USPS CFO responds to “Why the Post Office Gives Amazon Special Delivery” article

uspshq28/1/17 – While Josh Sandbulte gets some things right about the Postal Service in his self-serving opinion piece “Why the Post Office Gives Amazon Special Delivery” (July 14): he provides an inaccurate and unfair account of the package delivery side of our business.

By law our competitive package products, including those that we deliver for Amazon, must cover their costs. Our regulator, the Postal Regulatory Commission (PRC), looks carefully at this question every year and has determined that they do. The PRC has also noted that competitive products help fund the infrastructure of the Postal Service. It is that infrastructure that enables us to fulfill our universal service obligation to deliver to each and every address in the United States at an affordable rate.

The PRC has also concluded every year that products covered by the letter monopoly do not cross-subsidize the Postal Service’s competitive products. The reason we continue to attract e-commerce customers and business partners is because our customers see the value of our predictable service, enhanced visibility, and competitive pricing.

Despite our achievements in improving operational efficiency and growing revenue, we cannot overcome systemic financial imbalances caused by legal and other constraints. For instance, the Postal Service’s ability to adjust prices of products that produce over 70 percent of our revenue is restrained by an austere price cap that does not take changes in Postal Service volumes and costs into account, and hence is wholly unsuitable to ensuring the Postal Service’s continued ability to provide prompt and reliable universal services in a self-sufficient manner.

There is a path forward that depends upon the passage of provisions in H.R. 756 postal reform bill, combined with a favorable outcome of the PRC’s 10-year pricing system review and continued innovation and aggressive management actions.

With that, the Postal Service can meet all its obligations and continue to provide the service that all Americans, including those “traditional retailers,” deserve.

Sincerely,

Joseph Corbett
Chief Financial Officer
United States Postal Service
Washington, DC

17 thoughts on “USPS CFO responds to “Why the Post Office Gives Amazon Special Delivery” article

  1. Parcel volume up and the Postal Service still can’t cover it’s management cost! We should be getting AMAZON to deliver the mail too! Postal Management is too foolish, blind and GREEDY to know the ship they are riding on is almost sunk!!

    • retodd says Trump filed for bankruptcy 6 times (under the law) while the Postal Circus has lost over 120 Billion since 2009. now before you go into your rant about pre-funding canard, educate yourself that PMG Donahoe, Office of Budget & Management, and Congress all said it was a red herring. Sander’s is an admitted Socialist, as the say in the book “The Road To Serfdom” socialism is the road, communism is the distination”. if YOU were educated, you would know that Commie Sanders was the Chair of the Senate Select Committe on Veteran Affairs in 2015 and he blocked attempts to have the Bureaucrat Hospital Administrators fired for cause in the deaths of Veterans at the Phoenix, Az VA Hospital…………so a dummy like you should just keep quite before removing all doubt that you can only spout talking points from the lame stream fake news media like CNN, MSNBC, NY Slimes etc.(or worse yet the stupid postal unions) Postal Circus is going down next 8 years…..no more other people’s money to waste.they are banned from any more “loans” from the US Treasury(took 30 Billion out the back door, never paid back the taxpayers money-criminals)………another posted 2.1 Billion dollar loss for the quarter 3 days ago=annulized 8.4 Billion loss. hope retodd has a plan B to put food on the table. my guess is NO!

  2. Sgt Joe Friday, so Bernie is a commie? Wrong! Read a few books, become educated. You spend your time with Fix News and their right wing dribble. So what is your leader Donald Dump? Businessman that filed bankruptcy six times and cheated, with the help of the law, many other businessmen and workers out of their wages! Just read that the UMWU is angry that the Department of Labor won’t enforce mine safety laws. Now the UMWU is upset with the man they backed of President. It is their payback!

  3. with the losers at Headquarters cutting clerks and mailhandler bids to free up cash flow for the 110,000 mismanaging po mismanagers payroll……..I wonder why the postal dues collecting agencies (ie postal unions) have not hired a high powered Washington, DC Labor Law Firm to get a Federal restraining order or Federal Injunction for fact finding (or both) against these losers, who have lost over 120 Billion since 2009. if the Demonrats could get one to stop President Trumps Immigration Plan(shopped a judge all the way out in Hawaii), why don’t the Democraps get one for the working postal slugs. A-PEE-U endorsed that Commie Sen Bernie Sanders (the one who owns 3 houses and wife who plundered a college in Vermont-guess capitalist commies) how come he is missing in action on this one………kind of makes you think the fix is in…..again! I though DemoKKKats ….GOOD and Rethuglians…….BAD? guess like a Janus coin just two heads on the same coin. HMS Postal Titanic Full Speed Ahead LOL! UPS, FDX, AMZN, WMT, TGT,…..all laughing their way to the bank while the US Postal Circus is in a “death spiral”.

