In the latest example of how Postmaster General Louis DeJoy defines “prudent and judicious,” he won Board of Governors support to seek the second price increase on market-dominant products in less than a year.  As in the prior rate hike, effective last August 29, DeJoy opted to use nearly all available rate authority.  If approved by the Postal Regulatory Commission, the new prices would mean ratepayers would have experienced price hikes of over 13% in less than a year.

In its April 6 filing, the Postal Service detailed the factors contributing to the proposed increase:

In a March 24 press release, the Postal Service announced that it had placed an order for 50,000 Next Generation Delivery Vehicles with Oshkosh Defense, the contractor it had selected last year. The total cost of the order was stated to be $2.98 billion, or about $60,000 per vehicle, although that average may include costs other than the “sticker price” of each truck. 

In a February 25 filing with the Postal Regulatory Commission, Mailers Hub joined with nine other industry groups (American Catalog Mailers Association, Association For Mail Electronic Enhancement, ANA—Association Of National Advertisers, Continuity Shippers Association, Envelope Manufacturers Association, International Mailers Advisory Group, Major Mailers Association, National Association Of Presort Mailers, and Printing United Alliance) to support a Package Shippers Association recommendation to eliminate the statutory “appropriate share” provision.

Appropriate share

This article was produced by Merry Law, Mailers Hub’s expert consultant on international mail. Merry may be reached at [email protected].

I recently wrote two articles for this newsletter on what’s happening in the international mail arena at the Universal Postal Union and at the USPS. While I try to present facts and developments in a neutral way, those reading between the lines might conclude correctly I am not optimistic about the immediate future for the international mail environment.

Attention members of the commercial mail production community: You’re being pitched. After nineteen months in office, and ten months after issuing his 10-year Plan, Postmaster General Louis DeJoy is getting out of his office at USPS HQ and taking his sales pitch to the people.

Actually, his Selling the Plan tour began last year; he appeared at selected USPS facilities, at carefully arranged Postal Customer Council meetings, and in a protracted infomercial during the virtual National Postal Forum. His most recent venue to win friends and influence customers was last week’s Mailers Technical Advisory Committee meeting.

The following article has been produced exclusively for Mailers Hub by Martin Eisenstein and Jamie Szal of Brann & Isaacson.

For the last seven months of 2021, the Postal Service’s public relations office has issued weekly releases touting service performance improvements.  However, a closer look at those releases suggests that, while the authors’ purpose seems to be to create a perception of improvement, that scenario isn’t supported by their own data, and shows a trend that actually isn’t as impressive as they want readers to believe.

Contexts

The Postal Service’s recent claims of readiness for the demands of the 2021 holiday shipping season may be more good PR than accurate, based on what the Postal Service’s Office of Inspector General recently reported.  In that audit report, Fiscal Year 2022 Peak Mailing Season Preparedness, issued November 19, the OIG documented both the measures the Postal Service has taken and where those may be falling short.

Getting ready

The Private Express Statutes can be traced back to 1792 when Congress, empowered under the Constitution to “establish post offices and post roads,” granted the federal government sole authority over the carriage and delivery of letter mail.  That authority, now codified in 18 USC 1693-1696 and 39 USC 601-606, originally enabled the Postal Service to suspend the statutes if that would be in the public interest.

The USPS implemented an exception in 1979, for example, to allow private companies, notably Federal Express and United Parcel Service, to carry “extremely urgent” letters outside the mail subject to conditions including payment of postage.  (The PES apply only to “letters,” so the private carriage of other matter – like newspapers and packages – is open to non-USPS providers.)  That authority ended in 2006.

In any public statement about its products or services, it’s to be expected that a private company will present information that frames those products and services as favorably as possible. Any commercial or advertisement is an example.

Whether the Postal Service should engage in such a practice is another matter. Though it’s supposed to operate in a “businesslike manner,” it’s fundamentally a government agency whose vaunted trustworthiness would make the transparency of operations and complete honesty of information no less than core values.

