic plan, with a total cost of $40 billion.
For years, DeJoy has pledged that his plan would reduce costs, improve reliability and make the Postal Service more competitive, but data clearly shows that his program has done just the opposite. At the start of this new initiative, DeJoy promised the USPS would breakeven in 2023, but the net loss reported at the end of the 2023 fiscal year in September, totaled $6.5 billion. This loss is shocking compared to the prior year, which yielded a net income of $56.0 billion in 2022.
DeJoy has now been at the helm of the USPS for over five years and his decisions have only resulted in ongoing federal government bailouts and uncertainty about the future of the USPS, which has been operating for 250 years. In February of this year, DeJoy announced plans to “step down” from his post, and it seems with regard to being held accountable for ongoing mismanagement, privatization is the answer to Louis DeJoy’s dreams.
DeJoy and Musk plan to fire 10,000 workers in order to supposedly save billions of dollars from the US Postal Service budget. In his letter to Congress last week, the head of USPS confirmed that DOGE will assist USPS with addressing “big problems” at the $78 billion-a-year agency, which has sometimes struggled in recent years to stay afloat. The agreement also includes the General Services Administration in an effort to help the Postal Service identify and achieve “further efficiencies.”
USPS listed such issues as mismanagement of the agency’s retirement assets and Workers’ Compensation Program, as well as an array of regulatory requirements that the letter described as “restricting normal business practice.” DeJoy continues, “This is an effort aligned with our efforts, as while we have accomplished a great deal, there is much more to be done.”
Trump’s Postmaster General has asked DOGE to review:
Retail leases: help reviewing "almost 31,000 retail centers and the future difficulties we will face in their renewal because of ownership consolidation, urban development, and general increases in rental rates when decades long leases expire."
Counterfeit postage: DeJoy says the service is "combating an estimated one-billion-dollar problem with counterfeit postage" and says it needs "additional innovative solutions" to address the issue.
Federal laws: DeJoy claims unfunded congressional mandates imposed on USPS by legislation are estimated to cost between $6 billion and $11 billion annually, (despite the Republican Party being responsible for not funding those directives.)
Regulations: DeJoy has noted "burdensome regulatory requirements" restrict "normal business practice." He estimated the Postal Regulatory Commission "inflicted over $50 billion in damage to the Postal Service by administering defective pricing models,” even though DeJoy taking no accountability for implementing those pricing models.
DeJoy has always listed retirement and worker’s compensation as the two major problems regarding USPS solvency. Consider his list above, which blames Congress for a lack of funding, despite the Republican Party maintaining a majority in both houses. Now, DeJoy and Musk will attempt to use mass layoffs to cut spending and do the job Louis DeJoy has been claiming to do this entire time. It’s time to call USPS privatization what it really is: another bailout to cover for DeJoy’s incompetence.
The impending layoffs of USPS employees will seek to cut billions of dollars from the budget by ultimately shorting employees of their earned benefits, like their retirement security. One great way for Trump to claim he has eradicated all of those costs is to force unionized postal workers into an arrangement where their entitlements are all erased in favor of enticing benefits with a newly privatized federal mail service.
Perhaps the best indication of the intent to privatize the postal service comes from the head of the worker’s collective, who warns that this latest action by the Trump administration is “not a false alarm.” On Sunday, USPS Union President Miriam Bell sent the following email to various postal workers to warn them about DeJoy and Musk’s intention to privatize the USPS.
“In our monthly meeting we openly discussed the imminent threat of privatization against the USPS by the current administration. I shared at the meeting the very real document from Wells Fargo Risk Management team outlining how this should and could be accomplished and exactly how they plan to dismantle the Postal Service.
You need to read this and see how the current administration plans to do this. This is not a drill, not a cry of wolf, and not a false alarm. PMG DeJoy has called in DOGE to ‘help’ eliminate waste. This has targeted employees at every other agency. I do not know of any good reason the PMG would do this other than to help him accomplish the destruction of the USPS and bring about privatization.
None of our jobs are safe at this point. Our collective bargaining rights are not safe.
Please don't think it's no big deal. There has been no rationale utilized with past mass firings and we have no reason to believe this would be different. What is different is that we are under congressional control. As a union, the APWU is organizing a rally on March 20, in over 150 locations nationwide to educate the public on why privatization is bad business. An increase in postage rates up to 140%, reduced delivery areas, and more detrimental changes need to be shared with the public so they can contact their representatives and urge them to oppose privatization.
I am attaching both the Wells Fargo document and the talking points on saving the USPS. Please join us March 20th at Park Rd Station between 11am and 2pm. This is your job and your future. Surely it's worth your time and some leave. Our battle is just beginning.”
In Union Solidarity,
Miriam Bell, President
The email, printed in it’s entirety above, was sent with a 13-page attachment from Wells Fargo Bank, outlining the benefits of USPS privatization and what would have to happen for that venture to be successful. Last Wednesday, Elon Musk, said publicly that the US Postal Service and passenger railroad Amtrak should be privatized. "I think logically we should privatize anything that can reasonably be privatized," Musk said at a Morgan Stanley conference. "I think we should privatize the Post Office and Amtrak for example...We should privatize everything we possibly can."
DeJoy claims that legislation has stopped USPS from making progress under his Delivering for America plan, when it has actually been his abysmal leadership and poor management skills that got the postal service to this point. The bottom line is that his plan was always going to fail and this was evident when DeJoy publicly claimed success, despite continuing to lose billions annually. He created the illusion of a “10-year-plan” to buy him enough time to financially sink the postal service so that privatization would appear to be the only solution and then retire from his job.
"The fact is that DOGE is the only other game in town that seems oriented toward helping us to achieve our efficiency and cost goals that are reflected in the DFA Plan," DeJoy wrote. This statement is also a misnomer in that the immediate solution to funding the USPS and making it a profitable and reliable enterprise is to simply fund the mandates that Republicans have refused to fund.
For more on the unacceptable actions of Louis DeJoy as Postmaster General, read these articles published by SHERO:
Destroy the Post Office, Steal an Election, published on Aug. 7, 2020
Friday Night Massacre at the Post Office, published on Aug. 8, 2020
Will You Vote By Mail? published on Aug. 11, 2020
Trump's Postmaster General has Financial Conflicts, published on Aug. 13, 2020
US Post Office is Removing Ballot Sorting Machines from Facilities, published on Aug. 13, 2020
USPS Warns of PA Ballot Delay; Mailboxes Removed in OR, published on Aug. 14, 2020
Definitive Guide to Trump’s Attempts to Destroy USPS, published on Aug. 18, 2020
DeJoy to Answer to US Senate, published on Aug. 21, 2020
USPS Rates to Increase Again, published Jan. 19, 2024
DeJoy Will Try to Help Trump Again in 2024, published in April 12, 2024
Amee Vanderpool writes the SHERO Newsletter, is an attorney, published author, contributor to newspapers and magazines, and an analyst for BBC radio. She can be reached at avanderpool@gmail.com or follow her on Twitter @girlsreallyrule.
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The president cannot privatize USPS. https://www.kgw.com/article/news/verify/donald-trump/president-cant-privatize-us-postal-service-fact-check/536-042308fd-6b70-4287-aa99-e175b4b96ce4
In any case, the burden of privatization will fall, of course, on the employees and the unions, but ultimately on the customers as well. Tell me when privatizing any governmental entity resulted in lower costs to operate, lower costs to users, better deals for employees. Private postal service will ultimately fail, of course, because no non-governmental organization can finance the capital to make it work.
We're are going to get screwed. What else is new?