Last October the United States Postal Service announced its desire to raise the price of a first-class stamp from 20 to 23 cents. Aside from the scattered grumblings of a few editorial writers and cartoonists (one of whom depicted the new 23-cent stamp as bearing a likeness of Al Capone), the news was greeted with the same shrug of unsurprised indifference that attends George Steinbrenner’s periodic decision to fire the manager of the New York Yankees. The press downplayed the story so much that many people missed it entirely. Even the strong whiff of fiscal irresponsibility did not seem to rouse the public from its apparent torpor. The same day it announced the 23-cent first-class stamp, the USPS signed a $47,000-a-month lease on a Citation II jet for use by its top executives. Assistant Postmaster General Mary Layton explained that the jet was “not so much to save money, but to save executive time.” The Washington Post responded by burying the story on page A10.
That public expectations have sunk this low is really not all that surprising, given the Postal Service’s sorry record of recent years. The most obvious indignity is the price of a first-class stamp. Since 1971 it has risen from 6 to 20 cents, much faster than the rate of inflation. Compare that to the 86-year stretch between 1885 and 1971, when the stamp increased from 3 to 6 cents. The cost of living during the same period nearly quintupled.
The various ways in which postal services have declined in recent years are almost too numerous to list. If you live in a housing development built after 1978, you already know the Postal Service considers you a second-class citizen; you’re legally ineligible for “to the door” delivery and are supposed to collect your mail at the curbside or from special “cluster boxes.” Saturday window service has been discontinued in many parts of the country, making it even more inconvenient for those who work to use the post office. If you’ve noticed that those once ubiquitous blue postal boxes are harder to find, it’s because the USPS long ago reduced their number in an “economy move.” Were your camellias trampled last spring by an unapologetic mailman? It could be the result of a USPS directive issued in 1977 that instructed mail carriers to cut across lawns to save time.
Then, of course, there’s the mail itself. Your sense of its getting delivered at a somewhat more leisurely pace happens to be borne out by the Postal Service’s own figures. In 1969 it took an average of 1.5 days to deliver a first-class letter. Today, after several billions of dollars have been spent on automated letter-sorting devices, it takes an average of 1.68 days. In 1974 the General Accounting Office discovered that about 7 percent of first-class mail is sent to a wrong destination somewhere along its route; later, a USPS official testified that the figure was probably higher. And if you’re a businessman, you won’t be surprised to learn that a 1981 study by the Direct Mail Marketing Association found that up to 8 percent of third-class bulk mail never gets delivered.
Those disgruntled with first-class mail service may be initially relieved to learn that the failure rate for Express Mail seldom exceeds 5 percent. But Express Mail, which supposedly guarantees overnight delivery, happens to cost a minimum of $9.35. What if the letter or package that absolutely, positively had to be there the next day, doesn’t make it? In the worst of businesslike traditions, the USPS will reimburse you only if you notify them of the delay—and specifically apply for a refund.
Rising stamp prices and slower, less reliable delivery is bad enough. But perhaps the average citizen’s biggest frustration involves something more intangible. The Federal Express commercial that depicts a line of customers growing old while two postal clerks studiously ignore them is memorable, not just because it’s an amusing caricature, but because it’s all too true. You’ve probably stood in line yourself for nearly half an hour on more than one occasion, watching with mounting impatience as the postal clerk fumbled for his inkpad and thumbed slowly through his zip code directory. Perhaps you recently lost an insured package and were forced to fill out various forms and endure a long wait—typically 60 days or more—to get reimbursed. Or maybe it was just the air of rude indifference the postal clerk displayed the last time you made a simple inquiry, like asking for half-a-dozen commemorative stamps. None other than William F. Bolger, the postmaster general, admits that one-third of the complaints he receives are about surly window clerks. “We emphasize courtesy in training,” he told an interviewer in 1981. “When we get a certain number of complaints, clerks are sent back for retraining on their own time. But it’s like a vaccination that didn’t take.”
Two cheers for socialism
Those who recall the U.S. Post Office of a generation ago know it enjoyed a distinctly different reputation. A letter mailed in Washington, D.C., stood a good chance of arriving in New York City the next day. Mail was delivered twice a day, three times a day for businesses. Letters bound for distant cities were sorted while en route in specially designed railroad cars; this degree of diligence seems almost quaint today. Those arguing on behalf of the virtues of socialism could always resort, if the going got rough, to one sure-fire argument: the post office was a government-owned enterprise that was efficient, inexpensive, and publicly accountable.
