Mailer Groups Laud Presidential Commission on USPS

Most observers applauded President Bush’s creation of a commission to explore the U.S. Postal Service’s mission and operations. But some news reports suggested that the plan was merely a disguised call for privatization of the USPS, displeasing at least one group.

“I’m not sure that privatization is a good idea,” said Bob McLean., executive director of the Mailers Council. “The postal service has so much debt, who would want to buy it?”

In addition, the Main Street Coalition for Postal Fairness urged the commission to “ensure the Postal Service stays on mission and does not compete with the private sector.” It also argued that the USPS must “maintain universal postal service at reasonable and nondiscriminatory rates.”

The nine-member commission will study the state of the USPS and make recommendations to the President by July 31, 2003. It will be co-chaired by Harry Pearce, chairman of Hughes Electronics and James Johnson, former CEO of Fannie Mae and the current chairman of the Brookings Institution, a Washington think tank.

Sources said the review could result in the first major overhaul of the postal service since its creation during the Nixon administration in the early 1970s. Specifically, the Commission will look at:

*The USPS’s flexibility to change prices and control costs in response to financial and competitive pressures

*The USPS’s ability to maintain universal service over the long term

*The extent to which the postal monopoly restrictions continue to advance public interest

*The rigidities in cost or service that limit the postal service’s effectiveness.

Most industry comment was favorable.

“We are pleased that the President is now engaged on the critical issue of postal reform,” said H. Robert Wientzen, CEO of the Direct Marketing Association, in a statement. “The commission should focus on constructive recommendations that will guarantee the continued viability of the postal service, which is a vital a cog in our nation’s economy.”

Neal Denton, executive director of the Alliance of Nonprofit Mailers, predicted that “thoughtful reforms will increase the momentum of economic recovery for America’s nonprofit organizations that rely upon the Postal Service.” He noted that mailing represents nearly 9% of the gross domestic product.

Even groups not necessarily involved with direct mail applauded the move. The Magazine Publishers of America called the move “a critically important step toward postal reform–a course of action that we and other postal-dependent industries have strongly urged him to pursue.”

And John F. Sturm, CEO of the Newspaper Association of America, added that ” the president has taken a big step in restoring public confidence and accountability in a postal system that, in some respects, has lost its way.”

Despite its fear that the USPS will compete with the private sector, the Main Street Coalition for Postal Fairness called the commission “the most viable strategy for addressing the USPS’s future.”

And McLean, head of the Mailer’s Council, said he was pleased with the White House’s has formed the commission and is taking the problems of the USPS seriously.

Postmaster General John E. Potter welcomed the creation of this presidential panel, noting that “the commission is good news coming at the right time. We look forward to assisting in every way possible.”

He pointed out that a similar commission, the Kappel Commission, resulted in the business model of today’s Postal Service which was embodied in the Postal Reorganization Act of 1970 that created the Postal Service in 1971.

That commission, he said, established a model which yielded unprecedented improvements in service and efficiency. Stamp prices did not increase at all in that period, when adjusted for the effects of inflation. Even though mail volume doubled and the number of delivery addresses increased by more than 60%, the size of the postal workforce increase by only 6%.

But the PMG asserted that times have changed, and that the 1970 model, which assumed continuous mail growth without competition and new technologies, does not adequately address today’s needs.

The commission members include:
*Richard C. Levin, president of Yale University
*Dr. Dionel Aviles, president of Aviles Engineering Corp.
*Don V. Cogman, chairman of CC Investments
*Carolyn A. Gallagher, former president/CEO Texwood Furniture
*Norman Seabrook, president of the New York City Correction Officers’ Benevolent Association
*Former Congressman Robert Walker (R-PA), chairman/ CEO at Wexler Group
*Joseph R. Wright, president/CEO of PanAmSat