BY THE TIME YOU READ THIS, the trade press will be abuzz with the news that participants in the 2001 postal rate case agreed to bring the proceeding to an early end. Most mailers will have to judge for themselves whether settling this case was better than litigating it. As someone involved in R2001 from the get-go, I can assure you the outcome was preferable to the alternative.
This should not be interpreted to mean that I believe the settlement agreement was anything close to being the greatest thing since sliced bread. Quite the contrary. Rate cases generally are bad news. Why? Because they’re begun only after the postal service has exhausted all its available cash.
Rate cases are nothing more than arguments over spilled milk. That is, the cash the USPS needs to break even will soon be depleted and rate increases are required to allow it to comply with postal law. To avoid postal rate unpleasantness, the issue of how the USPS should be run has to be addressed before, not after, a cash crunch.
In general, mailers are far from delighted with the prospect of forking over more money in the form of higher postal rates any sooner than necessary. It might have escaped the minds of the USPS’ governors and executives, but 2001 was a horrible year for many in the mailing industry. Things weren’t so hot well before Sept. 11, and nothing that happened since improved matters.
In case these execs missed it, they should have noted that companies across the United States were slashing their staffs and operating costs to the bone in order to survive the slumping economy. Everybody was trying to make due with less. Everybody, that is, except the U.S. Postal Service.
The USPS today employs just about the same number of people as when 2001 began. No one’s been laid off. (We’re not talking here about phony reductions by attrition, but rather about layoffs where people actually get pink slips.) Not one postal facility has been closed. In fact, mailers can’t seem to find evidence of any pain the postal service has undergone given the extraordinary circumstances the business community had to face last year.
This doesn’t sit well with many, and it had better not be an indication of how the USPS will perform in 2002. The mailing community has had it. It’s given the USPS a break with an early rate implementation. Now the USPS has to do a little giving of its own.
GENE A. DEL POLITO is president of the Association for Postal Commerce (PostCom) in Arlington, VA.
