The United States Postal Service is in dire fiscal straits. America’s mail carrier recently announced that it lost $9.5 billion in fiscal year (FY) 2024, up from $6.5 billion in FY 2023. Things clearly aren’t looking good for any organization that needs “aggressive actions” to keep 10-year losses limited to “only” $70 billion instead of $160 billion. The turnover in presidential administrations offers some hope for change, but decades of failed policymaking should humble even the most partisan observers. Absent Congress stepping in and demanding reform, business as usual will continue at a substantial cost. Lawmakers must push postal leadership away from these failed policies and pursue real reform.
For almost four years, outgoing President Joe Biden has made it his mission to oust Postmaster General (PMG) Louis DeJoy as the USPS’ chief executive. PMG DeJoy certainly hasn’t had many fans on the left because of his efforts to remove mail collection boxes and consolidate facilities. These efforts first started a few months before the 2020 presidential election, and fueled conspiracies that DeJoy was trying to rig the election for Trump.
President Biden may not be fond of DeJoy, but that doesn’t mean he could replace him overnight – or even over a term. It’s up to the nine presidentially-appointed governors on the U.S. Postal Service Board of Governors to hire or fire the PMG. These governors need a majority to can DeJoy, which is why Biden has nominated DeJoy-critics such as former U.S. Rep. Val Demings (D-Fla.) to the board.
Even if DeJoy is ousted before the second Trump presidency, the implications for reform are unclear. The PMG applauded Congress’ passage of the 2022 Postal Service Reform Act, which wiped the slate clean on more than $100 billion worth of agency debt. In addition to this massive bailout, the agency received $10 billion from taxpayers in COVID relief and $3 billion to purchase bank-breaking electric vehicles (EVs). DeJoy is now reportedly asking for even more taxpayer money to tide over the beleaguered agency. While the initial ask is $14 billion, “the Postal Service estimates that it is entitled to almost $100 billion more” because of “decades of overpayments into the Civil Service Retirement System.” As usual, the agency fails to show its receipts and asks taxpayers to foot a gargantuan bill. And because PMG DeJoy is committed to a heavily unionized staff that is mostly comprised of career employees, costs will continue to climb.
Democratic appointees to the Board of Governors such as Dan Tangherlini, Ron Stroman, and Val Demings (if confirmed) could lead the charge for a more liberal alternative to DeJoy, but it’s unclear that things could get much worse. Despite being appointed by a Republican, DeJoy has already opened the door to mass EV adoption, taxpayer subsidies, unionization, and perpetual stamp price hikes. The more likely scenario is that PMG DeJoy holds onto power and Trump ensures a majority-Republican slate of governors for the foreseeable future. Either way, there’s just not much incentive for the board or the Oval Office to shake things up.
Change can happen, but it’ll be up to Congress to lead the charge. For starters, lawmakers could condition postal worker eligibility in the Federal Employee Retirement System on the agency hiring less-costly temporary workers in place of career employees. According to an August 2024 Inspector General analysis of the USPS’ workforce composition, existing postal union agreements allow the USPS to hire far more non-career employees than they are now.
Labor costs comprise about 80% of agency operating expenses, and it’s critical that the USPS balance its mix of employees. Congress could also update the Postal Accountability and Enhancement Act of 2006 to stop the USPS from offering financial services such as banking at a loss. These reforms would be a welcome break from decades of postal mismanagement and buck passing. Even if the president or Postmaster General can’t fix the USPS, perhaps lawmakers can.