A Postal Service Fit for a Republic
By Nancy Spannaus
May 8, 2020—Over the front steps of the National Postal Museum in Washington, D.C. is engraved the following message:
Carrier of News and Knowledge
Instrument of Trade & Industry
Promoter of Mutual Acquaintance
Of peace and of good will among men and nations.
Are you surprised? This message tells you that the U.S. Postal Service was conceived to serve the republican principles that our Revolution and Constitution were based on. Now it’s high time that we reshaped our national Post Office to fulfill this commitment, as a concomitant of reviving the principles of the American System of Economics.
For almost 200 years, the Post Office Department served the General Welfare in ways most Americans today know nothing of. Did you know that, to disseminate knowledge to our citizens, the Post Office lowered the postage rates for newspapers, sometimes to nothing?[1] That for much of our history, mail could be picked up seven days a week, and delivered six days a week, often several times a day in major cities? That the Post Office oversaw the expansion of our road network, established the first telegraph service, and promoted commercial air service, thus facilitating commerce as well as communication? That for 55 years the Post Office ran a Postal Savings System that provided banking services to small investors who couldn’t get that service elsewhere?
All these activities were overseen by the Federal government, and paid for by a combination of user fees and Federal funds. They were understood as essential for creating an informed citizenry and a unified nation. They were worth the price.
The current crisis of the U.S. Postal Service has its roots in the passage of the Postal Reorganization Act of 1970, which fundamentally changed the conception of its function. This act took the first steps toward transforming the Post Office from a public utility, to a business corporation that was supposed to support itself without taxpayer money. And if the current Administration has its way, the next step will be privatization that eliminates the commitment to universal service, and further fragments a nation already tragically polarized by financial and ethnic disparities.
To do that would be a travesty, flying in the face of our Constitutional commitment to a republican form of government. The following review of the history of our postal service should make that clear.
Building the Nation
The importance of the postal service in facilitating communication among patriots in different colonies, leading up to the Revolution, is well known. The efficiency of the Crown Post, as it was called, was greatly increased by Benjamin Franklin, who was appointed Postmaster General in 1753, and proceeded to radically improve its functioning. He surveyed the northern colonies and recommended the most efficient routes, in addition to establishing delivery in relays, which included carrying mail overnight. He was also the first to establish a rate schedule; the service even began to generate a surplus.
The Postal Service greatly aided in the activities of the revolutionary Committees of Correspondence, as well as the rapid circulation of newspapers conveying important intelligence to the general population. As such, it became a thorn in the side to the British Crown, as did Franklin himself. After Franklin caused letters[2] from the Massachusetts Governor Hutchison to be published in 1773, he was fired in 1774.
The Postal Museum, in its history display, tells a story of the conflict between the Crown Post and revolutionary publisher William Goddard. Goddard was a printer in partnership with Franklin in Philadelphia. Because of his political views, the Crown Post stopped delivering out-of-town papers to Goddard, thus inhibiting his news flow, and ultimately putting him out of business.
Goddard didn’t take this lying down. In 1774 he set up his own Constitutional Post, which pledged no interference with, or snooping on, the mails, and presented a plan to the Continental Congress for its support. His plan was adopted in July 1775 after the Revolutionary War began; it resulted in Franklin again being appointed Postmaster General. The Crown Post was rapidly forced out of business.
Franklin wasn’t able to keep the job for long, of course, as he was sent off to Europe to build support for the Revolution. But his system by then covered the entire inhabited territory from Florida to Maine, as well as regular service to Europe.
A Constitutional Commitment
The importance of a mail system that would crisscross the United States territory, spread knowledge, and be free of censorship is implicitly acknowledged by the fact that the postal service is presented as a Federal responsibility in the U.S. Constitution. Article One, Section 8, no. 7 empowers Congress to “establish post offices and post roads.”
President Washington appointed Massachusetts Congressman Samuel Osgood as Postmaster General in 1789, but the Post Office Department was not permanently established until 1792, when the Postal Service Act was passed. That act included commitments to the following:
A Free Press – Under the act, newspapers could be sent through the mail at discounted rates, subsidized by the Federal government itself, to better promote the spread of information across the nation. [Freedom here means free of censorship like that experienced under the British.-nbs]
National Growth – The Act also helped shape the expansion of the nation with Congress assuming the responsibility for the creation of new postal routes to help guide settlement, expansion, and development. They wanted to use the promise of mail delivery to help grow the nation and economy instead of serving only existing communities.