Mike Causey, a reporter for The Washington Post and an astute observer of the federal bureaucracy, put it best in a 1983 study of the USPS that was done by Ralph Nader’s Center for Responsive Law. Causey told the author of the study, Kathleen Conkey, “In the old days you could call your congressman and very likely get action if you had a postal problem. Now they have a consumer advocate and you have to write him a letter just like a big corporation.”
That’s what the Postal Service now prides itself on being: a large, modern corporation. So when the Postal Service posted a profit of $802 million in 1982, its managers gleefully trumpeted the fact as proof that the 1970 decision by Congress to reconstitute the USPS as an “independent government corporation” had finally been vindicated. So enthusiastic was the praise for the USPS’s balance sheet from other quarters that it easily drowned out those few critics who had the bad manners to point out that the USPS was also supposed to be a nonprofit corporation.
Politicians congratulated the Postal Service for its adherence to corporate standards of efficiency. The four major unions representing the system’s 670,000 postal workers quickly took credit for their own role in racking up the surplus; they also put the USPS on notice that they would demand a healthy share of those profits when their contracts expired later this year. The press was also favorably impressed; Forbes magazine, in an August 1, 1983, article, opined that “the entire economy will benefit from USPS profitability.” The Forbes article also speculated wistfully about how much better life would be if “Congress could only get the rest of the federal government on this kind of businesslike basis.”
Given the popular assessment of USPS service, one is tempted to wonder whether Forbes‘s plucky patriarch, Malcolm Sr., has taken one too many balloon rides into those upper realms where the oxygen gets dangerously thin. The USPS, after all, is hardly a typical business—it pays no taxes, holds a monopoly on its main source of revenue, and has, in effect, virtual carte blanche to increase its stamp prices. The USPS has also racked up a cumulative loss of more than $3 billion since 1970, even counting last year’s surplus, a record that would certainly disqualify most private corporations from such accolades.
Still, the praise from the unions and Forbes illustrates a key point about today’s United States Postal Service. Though it may no longer aim to please the average citizen, the USPS does its best to please some of its other constituents. Those constituents happen to be a great deal more powerful than your Aunt Martha, whose Christmas card you mailed with a week to spare didn’t arrive until the eve of Superbowl XVIII. And two of the most powerful constituents happen to be postal workers and large magazines like Forbes.
‘Hooked on the money’
A look at the Postal Service’s solicitude to certain, preferred constituents should start with the postal worker. The average postal worker makes $27,571 a year in salary and benefits, the latter of which typically includes five weeks of vacation. Most of the 670,000 jobs are indoors—even most of those who must venture into the rain, snow, sleet, and gloom of night now have vehicles with working heaters. The job requires no advanced training; applicants are evaluated according to how well they score on a civil service examination.
Some 980,000 people know a good deal when they see one—that’s how many applied in 1982 for 27,000 positions. When 100 postal jobs opened last summer in Newark, New Jersey, the rush of applicants actually tore the post office’s door off its hinges. Referring to the nation’s smaller communities, Bolger himself observes, “In many cases today the postal worker is the best-paid guy in town.”
The postal worker who joins for the money usually ends up staying for the same reason— plus the job security. The current contract with postal unions prohibits, except under the most extreme of circumstances, the lay-off of employees who have been with the USPS for six years or longer. Unless a worker is caught punching his supervisor in the snout or drinking Jack Daniels in the lobby, a tangled web of grievance and appeal procedures offers the postal worker nearly total protection from being fired. Last year only 2,600 workers—about one-third of 1 percent—were fired; about the same number quit. These figures are even more dramatic when you realize that alcoholism is a widely acknowledged problem, and that USPS employees have a deserved reputation for being somewhat less than diligent. A recent GAO study of three major facilities found that postal workers average ten unauthorized absences a year.
Postal workers owe their comfortable circumstances in large part to the 1970 reorganization act, which gave their unions the right to bargain collectively for wages, a privilege other federal unions do not enjoy. While their brethren in the civil service saw their wages climb 70 percent during the 1970s, postal workers, holding out the threat of an illegal strike, won increases of 123 percent. During the last round of negotiations in 1981, many observers believed the unions would follow through on their strike threat—until the air traffic controllers beat them to the punch and were irrevocably fired by President Reagan.
