As Congress considers legislation to reform the business model of the U.S. Postal Service, it must confront a basic choice: to permit the Postal Service to function more as a business does, or constrain it from doing so.
With greater flexibility, the Postal Service can return to profitability. A flexible business model would speed decisions, enable a five-day-per-week delivery schedule and permit the realignment of processing, delivery and retail networks to meet lower mail volumes. It would also allow the Postal Service to more effectively manage its health care and retirement systems, and better leverage its work force.
The flexibility to quickly react to the marketplace is vital. Our immediate goal is to reduce annual costs by $20 billion by 2015, which would put the Postal Service in the black and ahead of the long-term cost curve.
The alternative is a business model that prohibits or delays cost reduction, perpetuates an inflexible structure and constrains the service from being more responsive to the marketplace. Under this scenario, and in the absence of meaningful and immediate reform, the Postal Service could soon incur long-term deficits in the range of $10 billion to $15 billion annually.
Within the limits of our current legal framework, we have responded aggressively to a changing marketplace -- reducing the size of our work force by 128,000 career employees and reducing annual operating costs by $12.5 billion in just the past four years. However, to return to profitability we must move at an even faster pace. And to do so requires changes in the law.
If provided with the flexibility and speed to act, the Postal Service can avoid being a financial burden to the taxpayer. More importantly, a financially stable Postal Service that can operate more like a business can more readily adapt to America's changing mailing and shipping needs.
For example, we are expanding our network of 70,000 retail partner locations and online offerings so that our customers will be able to purchase stamps and conduct other mailing and shipping transactions outside of the traditional post office. Customers will increasingly be able to visit gas stations, grocery stores and pharmacies -- which are part of regular shopping patterns, are open longer hours and weekends and are more conveniently located -- to conduct their postal business.
If the Postal Service is to endure as a great American institution, provide the nation with a secure, reliable and affordable delivery platform and serve as an engine of commerce, Congress should provide it with the speed and flexibility it needs to compete in an evolving marketplace.
The Postal Service is far too integral to the economic health of the nation to be fastened to the past and to an inflexible business model. To best serve taxpayers and postal customers, it's time to remove the constraints.
Kathleen Burns is Western New York district manager for the U.S. Postal Service.