Recently Congress has deliberated on suggestions for cuts to the United States Postal Service system, which is presently losing billions of dollars each year, with a $3.3 billion loss in its 2012 fiscal year, according to a USPS news release. Part of the suggested plan, made by the USPS itself and advanced by Postmaster General and CEO Patrick Donahoe, calls for the closing of approximately 3,700 post offices nationwide.
Sen. Claire McCaskill, D-Missouri, has responded to these suggestions with a plan to keep post news release. According to the release, the proposal Congress is considering would close 167 post offices in Missouri, many in low-population, rural areas.
As honorable as McCaskill’s intentions might be, her office’s response is ignoring the logistics of the situation, which point to the futility of keeping rural post offices open in the face of severe financial losses.
According to the USPS press release, while operating expenses have increased by 1 percent, or $17.8 billion, and transportation expenses have increased by 6.3 percent, or $105 million, mailing services revenue excluding first-class mail parcels has decreased by 2.9 percent, totaling $14.5 billion for the 2012 fiscal year. The USPS has projected it will lose a record $14.1 billion by the end of this year, according to the Washington Post. The fact is, the USPS is bleeding financially, and it won’t be getting better soon.
Although the closing of post offices in rural areas might impact those residents, it is illogical to keep them open given the present costs. The proposed closings might force residents out of their jobs, but it is simply not viable to keep these jobs alive when the USPS cannot afford it. Additionally, the negative impact to rural communities seems to be a necessary cost given the plan projects savings of $6.5 billion a year, according to the Washington Post. In that same article, Donahoe said the USPS would be able to repay its $12.9 billion debt to the Treasury and be profitable again by 2015.
Although it is an unfavorable situation for rural residents, alternatives to receive mail, such as FedEx, will still be available. More importantly, the USPS has a plan to mitigate the loss of postal offices: 2,500 of the 3654 sites listed for possible closure will be replaced by a local stores, gas stations, libraries or town halls that will offer alternative postal services in a business model described as a “Village Post Office,” according to the Washington Post. Those individuals who lose their jobs will be able to reapply for jobs with the postal service again, though not all will be guaranteed to return.
In the end, the long-term benefits of the USPS plan far outweigh the short-term benefits McCaskill has in mind by keeping rural post offices open. Although her effort is well-intentioned, it is based on sentiment and obsolete values rather than rational decision-making. The USPS needs to be allowed to dig itself out of its financial hole rather than dig deeper into it.