Personal Privacy – To ensure the sanctity and privacy of the mails, postal officials were forbidden to open any letters in their charge unless they were undeliverable. Finally, Congress assumed responsibility for the creation of postal routes, ensuring that mail routes would help lead expansion and development instead of only serve existing communities.[3]
Post road construction took off during the first decade of our existence, resulting in dramatic increases in communication and commerce throughout the nation. At the expense of the Federal government’s postal function, roads were surveyed and built, improving transportation for business, exploration, and settlement. They were then maintained by localities, as a requirement for maintaining their status as official post roads.
The history of the Post Office Department up until 1970 reflects Congress’s ongoing concern to make communication by mail affordable and timely to the entire population. The cost of sending newspapers was constantly lowered: indeed, President Washington wanted newspapers to be sent free, as they were during certain periods of our history. The cost of postage for personal letters, initially priced very expensively, was reduced over time. Recipients of mail then had to pay their postman, who delivered to their homes, or they went to their post office to pick up and pay for their mail.
A radical change occurred during the Civil War, when Lincoln’s Postmaster General Montgomery Blair learned of an experiment initiated by postal employee Joseph Briggs of Cleveland. In 1863, after observing long lines of women and children waiting to pay for letters from their men at the front, Briggs convinced his superiors to start free delivery to their homes. When Blair was informed of this, he enforced the policy nationwide for the large cities.
Gradually, the policy of free delivery spread to smaller towns as well. Rural Free Delivery began to come into being in 1891. It represented a giant step toward equalizing access to news, information, and commerce throughout the nation. Like the Rural Electrification Administration, which brought electricity to localities that private utilities refused to service, Rural Free Delivery brought previously isolated areas of the country into contact with the nation as a whole.
The frequency of mail delivery has varied considerably over the history of the Postal Service. In 1810 it was seven days a week; most of the time it was six days a week. When the Eisenhower Administration tried to reduce it to eliminate Saturday delivery in 1957, the cut lasted only one Saturday, before political pressure led the President to submit a bill to increase funding. A similar experiment under the Johnson administration was short-lived.
When letter recipients no longer had to pay their letter carrier, payment of the postmen shifted to the Federal government, which appointed local postmasters as well. In 1889, the National Association of Letter Carriers was founded to represent the huge army of postmen around the nation. The union was created in Milwaukee, in order to coincide with the annual reunion of the Grand Army of the Republic, the nation’s largest veterans’ organization. The first NALC officers notably included William Carney, a former slave and Civil War veteran, as its Vice-President. True to these beginnings, the NALC and the post office department in general have been a major source of employment and advancement for Afro-Americans.
A review by the Post Service’s Office of Inspector General provides a fulsome report on the contributions of the Postal Service to national infrastructure development. Highlights include:
- The creation of a 150,000 miles post road network by 1840
- The operation of the first telegraph line
- Providing some regulatory control over the railroads, by designating them as “post roads” (1838)
- Promotion of commercial air service
- The establishment of a postal savings system (1911 to 1967) to provide safe banking for small savers. This was very popular during the Depression, and could usefully be revived today. A similar system is still in effect in Germany and Japan.
The Post Service also plays a security function for the nation. Ben Franklin himself established the Postal Inspection Service, which has responsibility for deterring and investigating mail crimes to this day. The comprehensive scope of the Post Office, with its knowledge of addresses, also makes it a literal lifesaver in cases of natural disasters such as hurricanes. With other communication disrupted, who else can find those isolated and in need?
All in all, throughout our history, a more comprehensive servant of the nation’s general welfare than the U.S. Post Office would be hard to find.
What Went Wrong?
The Post Office became a Cabinet agency in 1872 and remained so until the 1970 “reform.” Over that time, it operated on the principle of what the USPS report cited above called the “quantity production:” i.e., the greater the volume, the lower the unit cost. Postage was therefore kept at the lowest possible rate, to encourage broad use. That broad use included extensive use of postal services by other branches of the Federal government, which costs were attributed to the Post Office. This process helped create the Office’s operating deficits, which became a political issue in the 1950s.
These deficits provided the excuse for the Nixon Administration’s successful transformation of the Post Office Department into an independent agency, the United States Postal Service (USPS) we know today. This “reform” was proposed by a Congressional Commission (the Kappel Commission set up by President Johnson in 1968), which undertook a detailed study of the Department’s operations, including its costs. The study paid special attention to the fact that postage revenues were not covering the cost of the Department’s operation, thus requiring the Federal government to cover from 15% to 19% of the budget.
