The Times West Virginian

December 29, 2013

Another rate hike won’t fix issues faced by Postal Service

Times West Virginian

— Earlier this year, when Postmaster General Patrick R. Donahoe announced that the U.S. Postal Service would no longer have home delivery of mail on Saturdays in an effort to save $2 billion per year, we applauded the decision.

We knew it wasn’t an easy decision for the Postal Service to make. And we knew it would be met by skepticism and people voicing fears of “particularly harmful” impacts on rural America.

But we also knew it was a good move, considering the service suffered a loss of nearly $16 billion last year. And we acknowledged that sometimes sacrifices would have to be made. Giving up the home delivery of mail one day each week seemed like a small compromise that could have had positive financial effects.

So we were disappointed when, just a few weeks after announcing the plan, the Postal Service said it would cancel its plans to end Saturday mail delivery due to the new stopgap budget Congress had passed that would prohibit the move.

Our disappointment grew last week when regulators approved a temporary price hike of 3 cents for a first-class stamp, bringing the charge to 49 cents a letter.

Regulators hope the increase will help the Postal Service recover from severe mail decreases brought on by the 2008 economic downturn and ultimately save money. We think the increase could have been avoided if the Postal Service had been permitted to stick to its original plan of cutting home delivery of mail on Saturdays.

Think about it. The cost of first-class stamps already jumped once this year — to the 46-cent cost regulators just approved another increase for — while postcard prices went up to 33 cents. That was the fifth increase since 2006; last week’s marked the sixth.

Eliminating one day of home delivery would have cut down on the need for such frequent increases, ultimately saving each of us money every time we pay a bill, send someone a birthday card or mail a postcard while we’re on vacation.

Instead, individuals will have to pay the higher rate when it takes effect Jan. 26. Regulators say it will last no more than two years, though they stopped short of making the price increase permanent.

We all know the Postal Service has been struggling in recent years. It lost $5 billion in the last fiscal year and has been trying to get Congress to pass legislation to help with its financial woes. The post office has struggled for years with declining mail volume as a result of growing Internet use and a 2006 congressional requirement that it make annual $5.6 billion payments to cover expected health care costs for future retirees — of which, three payments have been defaulted on.

Regulators can keep approving small rate increases. But it’s clear that these “temporary” steps are not working. Instead of changes that make sense, we’re being forced to hand over more cents.

It’s time for a better plan.