  4. I’ve been saying it for years. The greed of Capitalism must be smashed! Bezos, and his greed must be smashed!!!! Socialism NOW!!!!!

  5. Amazon along with most parcel providers to USPS are on an “honor” system when it comes to paying for postage. They get “lite” audits maybe 4 times a year. Its a stacked deck in favor of shipper. USPS is so hard up for postage, we’ll take things at a loss and fudge numbers to make it look OK

  6. number 1) Former PMG Donehoe and Federal Dept Office Personnel Management said prefunding was a red herring….only dopes keep talking about the fake news. 2) Amazon (AMZN stock at $1000 a share) internal memo states USPS delivery sucks and is going to deliver their own goods….hired 50,000 yesterday and placed an order with Boeing to purchase 90 767 Freighters to go with the 40 they have now. UPS, FDX, AMZN, WMT, TGT all going to deliver packages…..and leave the Postal Circus in the dust. when the Postal Circus’s revenue drops below a certain point that it can not support the monster infrastructure……..congress will do with it what they do with old battle ships….tow it out 200 miles into the ocean-and sink it! about time. you can not run a company with all mismanagers and no workers…..problem is these morons think differently.

  7. I’ve read this three times. This man has said nothing in response to the initial allegation. There is no way that we are covering costs for Amazon’s Sunday delivery, for a start.

    On top of that, Amazon is building out its own network in the more densely populated cities, leaving the rural and less dense areas for us. It is entirely appropriate for there to be some sort of subsidy in those areas, it is the reason for our existence.

    Universal service is incompatible with a money making business model and I’m tired of our own leadership pretending otherwise.

    • Yeah…this clown would have been better off keeping his mouth shut….now he’s removed all doubt that he’s just another inbred stuffed suit drinking the Kool-Aid at L’Enfant Plaza.

  8. Thought I read where the postal reform bill was dead in the water….so surprised to see Corbett referencing it.

    • W Todd, What’s more disturbing than all, is Former Congressman George Miller quoted in a letter, dated January 3, 2012 that H.R. 2309, The Postal Reform Bill of 2011 is ” of particular concern to him. This Bill would also create a new ‘Solvency Authority” with the power to unilaterally reject, modify,or terminate existing collective bargaining agreements with U.S.P.S. workers…a continuation of the sustained attack on public workers across the country, i.e. Even though the bill number has changed the damage is the same. Further stated by Congressman Miller H.R. 2309 may partially address the financial shortfall, there’s other ways to do so w/o dramatically affecting USPS services and undermining workers’ rights. Independent Actuarial studies have shown that the primary challenge is the fact that the USPS has overfunded its Civil Service Retirement Fund (CSRS) by $50 to $75 Billion and the Federal Employee Retirement System (FERS) by an estimated $6.9 Billion. These overpayments are required by law and, along with mail volumes and a shift to email, it is this situation- not the collective bargaining rights of Postal Service employees- that has contributed to the USPS’ cash shortages. Clearly defined and unexplained, What happen to these funds? Where’s the money, now a great effort is heading to more lies and deception? Can we get an answer?
      The OIG stated there’s money totaling $75 Billion at one time in the USPS coffers, where is this Mr. OIG?

  9. The Wall Street Journal instead should have asked why is the Postal Service, and only the postal Service, required to prefund health care costs. He should have said every employer in America should prefund health care costs. I have traveled in very rural areas of America. One hundred or more miles between cities. I would imagine UPS and Federal Express would love to go to the hard to reach spots. They would charge a fortune for their deliveries. Business won’t do anything unless they make lots and lots of money! Private business would only pick the creamy locations, and let the Postal Service have the places the big money suckers would avoid. The private hoarders would allow the Postal Service keep their monopoly only in the rural areas! Places the businessmen would pass over.

  10. We would love to know how much the Post Office gets for delivering each Amazon piece. Thats a special price and it’s rumored to be as low as 75 cents.

    • Data Techs at one time were responsible for LP issues (lost prevention). Is that not true for today changes?

  11. “By law”………..whew that’s a relief. ‘Cause we all know how well the USPS adheres to following laws, labor contracts, etc.

    Right ?

  12. Systemic financial imbalances include a bloated bureaucracy with thousands of non- essential jobs that have nothing to do with moving the mail. These jobs could be eliminated with no affect on service.

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