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What's Going on at the USPS?

By Lon Robinson

There's been a number of misleading reports about the USPS® in the past few years. People are talking about privatization, saying the USPS loses money every year and may need a bail out from Congress. Actually, only one of these things is true. The USPS is losing money each year. But they are doing rather well with the costs they can control. The real issue involves congressional mandated payments. As long as they are in place, the financial losses will continue.

Privatization

It is not likely that the USPS will become a private company, and if it were to happen, it will not be anytime soon. First, it would take an act of Congress to privatize the USPS. The USPS was created by a congressional act and it would take another one to allow it to become private. There are not likely any companies who would want to purchase the USPS as a private entity. While parts of USPS's services are perhaps attractive for private buyers, who would want to be required to deliver a letter to Alaska for the price of a first class stamp? The Postal Service comes with a tremendous amount of overhead, and certain aspects, like six-day delivery, are required by law. These are not requirements that a private company wants to deal with.

Who is Running the USPS Today?

The Postal Service finally has a full Board of Governors after years of having too few to no members on its board. Having a fully seated board will allow the USPS to function much more effectively. Postmaster General (PMG) Megan Brennan announced her retirement, effective Jan. 31, 2020. At the request of the Board of Governors, she delayed her retirement date to allow them more time to find and name her replacement. Ms. Brennan has done a tremendous job as PMG. Tension and the Envelope Manufacturers Association (EMA) did not always agree with her policies, but we do believe she worked hard to keep the USPS on track and moving forward.

New Pricing in Effect

Each year, new postal rates go into effect in late January. The effective date in 2020 was Jan. 26. The increase was an average of about 2% to all classes of mail, which is equal to the 2019 increase in the Consumer Price Index. There wasn't an increase in the price of a first class stamp this year, but all automation rates increased.

Tension is a long-standing supporter of our industry partner, the USPS. Check our blog for more articles about the USPS, including some on the the 2020 promotions. You can also contact a Certified Postal Partner sales expert at Tension to learn more.

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