Washington, DC – The Affordable Mail Alliance, an unprecedented coalition of Postal customers, is today calling on the Postal Regulatory Commission to reject the United States Postal Service’s new proposal to increase postal rates by ten times the rate permissible by law. The new coalition includes charities, large and small businesses, American household names and the customers who use the Post Office every day – customers that will suffer if USPS successfully raises rates again.

“This proposed rate increase amounts to another tax imposed on Americans at a time when the economy can least afford it,” said Tony Conway, Executive Director of the Alliance of Nonprofit Mailers and Spokesperson for the Affordable Mail Alliance. “Consumers everywhere will pay more for the letters and packages they need to send; struggling businesses – large and small – will suffer and even more jobs will be lost.”

The Postal Service claims that a rate increase is essential to maintaining its solvency. However, USPS has done little to improve its business model. For example, the average USPS employee is paid substantially more than comparable private sector jobs. In 2009, USPS volume went down 13%, but labor costs only went down 1%. Because of work force issues, many USPS employees are under-used or sit idly, forcing consumers to subsidize them.

This rate increase will decrease mail volume, making the USPS’ economic situation even worse through declining number of customers. And that, in turn, will be multiplied into job losses to publishers, printers, paper manufacturers, marketers – jobs that can hardly afford to be lost in this economy.

While the USPS retained consulting companies to create a plan to tackle the crisis, little has been done to implement the cost saving recommendations. For example, facility consolidation is moving at a glacial pace.

“The first rule of business is if you’re in the hole, stop digging,” said Conway. “Increasing rates won’t put the Postal Service back on track – it will just drive more customers away, making their situation even worse. USPS needs to stop avoiding the difficult decisions and stop taking out their problems on the customers they desperately need.”

“Rather than gouging its customers with ten times the rate permissible by law, USPS should be eliminating its costs; inflation in postal costs was over 6% in 2009,” said Jerry Cerasale, Senior Vice President, Government Affairs and Spokesperson for the Affordable Mail Alliance. “They should be making the hard business decisions and not raising rates.”

The Postal Service is asking the five-person Postal Regulatory Commission to waive a rule requiring that postal rate increases stay in line with inflation – a law designed to protect Americans from just this kind of rate hike. The Affordable Mail Alliance is calling on Postal Regulatory Commissioners not to exploit a legal loophole to let the USPS make egregious rate hikes.

For more information on the Affordable Mail Alliance, contact Jessica McCreight (202) 464-6959; jmccreight@skdknick.com

This entry was posted on Tuesday, July 6th, 2010 at 8:37 am and is filed under postal, rate increase. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.