The 1970 act mandates that compensation for postal workers must be “comparable to the rates and types of compensation paid in the private sector.” But “comparability” is in the eye of the beholder. A recent study by two University of Pennsylvania professors found that the only comparable workers in the private sector whose compensation was similar to that of postal workers were those unionized workers who belonged to the United Steel Workers, the United Autoworkers, and the Teamsters. But in one important respect postal workers have a decided advantage over these workers, whose ranks were severely depleted by the recent recession. John Crutcher, an outspoken member of the Postal Rate Commission—a notoriously toothless regulatory body that reviews but has no veto power over postal rates—remarks, “If you were to ask any of the 250,000 unemployed autoworkers to suggest a monetary value for the postal workers’ [no-layoff] clause, you might get some surprising answers.”
The postal unions’ best defense for their members’ more-than-comfortable circumstances is that much of their work is so unpleasant. It’s certainly true that automation has taken once routine jobs like letter sorting to new heights of tedium. Think about punching five-digit zip codes into a keyboard as letters whiz by at the rate of one per second, and you get the picture. What the unions prefer to downplay—but postal workers themselves readily acknowledge—is that not everyone is a letter sorter. In fact, many postal jobs are highly coveted for their pleasant working conditions and flexible hours.
Take the letter carrier. The advantages of the job include regular human contact and freedom from being under the boss’s watchful eye—not to mention those generous souls who still tip their postman at Christmas. And because mail routes are often designed with the not-so-fleet-footed in mind, the carrier who moves with dispatch can often complete a day’s work in five or six hours. This helps explain why the competition for carrier jobs is keen, even though the base pay is $800 a year less than a letter sorter’s.
Stanley Sloan, a letter carrier in the Washington, D.C., area, took a job with the Postal Service after losing one as a computer repairman. Sloan worked a few years on the “inside” as a clerk and hated it. Now he’s walking a route and says he’s relatively happy, though he’d prefer to be a driver so he could stay warm in the winter and have even less contact with supervisors. Sloan, like many carriers, has enough free time to hold a second job. He and his brother have started a private garbage-hauling business; if it proves highly successful, Sloan says, he might quit the Postal Service. But that’s unlikely. “I don’t think you can make the work more interesting,” he says. “But you [can] get hooked on the money.”
The phenomenon Sloan describes seems to be the Postal Service’s main occupational hazard. In fact, not one of the dozen postal workers I interviewed complained about being paid too little; several even said they felt overpaid. Boring as some of the work may be, the captivity is usually too plush to prompt any serious attempt at escape. Jimmy Bryant, a retired supervisor from Orlando, Florida, describes the situation: “If you can get through the first year, you’re there for your entire career.”
While nothing can turn punching zip code buttons into stimulating, inspiring work, there are ways the Postal Service could increase the job satisfaction of its employees. It could rotate workers more often among a variety of jobs, or divide them into teams and give incentive bonuses to those who perform well. It could also require that promotion decisions take merit into account. Aside from having to pass a minimal competency test, all promotions within the Postal Service are now based solely on seniority. Job performance is irrelevant.
So what do the unions who represent postal workers think of such reforms? They’re against every one of them. Their response to their members’ legitimate complaints about tedious and sometimes unsafe working conditions has traditionally involved little more than urging that the velvet handcuffs become even more comfortable. They’ve simply demanded even more money.
Why has management acquiesced to high wages, no performance review, and such stiff restrictions on its ability to dismiss workers? However much USPS officials may gripe about the unions, they’ve learned that placating workers with more money is the easiest way to buy labor peace. It’s the path of least resistance, largely because most of the customers who must pay for that peace through hefty wage hikes have nowhere else to turn. A recent study by Dr. Douglas Adie of Ohio University observed that the Postal Service “has no real incentives to efficiency. Managers make decisions in a way to reduce their psychic rather than dollar costs, and one important psychic cost is the friction of employee relations in dealing with postal unions. . . . It is therefore ‘cheaper’ for management to be generous with wages than to stand firmly for efficiency.”