To “remedy” this situation, the Commission took direct aim at the historic purpose of the Post Office as a Federal government public service aimed at promoting the general welfare. Postal services are not like the Department of Defense or the Justice Department, which are allowed to operate at a deficit, the report argued. “Such reasoning misconceives the nature of the postal establishment… Unlike national defense or public health, however, postal services can be and always have been sold to users.” (see page 22 of the Report)
In other words, they said, the Postal Service should not be treated like the essential element of our national infrastructure, but as a business corporation, which should pay for itself. Since we can milk the users for funds, save money by reducing services, and so forth, we should do it.
This drive toward financialization did not succeed immediately. It took the nationwide postal strike of 1970, launched to protest poor wages and working conditions, to prompt the passage of the reorganization of the Post Office through the Postal Reorganization Act. The bill was sold to the Democratic Party-controlled Congress, among other things, by promising to grant collective bargaining rights to the postal unions. (It did.)
Under the Postal Reorganization Act, the U.S. Postal Department became the semi-independent United States Postal Service (USPS), which is run by a Board of Governors appointed by the President and approved by the Senate. The new arrangement removed Congress’s power over rates (it replaced by a Postal Rate Commission); subjected the service to competition in areas of mail delivery other than first and third class mail; and established the general commitment for the corporation to become self-sustaining. The USPS was also given the authority to raise capital for its infrastructural improvements, but its budget was subject to the Office of Personnel Management’s oversight.
Initially, the results had some positive results. There were increases in efficiency, as in the creation of zip codes, and improvements in infrastructure. By 1982 the USPS was no longer receiving any public subsidy, although legally this is still permitted. But with the increase in competition and the development of the Internet as a more and more popular form of communication as compared to first-class mail, the deficits re-emerged. Budget cuts (mostly cuts in personnel through attrition) did not solve the problem.
The next major step came in 2006, when, under the George W. Bush Administration, the budgetary screws were tightened even more. The Postal Accountability and Enhancement Act of 2006 set up new rules for how the USPS had to cover the cost of various competitive products, and obligated the corporation to prefund its obligations to the Postal Service Retiree Health Benefits Fund. As the USPS explains, this system contrasts with that of most corporations and government departments, which pay health benefits when the premiums are billed.
The USPS has documented that the Retiree Health Fund obligation, which required paying in the funds for past promises before they come due, was to a large extent responsible for the USPS’s operating losses in the period up to 2010. It had been obligated to pay over $5 billion a year into the Fund from 2006 to 2016, and increasingly found those payments unsustainable. Indeed, the USPS suspended these payments in 2011 (The Fund by that time had accrued a significant surplus).
The years in which the USPS paid the Retiree Health Fund took a big toll. Personnel cuts have averaged about 32,000 a year. Post offices have been shuttered as well.
The result of this overall process, which is compounded by the economic shutdown related to the current pandemic, has been predictable. The USPS is facing potential bankruptcy by the Fall. The House of Representatives passed legislation which would ease the crisis back in February (It would eliminate the prepayment requirement and forgive the USPS’s debt), but as could be expected, it is stuck in the Senate.
Meanwhile, President Trump is threatening to veto any legislation that grants money to the USPS unless it dramatically raises package rates (which would result in more business going to its competitors). And lurking in the background is the new reorganization plan put forward by a Treasury Taskforce report in December 2018, which calls for an even more drastic streamlining of the USPS, including redefining what are “essential” services for the nation as a whole, and reducing labor benefits.
In other words, the push is on to fully transform the Post Office into a business, rather than a public utility dedicated to advancing the general welfare, unity, and knowledge of the U.S. population as a whole.
The Right Approach
Just as a functioning postal service was critical to building our country, so it remains essential to its progress today. Just think where we’d be if there had been no post office to send out the coronavirus checks, or to handle the “last mile”[4] of shipments from retailers supplying food and medicine? With its mandate for Universal Service, all at standard fixed prices, the post office ensures service even in the most remote of locations. Could you rely on private services to do the same, without charging you an arm or a leg?
There has been a 37% increase in postal business since the pandemic began, and the post office, and its workers, are putting themselves in harm’s way to keep people supplied, as many Americans have to shelter in place. Could you count on a private business to do the same?
The answer is clearly no. Our Founders were right to designate the postal system as a Constitutional function serving our nation as a whole. It’s time to reconstitute the U.S. Postal Department once again.
[1] European observers, like Alexis de Tocqueville, associated this fact with the extraordinary literacy rate among white Americans in the 1830s – an estimated 91%.
[2] The letters called for the Crown to begin to ban self-government by the colonies, and station more troops in America to control dissent.
[3] This summary comes from https://www.accessible-archives.com/2011/02/the-postal-act-of-1792/
[4] The “last mile” is delivery from a postal hub to the final destination. Shipping services like UPS and Fedex often partner with the USPS to provide this service, in order to save money.