The President gained support of small online sellers when he advocated raising prices of postage for packages coming from China, but those same sellers may disagree with his latest thinking on shipping rates.
President Trump wants the USPS to raise prices package and shipping rates - by approximately four times, he said in April, according to the Federal News Network
That fact that the USPS has financial woes is not in dispute, but the reasons why and what to do about it are.
The USPS reported the results of its most recent fiscal quarter on Friday. It grew revenue 3.2% ($17.6 billion). But its losses are enormous, even though it lost less in the recent quarter - $2.2 billion compared to a net loss of $2.3 billion for the same quarter last year. (The controllable loss for the quarter was $1.5 billion, compared to a controllable loss of $1.1 billion reported for the same quarter last year.)
In announcing the results, the new Postmaster General and Chief Executive Officer Louis DeJoy said, "Significant declines in our mail volumes as the result of the pandemic were largely offset by corresponding growth in our package business, but the reality remains that the Postal Service is in a financially unsustainable position absent significant fundamental change."
And he's made big changes since taking the helm of the Postal Service on June 15th. As we reported on July 12, postal workers were reporting new practices that the Letter Carriers union said "substantially" altered delivery practices and procedures - without union approval - and that some believe are causing delays in mail delivery.
DeJoy also announced a major reorganization of the Postal Service on Friday along with a management hiring freeze. Postal News
called it a "Friday Night Massacre" and pointed to a Washington Post article that said 23 postal executives were reassigned or displaced.
The new Postmaster General is being scrutinized given his ties to the President, and the Washington Post
pointed out that DeJoy and his wife hold between $30 million - $75 million in assets in USPS competitors or contractors.
In opening remarks at Friday's USPS Board of Governors meeting, DeJoy called on Congress to enact reform legislation that addresses the Postal Service's "unaffordable retirement payments" (he said he also wants the USPS to integrate health benefits with Medicare).
He wants the Postal Regulatory Commission to resolve the 10-year review, and a design a more rational regulatory system for mail products.
But, he said, "We will not and cannot wait for the legislative and regulatory process to save us."
And while the President has said he wants postage rate hikes, DeJoy said, "There are competitive alternatives to every product that we offer, and for that reason high-quality, reasonably-priced service is an absolute necessity."
The USPS cannot unilaterally change postage rates for dominant products (for example, the price of a stamp), but it has more leeway with changes to rates for competitive products, such as Priority Mail.
If you use the USPS to fulfill your online orders, let us know if you're seeing any slowdown in mail delivery, and if you think there's room to raise rates for the services you use.