Indeed, postmasters and supervisors are often more than silent partners in this conspiracy; they have their own interest in perpetuating costly inefficiencies. For example, the main post office in Washington, D.C., has one supervisor for every ten workers. Although the USPS has lost 70,000 employees since 1970—the unions have willingly sacrificed jobs on behalf of higher wages for those remaining—it has managed to add more than 1,500 supervisors. These supervisors frequently have one thing in common with union members: an indifference to saving the customer money and an obsessive attention to job comforts and status.
James Hatcher once had a job on the loading docks of New York City’s General Post Office that required him to weigh incoming mail. It was a relatively simple task, especially since all he did was watch his boss fabricate the figures. Hatcher says his supervisor explained that he had a supervisor who wanted his supervisors to think incoming volume was high. Why? More employees would be assigned to the loading dock, thereby giving the supervisor of the loading dock more status.
Another employee, a young mail carrier in a Chicago suburb, told me he once complained to his boss that he was finishing his work in much fewer than eight hours. When he asked for a longer route, he was told he would have to wait until the routes were redesigned, which happens just once a year. He then offered to help with other jobs around the post office. He was told that work rules prohibited this. He got the message; today, he keeps himself occupied for eight hours by taking long lunches, working at a leisurely pace, and going home early whenever possible.
A final example of the mutual indifference to efficiency involves part-time workers. As anyone who sends Christmas cards and packages knows, the local post office is busier during certain times of the year. To handle periodic increases of volume, it obviously would make sense to rely on temporary workers, a much cheaper solution than creating slots for regular employees. But the contract between the USPS and its unions heavily discourages part-time workers: in a postal facility employing 200 workers, at least 90 percent of the employees must be full-time. The Postal Service’s inability to hire many part-time workers is one reason that it was socked with an overtime bill in 1982 of almost $1 billion.
What’s surprising is that USPS managers seem as happy with this arrangement as the unions. In an interview, Bolger cited the elimination of part-time workers as one of the major achievements of the post-1970 postal system. “Just for Christmas operations, we used to have over 400,000 temporary people brought into the Postal Service,” he recalls. What did Bolger, who began his career with the post office in 1941 as a civil servant, dislike about this practice? The part-time workers, he says, were “political patronage” jobs, not civil service positions.
The productivity con
Neither the unions nor management see it as in their respective interest to press hard for cheaper, and better, postal service. Besides, it’s easy to get away with inefficiency because no one is looking. Scan the last three years of the Reader’s Guide to Periodical Literature and you’ll find a conspicuous dearth of articles detailing what postal workers really do all. day for their money. Nor will you find much insight into whether postal rates are set fairly, and whether those “costs” that the Postal Service cites when it asks for rate hikes really are unavoidable.
Why so little coverage? Two reasons, the first being that the press is so easily snowed by the USPS’s statistics. A good example of that involves something called “gross productivity,” which USPS officials claim has increased 43 percent since 1970. Bolger usually uses this statistic to bolster his case for a rate hike, implying that the USPS is doing such a thorough job of cutting costs that it has no choice but to raise stamp prices—reluctantly, of course.
The gross productivity figure merits a closer look. The Postal Service calculates it by simply dividing the total pieces of mail handled by the total work hours. This sounds reasonable until you realize that the mix of mail has changed dramatically since 1970. Today, there are proportionately fewer packages (which are hard to handle), because most of the nation’s parcels are now delivered by the United Parcel Service. Customers have found UPS is cheaper, largely because employees are paid about two-thirds of the Postal Service’s pay scale. Perhaps most important, the productivity figure doesn’t account for the vast increase in pre-sorting of the mail that the USPS still carries. Pre-sorting, which saves the Postal Service a substantial amount of time, allows business customers to mail at substantially lower rates. Using a different definition of productivity, which tried to account for these differences, the Bureau of Labor Statistics recently concluded that in some years when postal management was saying productivity had increased, it had actually dropped.
Likewise, few reporters have taken a close look at the Postal Service’s claim that 95 percent of its mail meets delivery goals. According to these goals, “local mail” must be delivered overnight, letters inside a 600-mile radius within two days, and all other mail within three days.
Who defines “local mail”? The same local postmasters whose performance is being judged by the delivery tests that the USPS periodically conducts. If a postmaster has difficulty servicing a close-in area because of, say, slow employees and incompetent supervisors, he has an easy recourse: he simply defines “local mail” to exclude the troublesome post office. The GAO has also discovered that USPS managers often notify postmasters as to when they’ll be tested. Finally, the 95 percent standard applies only to getting a letter from the originating post office to the post office closest to the destination—not to the addressee’s mailbox.
