ATR: Coburn Postal Bill Misses The Mark
Coburn-Carper Postal Bill Misses The Mark
By Chris Prandoni
Sens. Carper and Coburn propose bill that protects a bloated union workforce and paves the way for consumer rate increases.
With the United States Postal Service’s (USPS) $8 billion deficit driving Congressional action, Sens. Carper and Coburn have put forth a bill that protects a bloated union workforce and paves the way for consumer rate increases.
Rightsizing the workforce
Compared to the private sector, over 80 percent of the Post Office’s costs are labor related while FedEx and UPS spend 20-40 percent less. For years the USPS has acknowledged its excess capacity, yet S. 1486 delays necessary attrition by placing a two-year moratorium on plant closings.
If the Postal Service is to become profitable, it will need to reduce labor costs. Unfortunately, S. 1486 kicks the can down the road by perpetuating excess postal labor that the USPS can no longer afford. Additionally, the bill claws back private sector work sharing language that could reduce Postal Service costs.
Overpaid workers
USPS employees are paid far above expected market rates: 34% more than their private sector counterparts. The average annual compensation (including benefits) of a postal employee is well in excess of $80,000. While S. 1486 allows the Postal Service to establish a new retirement plan for new employees, the legislation does little to address inflated employee wages. It is the combination of too many employees that are paid too much that is dragging USPS into the red. The solution to USPS’s self-identified problems is to address these labor issues head-on, not look for more revenue through rate increases.