WASHINGTON, D.C.—Postmaster General Louis DeJoy presented a 10-year plan to “save” the U.S. Postal Service (USPS) March 23. Entitled “Delivering for America,” the 58-page plan would slow first class mail delivery, reduce post office operating hours, and raise prices. The plan also calls for ending a congressional mandate to pre-fund retiree health care, something postal unions have also been calling for. That requirement costs USPS nearly $5 billion a year.
DeJoy is a corporate executive and big Republican donor who was named postmaster general last May by Trump appointees on the USPS Board of Governors, despite concerns about financial conflicts of interest. DeJoy and his wife have more than $30 million invested in XPO Logistics, a Postal Service contractor, and as much as $300,000 invested in United Parcel Service.
Postal unions were critical of parts of DeJoy’s plan for the USPS and its 644,000 workers. Most USPS employees are union members, and many of them veterans.
The unions agree with DeJoy’s proposals to repeal the requirement to pre-fund retiree health insurance, and to preserve six-day and seven-day mail delivery. Postal unions have noted that without the $5 billion yearly prepayment on health insurance—something no other company or federal agency is required to do—USPS would turn a profit most years.
They agree too with DeJoy’s proposal that new postal retirees be integrated into Medicare, another money-saving measure. They also welcomed DeJoy’s promise to replace the USPS’ decades-old vehicle fleet with an all-electric fleet by 2035, to open 46 new sorting centers to handle the USPS’ growing—and increasingly profitable—package delivery business, and to modernize local post offices.
USPS delivers nearly half of global mail volume. With its nationwide network delivering to every home and business, USPS handles the “last mile” of package delivery not just for itself, but for private firms, notably UPS, which is unionized, and FedEx, which isn’t. Those “last miles,” especially in rural areas, aren’t profitable, the private firms say. DeJoy estimated the package delivery upgrade would earn USPS a net of $24 billion over the next decade.
But DeJoy also proposed “setting new delivery standards” for first-class mail, still the USPS’s prime money-maker despite the pandemic downturn and prior shifts of business to the Internet. DeJoy’s proposal to set a 70% standard for first-class delivery “within three days or less,” would be a worsening of current standards.
That drew congressional ire. Rep. Gerry Connolly (D-Va.), whose Oversight panel’s Government Operations subcommittee would have the House’s first crack at postal legislation, said DeJoy’s plan “guarantees the death spiral of the United States Postal Service.”
“Customers and Congress are fed up with DeJoy’s service cuts and record delays,” Connolly said. “The only way to right this ship is new leadership, a better vision, and a realistic plan that serves all.”
After taking over as postmaster general last year, DeJoy oversaw the removal of package sorting machines, and a reduction in overtime approvals, which resulted in undelivered mail piling up. The USPS inspector general reported that mail delivery overall showed sharp declines after DeJoy took over.
(Editor’s Note: Press Associates Inc. contributed to this report.)