Exchange between Sen Rand Paul and U.S. Postmaster General DeJoy on labor and cost decisions for USPS
Sen. Paul: “Can you think of a private business where 80% of what they are doing to make money is going down in volume, that would actually increase their employees?”
On 12/5/2024, U.S. Senator Rand Paul (R-KY), Ranking Member of the Senate Homeland Security and Governmental Affairs Committee, demanded answers regarding the ongoing financial issues at the United States Postal Service (USPS). During a hearing titled “Oversight of the United States Postal Service: Understanding Proposed Service Changes,” Dr. Paul called on the Postal Service to implement significant structural labor reforms. Dr. Paul highlighted that despite receiving more than $120 billion since 2020, the Postal Service continues to undergo significant financial losses due to an inefficient labor structure. This year, the Postal Service reported a net loss of $9.5 billion, nearly a 50% increase from last year’s loss of $6.5 billion. However, even with the ongoing financial shortfalls, the Postal Service has converted 190,000 employees to permanent, unionized positions with significant pension and healthcare obligations, contributing to its growing debt. Dr. Paul pointed out that private businesses facing uncontrolled costs and a declining business model would not increase their expensive workforce. Instead, private businesses would handle lingering labor costs by adjusting and making cuts where necessary. Postmaster General DeJoy tried to downplay these issues, but Dr. Paul emphasized the Postal Service’s ongoing financial troubles are irresponsible considering the over $36 trillion debt impacting the American taxpayer. Dr. Paul urged Congress to stop wasting funds on USPS until it balances its budget through alternative labor solutions or outsourcing its workforce.
The Postal Service has tried to explain away these bad numbers due to “costs that the USPS cannot control.” But the Service is spending $9.6 billion in electric delivery vehicles and spending nearly $40 billion over 10 years to convert and build certain facilities into hubs that so far have resulted in worse delivery times and service. In order to keep making these infrastructure updates the Postal Service has asked to raise its $15 billion borrowing limit with the Treasury Department. Private sector companies deal with uncontrolled costs all the time, including the same factors USPS faces like inflation, and they find a way to provide for their owners and shareholders. USPS should account for the “uncontrollable costs” in their budgeting and stop coming to Congress to bail them out.
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Sen Paul to Postmaster General: 80% volume down but increase employees with benefits? uncontrollable costs