Condemns Postmaster General Donahoe’s Calls for Service Cuts, Post Office Closings, Job Cuts
For More Information Contact:
Ralph Nader or Jeff Musto
Consumer Advocate Ralph Nader today called for Postmaster General Donahoe’s resignation. Several consumer non-profits joined him in this letter, including Public Citizen, Consumer Action, the Gray Panthers, and Essential Information. The Postmaster General Donahoe is “actively presiding over the demise of one of our country’s greatest founding institutions,” said Nader.
In December 2011, Congressman DeFazio called for the Obama administration to fire Postmaster General Donahoe. From the House floor he said, “This guy, this so-called postmaster general, should be fired because of a lack of any imagination or initiative…He’s proposing the death knell for the great United States Postal Service.”
In his letter, Nader drew attention to the fact that, if the U.S. Postal Service was not required by Congress to prepay retiree health benefits of the next 75 years by 2012, nearly 80 percent of the USPS’s deficit would be eliminated. Nader stated that this is “an imposition unheard of in either the corporate world or by any other government agency.” He continued by pointing out that the federal government even owes the U.S. Postal Service $80 billion in overpayments that the USPS has made to two retirement funds, the Civil Service Retirement System and the Federal Employees Retirement System.
Yet, Nader notes, the Postmaster General remains virtually silent on these issues. Instead, he says, the Postmaster General makes “the case for shutting rural post offices, slashing 150,000 postal employees’ jobs, ending Saturday delivery, and extending delivery dates as if they do not produce a spiral of decline and loss of customers who will not come back.”
“In a phrase, you are not up to the job!” Nader concludes.
A full copy of the letter can be found here. [See letter below.]
Letter to Postmaster General Patrick Donahoe – It Is Time to Resign
Dear Mr. Donahoe,
You are actively presiding over the demise of one of our country’s greatest founding institutions. The U.S. Postal Service is an institution that was conceived by Benjamin Franklin and which has succeeded brilliantly over the generations to service, connect, and allow the people of our land to communicate with each other anywhere at a common rate regardless of whether they live in urban, suburban, or rural areas.
In recent years the cost-cutting and reduction of staff have coupled with the Congressional restrictions on new business opportunities – demanded by corporate interests averse to competition – to place the Postal Service in a cul de sac. Nor can the USPS overcome the draconian requirements to prepay retiree health benefits greatly in advance – an imposition unheard of in either the corporate world or by any other government agency.
Removing the devastating fiscal effect of these prepayments would take care of 80 percent of the postal service’s deficit. Moreover, the federal government already owes the postal service, according to the U.S. Postal Service’s Inspector General, over $80 billion dollars in overpayments the USPS has made to the Civil Service Retirement System and the Federal Employees Retirement System. You need to recover these overpayments. Yet while you have infrequently mentioned these strangleholds, that is not what you are known for in your direction of this historic institution.
What you are known for is a repeated demand to cut services and raise rates – a surefire way to destroy the USPS on the installment plan, a strategy that any business executive knows sets an accelerating downward course. You make the case for shutting rural post offices, slashing 150,000 postal employees’ jobs, ending Saturday delivery, and extending delivery dates as if they do not produce a spiral of decline and loss of customers who will not come back. You make the case, using the cliché of “running the postal service like a business,” when you are ruining the service like a self-destructive business all the while forgetting that postal management for decades has cross-subsidized third class, corporate commercial mail with first class mail but now opposes any cross-subsidization of, at a more modest amount, the community rural post offices that you wish to close down after the May 15, 2012 moratorium ends. Your saying that such close-downs will save $200 million a year completely ignores a greater monetary and human cost of residents having to go without or traveling miles to the next post office by millions of rural Americans already strip-mined of other essential services.
Turning to your gross neglect of a “turn-around” strategy, you have failed in your promise to focus “on selling the business” which you announced you would do when you escalated to your present position. You said it was the USPS’s “job to sell them on the mail.” Although you have received many practical ideas, some within your statutory authority, including nearly two dozen suggestions from Ruth Goldway, chair of the Postal Regulatory Commission, and others from one of the conferences on innovation held in the summer of 2010, inaction has been the only follow-up for the most part. Questions we put to you on this subject have received no replies.
Senator Bernie Sanders, among others, has mentioned some of the easy revenue ideas – an honest notary service (badly needed in an era of robo-signings), cashing most checks, selling fishing and hunting licenses, wrapping holiday gifts, or accepting wine or beer for delivery. In mentioning these revenue expanders, he also pointed to the need for Congress to free the Postal Service to enter the digital world that is draining away some of its first-class business.