So the Postal Service has rigged its own game. That’s why it’s even more disconcerting to realize that it still can’t meet its delivery goals. In 1981, Bolger boasted that “local mail” met the overnight delivery goal of 95 percent. But only 86 percent of the two-day mail passed muster, as did only 87 percent of the three-day mail. For these two categories, this was a substantial drop from 1976, when the figures were 92 and 90 percent, respectively.
But let’s not give too much credit to media naivete as an explanation for the failure to report the inner workings of the Postal Service. There’s another reason: the relationship between the USPS and those private enterprises that make money reporting the news. In many cases the relationship is just one big backscratch, coming in the form of multimillion-dollar mailing subsidies to newspapers and magazines.
Perhaps the best deal given the media—”red-tag service”—is available to some of the nation’s most profitable publications. The Wall Street Journal‘s 1.3 million papers, which weigh a half pound each, are delivered overnight by the Postal Service for 14 cents apiece. In its home territory of Manhattan, the Journal pays just 5 cents. The regular second-class rate for a similar package is 95 cents, and delivery can take up to 10 days. But with red-tag service, postal workers drop what they’re doing when the Journal arrives to ensure it reaches subscribers by the next day.
The Wall Street Journal is not the only beneficiary of this service. Time, Newsweek, Business Week, and other “time-sensitive” publications also reap its benefits in exchange for meeting some relatively simple pre-sorting and delivery guidelines. “Time sensitive,” according to USPS regulations, means the publication must be published at least once a week. So why do Forbes, and its main competitor, Fortune, get the same treatment even though they come out once every two weeks? When The Washington Monthly inquired several years ago, a postal official replied that the two magazines “aren’t biweeklies. They’re fortnightlies.”
To help dissuade USPS bureaucrats from consulting a dictionary and revoking this exceptional treatment, Forbes‘s executives have been wise to apparently cultivate a special relationship with their benefactors. Effusive praise for “businesslike behavior” is only part of the effort. Last April Malcolm Forbes Sr. took William Bolger up for a spin in one of Forbes’s fabled balloons, a huge replica of the Chateau de Balleroy in France. The occasion was the issuance of a new commemorative stamp celebrating—what else?—the history of ballooning. After returning Bolger safely to earth, Forbes hosted a fancy brunch for 350 guests, including USPS executives and their wives.
It’s not hard to understand why Forbes and other publications are so grateful for red-tag service. The average citizen who wants guaranteed, overnight delivery from the USPS has only one choice: to shell out at least $9.35 for Express Mail. Forbes and its “time-sensitive” brethren can get the identical service for a little more than one-hundredth of that. Indeed, nothing better illustrates how the USPS treats the typical “first-class” postal patron like a third-class citizen—and gives the royal treatment to large mailers under the guise of “second-class” mail rates.
In 1981 the Postal Rate Commission, the regulatory body established by the 1970 reorganization act to supposedly protect the public’s interest in rate-setting cases, concluded that other postal patrons were being forced to subsidize red-tag service. The PRC accordingly recommended that the USPS’s request for a raise in first-class stamp prices from 15 to 20 cents be scaled back to 18 cents. The PRC also recommended higher increases in other classes of mail, and specifically urged that red-tag service be priced at 3.4 cents more than regular second-class mail.
The reaction was swift and furious. Newsweek immediately threatened to develop alternative delivery systems. Chapin Carpenter, executive vice president of the Magazine Publishers Association, said his organization was “angered and appalled.” Carpenter threatened to fight any such increase in court.
As the PRC pointed out, red-tag recipients, at the very least, should be paying their way. Besides, the threat of taking business elsewhere should be seen for the bluff that it largely is. Comparably cheap alternatives may exist in some concentrated, urban areas. But who else besides the Postal Service delivers, overnight, to every destination in the country, much less at such a low price?
But the USPS quickly let it be known which class of postal patron it was looking out for. In November 1981 it overruled the PRC’s recommendations, and issued the 20-cent stamp while keeping red-tag service free of charge. Lee Fritschler, the chairman of the PRC, was furious, predicting that the 20-cent stamp would give the USPS an unwarranted windfall of $1 billion in 1982.
