At their union convention in Minneapolis, U.S. postal workers argued against a costly retiree benefit funding provision.
Minnesota delegates, front, joined 9,100 postal workers attending the 68th National Association of Letter Carriers Biennial Convention on Thursday at the Minneapolis Convention Center. The union blames Congress for requiring the Postal Service to set aside billions to prefund 75 years of retirees’ health benefits.
Your mail carrier feels threatened, and with good reason.
As the U.S. Postal Service searches for a sustainable business model, more than 9,000 mail carriers descended on Minneapolis this week for the biennial convention of the National Association of Letter Carriers.
As a group, they are worried. They feel misunderstood. They're riled up. They donned red T-shirts, voted on a raft of resolutions, listened to speeches from politicians and union leaders, and called for the head of Patrick Donahoe, the postmaster general.
"Dump Donahoe! Dump Donahoe! Dump Donahoe!" the crowd in the cavernous Minneapolis Convention Center chanted for 30 seconds before the association's president, Fredric Rolando said, "OK, I think we get it."
But Donahoe is not the real problem, if you ask Scott Dulas, a mail carrier in east Duluth who had a street on his route washed away by the June flood. He places the blame for his employer's financial problems squarely at the feet of Congress.
Lawmakers decided in 2006 that the Postal Service should prefund retiree health benefits 75 years in advance, a decision that costs the Postal Service $5.5 billion per year. This, said Dulas, is the problem.
"I have full confidence in my brothers and sisters here," Dulas said, waving at the sea of red spread out before a white stage flanked by giant projector screens. "Who I don't have confidence in is the people who created the problem, and that's Congress."
That was the prevailing view at the convention, attended by delegates representing about 180,000 mail carriers in 50 states and three U.S. territories. If only Congress would lift the burden of retiree health benefit prepayment and let the Postal Service tap into the funds, the agency could figure out its other problems, the argument goes.
"It's scary," said Jason Karnopp, a Minneapolis letter carrier who works for the union. "The Postal Service is threatening to close hundreds of facilities, which has the potential to affect 80,000 letter carriers."
But the agency's problems run deeper than the prefunding requirement.
The Postal Service has lost $10.5 billion in the past three years apart from the prefunding requirement, expects to lose $5.4 billion in 2012, and projects it will lose $15.5 billion in 2016. Those losses are separate from the prefunding requirement of $5.5 billion per year, which the agency delayed in 2011, putting itself in position to pay $11.1 billion in 2012.
By the Postal Service's own admission, the biggest challenge is the Internet's effect on first-class mail. Until the mid-1990s, the volume of first-class mail sent in the U.S. roughly tracked GDP. With the rise of the Internet, first-class mail leveled off. In the 2000s, volume declined by 45 billion pieces, and that trend has profound impact on the agency's finances. First-class mail accounted for 49 percent of revenue in 2011.
Rolando has pointed out that delivery of packages and parcels is growing. But that revenue stream is not growing as quickly as first-class mail dries up.
This forced Postal Service leaders to come up with plans to cut costs, including closure of 13,000 post offices mostly in rural areas. That plan was abandoned in May, giving Congress time to come up with a financial overhaul for the agency.
The union believes that getting rid of the prefunding requirement would give the Postal Service the room it needs to address its other problems.
Lawmakers now have in front of them two options. On one hand, they could allow the Postal Service to end Saturday delivery and close post offices across the country. On the other, Congress could let the agency tap into the money it set aside for retiree health benefits.
BaLynda Schweitzer, a mail carrier in New London, Wis., would prefer the second option.
She substitutes on mail routes in the town of 7,000 an hour west of Green Bay. She exchanges jokes and Laffy Taffys with a little boy at one of the homes. One of her customers lets the dog out to walk with her for four blocks, every time she walks past.
"He would follow me for the whole route," she said.
Schweitzer said post office closures would have a disproportionate impact on rural communities, the elderly, people who need medicine delivered to their door.
"The dysfunction of Congress is what is making this happen," Schweitzer said. "It's not just about my paycheck, it's about fighting for the working class everywhere."
Adam Belz 612-673-4405