More Republicans should support crisis aid for the Postal Service
The U.S. Postal Service has handled an astounding surge in package demand as millions of Americans have come to rely on home deliveries of food, medicine, and other essentials during the crisis. But the pandemic has also led to plummeting mail revenue and rising labor costs. COVID-19 has sidelined thousands of frontline postal workers, and as of the end of June, at least 69 had lost their lives to the virus.
A bipartisan group of senators recently introduced an emergency relief bill to allow the Postal Service to continue providing essential services. The bill offers up to $25 billion to cover crisis-related losses and ensures access to a line of credit. The House approved similar postal aid in May as part of a broad stimulus bill.
Sen. Susan Collins of Maine introduced the Senate bill, with support from fellow Republican Sen. Steve Daines of Montana and a handful of Democrats.
It’s hardly surprising that senators from two of the most rural states are leading this effort. Rural residents benefit the most from the Postal Service’s mission to provide service at uniform and reasonable rates to all 157 million U.S. addresses, no matter how remote. Revenue from more profitable services is used to cover the cost of deliveries to far-flung locales, from Maine islands to Rocky Mountain villages.
By contrast, UPS and FedEx already charge more for deliveries to rural and suburban ZIP codes that are home to approximately 70 million people. Without competition from the public Postal Service, for-profit firms would likely hike fees or halt deliveries altogether on less profitable routes.
But while the Postal Service is a particularly important lifeline for rural residents, lawmakers from more populated areas have no excuse for forcing a public agency that serves all Americans to the brink of insolvency. The Postal Service plays a critical role in e-commerce across the country by handling the last leg of a significant share of Amazon and other private carriers’ deliveries.
And, in a pandemic election year, it’s also the only entity that can manage the expected boom in mail-in voting.
Some Republicans, however, recently questioned the need for postal aid and requested a revised economic projection in light of increased package revenue (up 58 percent in May compared to the same month in 2019). While UPS, FedEx, and most other private corporations gave up financial forecasting months ago, USPS agreed to play the guessing game.
Maintaining that a liquidity crisis is “inevitable,” postal officials now wager they’ll run out of funds sometime between March and October 2021, depending on the rate of economic recovery. That’s a longer timeline than before, when they’d projected a shortfall as early as September 2020. But while the package boom is propping up revenue temporarily, it’s increasing labor costs and putting huge wear and tear on an aging vehicle fleet.
Next time you spot one of those boxy white delivery trucks, consider this: their average age is 28 years. Designed before e-commerce was even a thing, these gas guzzlers have such limited capacity for packages that carriers frequently have to reload multiple times to complete their delivery route.
Throughout its history, the Postal Service has been a driver of innovation — including in times of crisis. Rural free delivery began during the Panic of 1896, and parcel post, which laid the foundation first for catalog sales and today for e-commerce, helped stimulate the economy during the 1913 recession.
Not once during our current crisis have postal workers wavered in their commitment to meet the surging demand for their essential services — despite significant risks to their own personal health. Now it’s time for lawmakers to work across the aisle to help the Postal Service get us through these dark times and come out the other end better prepared for future challenges.
Sarah Anderson directs the Global Economy Project and co-edits Inequality.org at the Institute for Policy Studies.