In 1982 the USPS actually posted a $1.2 billion surplus—and then risked a reprimand from its own accountants, Ernst & Whinney, by increasing the reserves of its workers’ compensation fund to reduce the figure to a slightly less embarrassing $802 million. (Remember, the Postal Service is ostensibly a nonprofit organization.) So did Forbes, The Wall Street Journal, and Newsweek say a word about how the USPS had proved itself guilty of premeditated price gouging? Hardly. Forbes seemed to speak for all of them by characterizing the surplus as eloquent testimony to the Postal Service’s new-found business sense.
The wrong kind of politics
Of course, the vast majority of the 110 billion pieces of mail that the Postal Service handled last year did arrive at their proper destination within a reasonable amount of time. It’s also true that many of us have probably had occasion to use that most credible of excuses—”It must have gotten lost in the mail”—to cover up for some act of thoughtlessness or debt-evasion. And some people have even accepted the judgment of those organs of respectable opinion that say we really can’t expect anything better. This latter attitude was perhaps best summed up by a recent study of the USPS by the National Academy of Public Administration. The study had little save praise for the Postal Service’s operations, though it off-handedly observed that “The USPS, in its successful efforts to reduce costs and increase productivity, seems to have pursued these objectives at some sacrifice in employee courtesy and customer services.”
But what the NAPA study fails to recognize is that the Postal Service hasn’t forsaken service to all customers—just some of them. Those who deplore the passing of the village post office as a community center, or the deterioration of predictable, swift mail service, realize how the focus on the bottom line has been particularly painful. But the pain would be more tolerable if everyone were treated alike. As red-tag service graphically illustrates, some postal patrons are getting a great deal more “service” than the rest of us.
And that raises some important questions. If the USPS enjoys such discretion in parceling out “service,” why should the lucky recipients be selected by a small group of executives who are unaccountable to the public? Shouldn’t those decisions be made by the public’s representatives, subject to public debate? How else can the average man expect the Postal Service to treat him as an equal?
The question is not whether the primary emphasis of the USPS should be on service, but how the decisions on bestowing that service are made. After all, despite the USPS’s corporate aspirations, and even though in 1983 it operated free of a congressional operating subsidy for the first time since its inception, the organization that delivers our mail isn’t named “The Postal Company, Inc.” It’s called the United States Postal Service. The name recognizes that, historically, the post office’s primary goal has not been the ferocious pursuit of black ink on its annual ledger sheet. Were it to slavishly adhere to the dictates of “business efficiency,” the USPS might logically decide to start charging only 10 cents for letters mailed from New York City to Los Angeles, based on the “economies of scale” involved in moving large quantities of mail—and $1 for letters sent from Caribou, Maine, to Antelope, Oregon. But the public has traditionally put other values first, such as the desire to provide all Americans, regardless of how remote their location, with accessible, equally priced postal service. That desire reflects not “businesslike” behavior, but a long-standing commitment to the basic principle of egalitarianism. Similarly, the fast-vanishing tradition of postal workers’ putting service to the individual customer first recognized that the Postal Service is still the most visible example of government in people’s everyday lives. When people lose faith in the post office, it colors their attitude about everything else government does.
The 1970 reorganization act was touted as a way to restore the public’s faith in its postal service by removing the last vestiges of “politics” from the system. No longer would Congress be able to meddle in the post office’s affairs; no longer could jobs be given out as political rewards. But the act has clearly backfired. Politics still play their part, but now the system responds, not to the complaints of those who once wrote letters to their congressmen, but to those powerful groups that benefit most from the system’s generosity. Unions have discovered how to use the threat of strikes and the collective bargaining process to win exorbitant wages and work rules that undermine efficiency and courteous service. The system’s managers have learned that they can operate with little public scrutiny, raising prices and cutting back on service with scarcely more than feeble protests. And large mailers have learned to protect their interests by hiring $150-an-hour lawyers to lobby the USPS so that it continues to force first-class letters to subsidize special deals like red-tag service.
And what about the average citizen? Most of us don’t even bother to complain anymore when a letter gets lost, or when we’re made to feel humiliated by a rude window clerk. It’s not that we don’t want to complain. It’s just that now we feel it really won’t make any difference.