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A 40 percent postal rate increase is bad for Americans, bad for the Postal Service

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The Postal Regulatory Commission (PRC) may not be top of mind to most Americans, but the decisions they make affect each and every one of us. For more than a decade, the PRC has provided oversight of the United States Postal Service and its pricing. And now, the PRC wants to drastically increase postal rates in a move that would be devastating.

The PRC is an independent agency with representatives from both political parties: Robert G. Taub (R); Tony Hammond (R); Mark Acton (R) and Nanci E. Langley (D). They aren’t household names, but they have the final say in determining how much consumers, nonprofits and businesses pay to use the Postal Service.

{mosads}As part of its 10-year review of postage rates, the PRC is proposing an enormous rate hike that would raise rates by as much as 40 percent on those of us who rely on the mail to connect with communities, raise funds for non-profits and conduct business. The PRC does not believe that mail volume will go down significantly if prices go up. That is simply not true. A rate increase of such magnitude would likely destabilize national mail operations and could even force local newspapers, charities, catalogues and magazines out of business entirely. Any previous notions of volume falloff being “modest” if rates went up are no longer relevant with a 40 percent increase in prices.

The PRC’s proposal is so alarming because it’s not just bad for those who rely on the mail, it’s bad for the Postal Service itself. If businesses are driven away from using mail, that leads to less mail, less revenue and a weaker Postal Service for everyone. The PRC needs to find a long-term solution that assures the survival of the Post Office and balances the needs of consumers. The Postal Service’s remaining customers should be encouraged to stay with them—not penalized with higher rates and driven away.

There are countless, common sense reforms that the Postal Service should make to adapt to today’s changing economy without sacrificing quality of service. But instead of tackling those challenges head on, the PRC is basically demanding the American people foot the bill for their shortsightedness. What business in its right mind would massively increase rates while losing customers? None. But that’s exactly what the PRC is proposing.

In the industry I represent – magazine media – USPS is the only partner whose costs have increased in recent years. The cost for all other periodical manufacturing elements has gone down – paper, ink, printing – even the cost of freight has gone down. At the same time, USPS productivity has fallen as much as 50 percent over the past decade. And the cost of processing magazines has doubled thanks to the introduction of less efficient preparation methods at the Post Office.

What’s more, the PRC is exceeding its authority by raising rates well above and beyond what is prescribed in the 2006 law. When Congress passed the Postal Accountability and Enhancement Act, they made it clear that rates shouldn’t increase faster than the Consumer Price Index (CPI). The PRC is proposing a rate hike by as much as four times the CPI—a clear violation of the statute.

Our unprecedented coalition of more than 80 groups – from the Wounded Warrior Project to my organization, MPA – The Association of Magazine Media – has come together to take a stand against the PRC’s dangerous plan. We are united by a shared desire to ensure that the Postal Service thrives. The Commission’s proposal will not solve USPS’s financial problems, and will cause lasting damage to the Postal Service and to the $1.4 trillion mailing industry—and the 7.5 million jobs it supports.

The mission of the PRC is to “ensure transparency and accountability of the United States Postal Service and foster a vital and efficient universal mail system.” People love the United States Postal Service and the benefits it provides. But when it comes to rates, we insist the PRC live up to its mandate. Efficiency needs to be a key consideration in any postal reform. The PRC should demand higher productivity from the USPS before imposing punitive rate hikes on consumers and those who depend on the Postal Service. Only then will we achieve the truly efficient universal mail system that can prosper in the future.

Linda Thomas Brooks is president and CEO of MPA – The Association of Magazine Media.


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