Proposed Postal Reform Hurts Postal Consumers Without Service Improvement

Today, the House Government Oversight Committee will be marking up a bill introduced by Chairman, Jason Chaffetz and the committee’s Ranking Member, Elijah Cummings that would provide an outsized bailout to the United States Postal Service on the backs of postal consumers. Since 2007, the U.S. Postal Service has generated $56.8 billion in financial losses and currently has $125 billion in outstanding debt and unfunded liabilities. A discussion draft with the intention of providing financial relief for the troubled agency was introduced last month to very mixed reviews.

Steve Pociask of the American Consumer Institute provided this statement about the introduced bill:

“As introduced, the Postal Service Reform Act of 2016 introduced by the House Oversight and Government Reform Committee does not solve the root causes that plague the U.S. Postal Service and further burdens all who depend on their service for letter mail. The bill allows the U.S. Postal Service to unjustifiably raise postal rates, which subverts the USPS’ rate-setting process with the Postal Regulator. This proposal benefits the Postal Service’s ill-advised forays into exploratory markets, which have had a negative impact on postal consumers and proven to be debt drivers for the financially troubled agency. True Postal Reform would call on USPS to meet its performance standards on letter mail and focus more directly on these highly profitable products to help the agency recover from financial ruin.”

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