The fiscal cliff and what will really happen when it is reached is actually not the biggest thing in the news. The biggest thing this week is whether VP Joe Biden was making a slave reference in a recent speech. Once again, our politicians have figured out a way to make something that is ridiculous into a major event so they can all not focus on things that are important.
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Want to see the typical response in Congress to a real crisis? Let’s take the Post Office. The USPS just defaulted on a $5.5 billion debt and will default on another $5.6 billion-plus in about a month with no action. This is a crisis at one of the most venerable institutions, and for the record I have lived all over the world and believe we have one of best postal services in the world.
This is a harbinger of the fiscal cliff, and how does Congress respond? Do they address with tough and bipartisan measures or do they just kick the can until after the election?
Wrong on all accounts. Congress looks at this mounting crisis and the pleas from Post Master General Patrick Donahue to allow him to do what he needs to not run out of money and (drumroll please) … Congress takes a five-week vacation.
There are hundreds of thousands of employees at stake and our Congress takes a vacation and lets the political leaders argue over a Joe Biden gaffe. (Or was it a gaffe? I guess that’s the argument to be made so things like the Post Office problems are not addressed).
What should we do? First, we need a Congress with a backbone to deal with this, and since right now we don’t even have a Congress (on vacation) let’s just fix things in this article, and hope that while on vacation one of these guys who form the worst Congress in history will read this.
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The Post Office needs to reduce hours or close thousands of rural post offices and about half of its mail processing centers. USPS also wants to lay off as many as 200,000 employees (100,000 through layoffs and another 100,000 through attrition). Both of these are political nightmares and no politician wants to deal with these issues, so they just go on vacation.
There is an argument that the USPS is saddled with unrealistic pension obligations and that it has to finance too much of its obligations too far in advance. While there is some merit to this argument, it sounds very familiar to the Unified Budget argument in 1968, with the Lyndon Johnson administration, that Social Security had so much money it would never all be spent. So, it got added to the general budget and the money was subsequently stolen over the next several decades by politicians who saw this as a way to give everything to everyone and worry about the future at some later date.
How to fix the USPS? Stop Saturday delivery. Close or reduce the hours of the USPS locations in question and sell the real estate. Open branches in banks or Wal-Marts for the rural business. Address the pension issue -- these folks who deliver mail have been doing their job and if they were promised something than they should get it.
Then renegotiate both the pensions and the way they are paid.
The dumbest thing I have heard is the argument that the way the pension is funded is the only problem. Email and social media have a lot to do with that business model changing, but again it takes the debate away from the fact that even without the pension obligations this institution is losing billions annually.
Decide if this is a business or not, and if it is then run it like one. If it is not, then run it efficiently (I would argue impossible if it’s by the government) and don’t allow it to compete with UPS and FedEx. I find it reprehensible that USPS is subsidized by Congress, competing with two of America’s biggest employers with a subsidized rate.
We fight other governments subsidizing business as unfair yet we do the same thing here with USPS against UPS and FedEx.
I am 100% for the USPS, however, I believe that Mr. Donahue should be allowed to do the job he was hired to do: bring the USPS into the 21st century and keep it as the proud American institution that it always has been.