Donald J. Trump is many things. Dull is not one of them. Since returning to the White House, he has spent considerable time and effort reshaping the executive branch through the creative use of the president’s power to issue executive orders.
Trump has closed—or is close to shuttering—executive branch agencies, is attempting to pare down the federal workforce, and is bringing federal agencies considered to be independent of the executive branch under presidential control. It’s an interesting experiment in governance that shows he’s not afraid to throw the baby out with the bathwater.
Whether these efforts survive the predictable court challenges is unclear. Trump’s reliance on the Constitution’s Article II investiture of all executive power in the president may be too encompassing for the courts to swallow. Some people believe, however, that these constitutionally interesting challenges are long overdue.
One that probably won’t stand up to strict scrutiny is his rumored decision to end the status of the United States Postal Service as a quasi-governmental private corporation by abolishing its presidentially appointed, congressionally confirmed board of governors and making it a part of the U.S. Department of Commerce. An act of Congress established the current structure, so it will probably take an act of Congress to make a chance of that order of magnitude.
There are ways to make the Postal Service more profitable, if not profitable, and, over time, reduce the debt to an operationally manageable level. Unfortunately, outgoing Postmaster General Louis DeJoy, whom Trump appointed during his first term, has been resisting most of them. Instead, through his now much-maligned Delivering for America Plan, he’s been adding full-time permanent unionized staff and building monstrous facilities while bringing in-house much of the work its private sector partners were doing well.
That is precisely the wrong thing to do. The way to reduce the volume of red ink the USPS produces every year is to streamline the workforce—a government-wide mission for Trump, it seems—while having it focus on what it alone can do.
The problem, as always, is what is known as the last mile. Until Congress removes from the law the provision that requires the postal service to provide daily home delivery to just about every household in America, complete privatization will be of the table because it costs too much.
It’s interesting to see how the red/blue divide plays out in this issue. Local delivery once or twice daily inside highly populated blue cities and purple suburbs will remain relatively inexpensive. The cost for that same level of service will soar, for reasons that should be obvious, for sparsely populated red states and Republican-leaning rural areas. Were Trump to allow that to happen, even by default, he would be punishing the people who voted for him while rewarding his political opponents. That doesn’t sound like the kind of thing he’s inclined to do.
So, what should be done, aside from casting off what remains of DeJoy’s failing plan? Whatever it is, it must be constructed to satisfy the USPS’s current universal service obligation to deliver first-class mail, magazines, and packages to everyone virtually everywhere, six days per week, in the rain, the snow, and the gloom of night.
The next Postmaster General, whoever it might be, needs to focus on outsourcing everything else the USPS does. This is where the private model has been proven to work. The presorting, transportation of mail and packages, equipment maintenance, IT payment solutions, and cash management are all better done by the private sector than by a unionized government workforce. In private hands, these functions are handled at less expense and with greater efficiency --- so let’s give those actors in the postal space more to do.
That leaves the USPS able to focus on the last mile. That’s its core competency, which, as all the business schools teach today, is what executives who want to be successful should focus on. Outsourcing (instead of outright privatization) will allow the USPS to produce cost savings of up to what some estimates say could be as much as $12 billion through a hiring freeze. Another $15 billion could be banked rather than invested, a word chosen ironically, into the completion of DeJoy's network of upstream mega-processing centers that are already proving to be unable to meet what was expected of them.
Nothing less than the United States Postal Regulatory Commission – the entity that determines how much it costs to mail a letter – reports the Postal Service’s performance to be in continual decline, year over year. That’s not something that can be fixed by making it a part of the Commerce Department or any other government agency. If there’s going to be changes, and there should be, they shouldn’t bring the Postal Service back inside the government. No, they should be centered on outsourcing all the things the private sector does better and cheaper so the USPS can earn its way out of the hole it's dug for itself rather than having the taxpayers bail it out.