One segment of the November 3 Mailers Technical Advisory Committee meeting’s focus group session on Customer Experience, Product Solutions, and Innovative Business Technology featured Sharon Owens, USPS VP for Pricing and Costing.

In her presentation, Owens sought to explain trends in the Consumer Price Index, on which the price cap on market-dominant rates is based, and the factors that determine the additional pricing authorities derived from the Postal Regulatory Commission’s November 2020 decision.

After all the controversy, arguing, and heated exchanges, we’ve reached the point in postal matters that really counts. We’ve been told how the Postmaster General’s 10-Year Plan will make everything right, and how, as part of that Plan, the Postal Service is going to have an outstanding 2021 peak season. But now, less than seven weeks before Christmas, the hanging question remains how much of that will come to pass; will the 2021 peak season live up to the hype?

Last year, in the heat of allegations that Postal Service operational changes being implemented by then-new Postmaster General Louis DeJoy were politically motivated efforts to delay election-related mail, a group of attorneys general from several jurisdictions brought suit in federal court and successfully delayed some of DeJoy’s plans.

That group is no happier with what DeJoy is doing – or proposing – in his 10-year Plan announced last March.  On October 7, a complaint was filed with the Postal Regulatory Commission by the attorneys general from California, Connecticut, Delaware, District of Columbia, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Virginia, and Washington.

The unrelenting impact of the pandemic caused the National Postal Forum to be virtual again in 2021 – actually as two online events, one last spring and a second last month that coincided with National PCC Week.

However, the September session’s presentations offered less than the usual wide variety of topics and instead were dominated by a Postal Service multi-part infomercial touting Postmaster General Louis DeJoy’s 10-year Plan.  From the opening session to individual panel discussions, viewers were repeatedly presented with scripted “conversations” in which the PMG was fed softball questions, all designed to elicit planned answers that framed the Plan and its contents in the most favorable terms.

Though it’s generally understood that manual operations are less efficient than those that are mechanized or automated, a September 21 report by the USPS Office of Inspector General further highlighted the chronic inefficiency in Postal Service manual distribution operations.

Overview

As everyone involved in commercial mail production realizes, we’re heading into a second atypical fall mailing season.  Supplies of the essential raw material – paper – are tight, trucking companies are busy moving backlogged shipments from ports, drivers are still in short supply, and companies are struggling to find workers despite high unemployment.

Concurrently, the Postal Service is reworking its processing and logistics networks – consolidating some operations while adding annexes and installing package sorting equipment – and planning to move more mail by truck and reduce its service commitments.

The 2020 peak mailing season likely didn’t go as the Postal Service or its customers had expected, to say the least.

Whatever preparations the agency had made for the usual seasonal volume were severely disrupted as the global pandemic impacted employee and transportation availability, and as package volume surged in response to orders from quarantined shoppers.  USPS processing facilities strained to move volume and maintain service but, as the Postal Service and commercial mailers learned, those efforts were unsuccessful in some locations, necessitating exceptional measures to redirect or completely halt the inflow of mail.

The Postal Service’s 10-year Plan, released March 23, optimistically assumes package volume will grow and provide a critical source of revenue to offset the Plan’s projected $160 billion loss over the period.

However, as we first reported last April, the continuing trend of competitive product contracts seems to not support the agency’s rosy expectations.  According to data available from the Postal Regulatory Commission website, from January 1, 2020, through August 13, 2021, 48% more competitive product (CP) contracts with the USPS were terminated (426) than were approved (287).

Given the circumstances of their nomination and confirmation, it’s no surprise that the majority of the sitting USPS Governors exhibit a common philosophy, regardless of their partisan affiliation.  Moreover, the six governors who were in place before this summer, having chosen the current Postmaster General, also display a singular allegiance to him, and back any decisions that he makes; he’s their man.  As a result, Louis DeJoy apparently can run the USPS as he wants, knowing he’ll be supported fully by those who selected him.

Insulation