But we do not hear Mr. Donahoe loud and clear on these matters, especially before Congress. We do not see Mr. Donahoe getting his assistants and encouraging its thousands of postmasters to speak out and stand up for an expanding, innovative, entrepreneurial postal service. Instead, our feedback from the field is that your constant refrain of cutting services and raising rates, together with huge losses of experienced employees, has produced an emerging perilous and costly drop in morale. You must know the operational consequences of that feeling of institutional depression. We do not see the Postmaster General rallying postal employees and gathering postal consumers to pull together for an expansive postal service. You even throw cold water on reviving the U.S. postal savings system, shut down in 1967 under pressure from the banks. At its peak in 1947, the postal savings system had deposits of the equivalent of about $35 billion in today’s dollars. Today there are over 30 million unbanked people who could use such a service provided by a delivery system in 35,000 communities – greater than the number of outlets of McDonald’s, Starbucks, and Wal-Mart combined. When we last suggested this idea, you told us you would look into it. Recently, you dismissed postal savings as not being part of the “core business” of the USPS, after the distinguished Appleseed group, with detailed expertise in the scope of the unbanked, wrote you an unanswered letter on October 14, 2011. (attached)
There is, in Washington, D.C., a combination of relentless ideological opposition to the USPS’s very existence as a public institution joined by thoughtless upper-income pundits and editorial writers who really do not use the postal service as they clutch their e-mail and text-messaging gadgets. They are both remote from the tens of millions of Americans who rely on the postal service in tangible and intangible ways that these deprecators could rarely understand or imagine. There are reporters, however, who have written compelling features from the field on what would happen were a rural post office closed to the people (many of them elderly) living there.
Which constituency are you obliging here?
If you truly wanted to be responsive to postal customers, there is a simple action that you could have taken: publicly requesting Congressional authority to establish a Post Office Consumer Action Group (POCAG). POCAG would be a non-profit group dedicated to representing the interests of postal consumers. Several million people would join, and all that is required would be a simple law directing the Postal Service to send residential postal patrons a letter periodically (perhaps twice per year), which would give them the opportunity to pay a small amount of dues to join and support POCAG. This would not only encourage greater organization and consumer participation in the services the postal service provides, but also in the crucial decisions the Postal Service makes regarding how to best provide those services.
Private corporations pay huge sums for focus groups that help them make business decisions and be responsive to consumer sentiment. A self supporting, non-profit POCAG could, among other things, function as a ready-made focus group that the USPS could help assemble at a minimal cost. After all, the Postal Service has already delivered postcards to all residences nationwide carrying postal promotional messages from cartoon characters – the periodical POCAG letters would certainly be no more burdensome. If you and your immediate predecessor were concerned about postal customers, POCAG is an idea that would have been implemented by now. Instead, it is telling that this important reform remains missing in any discussion of postal consumers.
You are not setting a personal example as you push for unjustifiable cuts. In 2011, despite Congressionally manufactured deficits for the USPS and real deprivations, the value of your compensation package was nearly $400,000. This is nearly double what Treasury Secretary Tim Geithner and Defense Secretary Leon Panetta made in the same year. Granted you were not spending $675 million in 2011 just to guard the U.S. Embassy in Baghdad. And granted you are running the only major institution – whether governmental or corporate – that receives no money from the Federal government (e.g. tax revenue or corporate welfare) and is a major net creditor of Uncle Sam (a status you should tout more). But, together with other Postal Service executives with annual base pay of over $200,000, how can you damage your moral authority to govern by asking so many people inside and outside the USPS to bear the burden of contraction but not yourselves?
Whether it is in asking consumers to pay more for poorer services, or in slashing postal employee’s jobs and hours, in closing postal facilities and denying the surrounding communities that relied on them, in cutting off citizens throughout the United States who do not have access to the internet from the outside world by closing post offices, or simply proposing cutting services across the board, a leader leads by example, not by exempting himself and his executives from any sacrifices.
Take a couple hours some weekend and stroll slowly through the National Postal Museum only a few blocks from your office. Absorb how previous leaders of the Post Office overcame enormous barriers and hurdles to build and expand the services in the 18th, 19th, and early 20th century – even delivering farmers’ eggs. The internet challenge, if the USPS were to participate and provide services, is modest compared to the mountains that the earlier postal service had to climb.
Returning from your visit to the Museum, you may wish to ponder our recommendation that you resign and request that President Obama, who needs to visit this Museum as well, nominate someone who can lead, inspire, and expand the Postal Services of this nation in the 21st Century, while achieving efficiencies that advance rather than retard the mission of the USPS. A leader with vision who can revitalize a mismanaged operation and use the feedback suggestions from your own employees solicited through the Voice of the Employee (VOE) survey.
In a phrase, you are not up to the job!
P.O. Box 19312
Washington, D.C. 20036
1600 20th Street NW
Washington, D.C. 20009
Director, National Priorities
P.O. Box 70037
Washington, D.C. 20024
1319 F Street NW, Suite 302
Washington, D.C. 20004
P.O. Box 19405
Washington, D.C. 20036
Public Health Activist