I see that, as usual, the postal service is in crisis:
Last week, Senator Rand Paul used an oversight hearing on the USPS to reveal that much of its problem lies in its decision to convert 190,000 employees to permanent positions with union benefits — thus ballooning its debt. Paul told Postmaster General Louis DeJoy that he should use cheaper, contracted employees to stop the bleeding.
I have no idea where Rand Paul got that 190,000 figure. USPS is indeed starting to insource its long-haul truck routes, which have been handled by contractors for years, but inexplicably the number of long-haul contract drivers isn't public information. My best guess, based on hints here and there, is that it's maybe 50-60,000 or so.
Do unionized USPS long-haul drivers cost more than contract drivers? Beats me. Nobody at the hearing provided any evidence one way or the other. Postmaster General Louis DeJoy, a Trump appointee, told Paul "perhaps you're right," but then sort of suggested that efficiency would increase by having everything under one roof.
The postal service is a mammoth beast working under mountains of restrictions. But the underlying problem is that members of Congress are constantly saying it needs to be run like a private business but are generally unwilling to actually let it run that way. Here are a few charts to show the lay of the land. First up is delivery volume:
Delivery volume is down substantially, but the number of addresses and delivery routes keeps going up. This means the cost of delivering the mail has increased while revenues have gone down:
The postal service lost $9.5 billion last year. If it had the same operating revenue as in 2014 that would have been a $1 billion surplus. So how do you square this circle of rising costs and declining revenue? One way would be to relax the postal service's mandate for universal delivery, but Congress would never allow that. Another way would be to allow postal rates to increase a little more:
A few years ago the postal service received permission to raise rates by more than inflation—but only by a little bit. As a result our first class rates remain among the cheapest in the world:
If first class postage rose by 20 cents the postal service's $9.5 billion loss would go away. If it rose to merely the international average, it would have turned into a surplus of $9.5 billion. Any private enterprise would be able to do that, but Congress won't allow it. Constituents would complain, after all. Even regulated public utilities get a better deal than the postal service.
If Congress wants USPS to run like a private business, then butt out and let them run like a private business. Allow them to set rates and delivery standards and labor policies without a bunch of grandstanding politicians second guessing everything they do. Fat chance of that, though.