In an effort to stanch their $16 billion-per-year bleeding, the U.S. Postal Service plans to stop delivering regular mail on Saturdays. But will that be enough to prevent the end of mail?
The signs of snail mail's decline are all around. Rural communities are having trouble coping with drastically limited service hours—if they have a Post Office at all. Around 168,000 postal worker jobs have been cut since 2006. Branches like this gorgeous old location in Manhattan's Chelsea neighborhood are going up for sale. And the picture painted by Postmaster General Patrick Donahoe in this morning's press conference was not rosy. USPS lost $16 billion last year alone, and has defaulted on $11 billion in employee health payments. Donahoe admitted, "We're at the end of our borrowing authority." If no action is taken, CFO Joseph Corbett says the Post Office won't last beyond October 2013.
The plan Donahoe proposed today would cut Saturday delivery of all first-class mail (bills, correspondence, periodicals, catalogs, etc). People would still get their prescriptions and packages on Saturdays, but all other deliveries would be scaled back to five days a week. The move is expected to save $2 billion annually, the equivalent of 22,000 full time jobs. But many emotional observers and citizens remain split on whether or not this will be enough to save the beloved U.S. Postal Service. Depending on who's talking, you'll either hear that the American institution founded by Benjamin Franklin remains as crucial as ever—or you'll hear that thanks to the Internet, it's about to go the way of the fax machine.
You might think Post Office partisans would lament Saturday delivery cuts, but they're actually cheering on the cost-cutting move as a way to appropriately size the USPS for a world where digital communication has supplanted a good chunk of postal correspondence. Saturday cuts probably won't seal all the Post Office's wounds, but those rooting for the institution say it's a necessary first step. And they're glad to see the USPS getting tough on Congress. In his long, rousing defense of the USPS, Esquire's Jesse Lichtenstein noted that, "more than 70 percent of those losses were for extraordinary budget obligations mandated by Congress." Remember that the Post Office receives no tax money, and is completely funded by the cost of postage. However, being a government service, Congress gets to legislate how (and most controversially, when) the Post Office doles out employee health and retirement benefits. In short, Congress has tied the Post Office's hands when it comes to budgeting, and that's part of why Reuters' Felix Salmon likes the plan to cut Saturday deliveries so much. Postmaster Donahoe didn't ask lawmakers for permission to make this money-saving move, knowing full well that their foot-dragging could doom the USPS to insolvency:
Today’s announcement says to me that relations between the Post Office and Congress have deteriorated so much that the Post Office has given up on getting Congressional buy-in for its plans. At the same time, the plans are necessary (sufficient is a different question) if the Post Office is going to survive for decades to come. And so the Post Office is just going ahead with what needs to be done, and has decided to treat Congress as an adversary, rather than as a key partner in its evolution.
Esquire's own Nate Hopper agreed that the plan is "a fantastic step towards saving the vital institution." But plenty of others think Saturday cuts represent the last thrashings of a beached whale. Donahoe himself admitted that paying bills online is just easier for most Americans. "You can't bear free," he shrugged. ReadWrite tech writer Brian Proffitt is one of the many voices appealing to the creative destruction argument, saying that the Post Office's demise is the expense we pay for better online communication:
If you went back 15 years, it would hard to imagine five-day mail delivery, yet here we are, with a proposal that makes sense. Personal mail delivery has fallen drastically since the advent of e-mail and social media networks that replace the letters we once received and sent to loved ones or businesses, to the point we won't even miss it.
The National Association of Letter Carriers—another party spelling the end of the USPS—offers a far less futuristic argument. The union released a statement following Donahoe's press conference, saying that the Postmaster General's "slash-and-shrink approach" will "doom the USPS to failure."
Any way you slice it, the financial situation looks pretty dire for the Post Office. And barring a trendy resurgence in pen pal correspondence, online communication will continue eating into its business. But as Lichtenstein's Esquire feature noted, each of us Americans got approximately 508 letters, packages, and magazines delivered to our doors by the Post Office last year. Many of those things—including packages and prescriptions—aren't e-mailable. Perhaps warnings about the death of the Post Office are premature. As Donahoe enjoyed pointing out in today's press conference, doomsayers thought the Post Office was finished back when it reduced delivery from twice to once a day. Yet here we are, still opening our mailboxes to find Netflix DVDs, bills, packages from Amazon, and birthday cards from grandma.