President Donald Trump on Thursday issued an executive order creating an inter-agency task force that will be responsible for recommending reforms for pulling the U.S. Postal Service out of a tailspin that has resulted in $65 billion in losses since 2009.
President Donald Trump has ordered an official review of the U.S. Postal Service amid a highly public spat with one of the agency’s largest customers.
The president on Thursday issued an executive order creating an inter-agency task force that will be responsible for identifying issues that have led the USPS to report a combined $65 billion in annual losses since the Great Recession, as well as recommending legislative reforms in an effort to pull the agency out of its current tailspin.
According to the order, the USPS “accounts for almost half of global mail volume and is regularly cited as the federal agency with the highest public approval rating,” but a “steep decline in First-Class Mail volume, coupled with legal mandates that compel the USPS to incur substantial and inflexible costs, have resulted in a structural deficit where revenues are no longer sufficient to fund the pension liabilities and retiree health obligations owed to current employees.”
“The USPS is on an unsustainable financial path and must be restructured to prevent a taxpayer-funded bailout,” Trump said in the order, noting that the Government Accountability Office has had the USPS on its “high-risk” list since 2009 due to its dire financial condition.
The task force will be chaired by Secretary of the Treasury Steven Mnuchin (or his designee), along with the heads of the Office of Management and Budget, the Office of Personnel Management, and any other department and agency Mnuchin deems necessary, with the goal of evaluating the operations and finances of the USPS. The task force will also consult with the postmaster general and the chairman of the Postal Regulatory Commission throughout its review, as well as the U.S. Attorney General on issues relating to government monopolies operating in the commercial marketplace; the Secretary of Labor on issues related to workers compensation programs, and other state, local, and tribal officials as needed.
The review will include an examination of “the expansion and pricing of the package delivery market and the USPS’s role in competitive markets; the decline in mail volume and its implications for USPS self-financing and the USPS monopoly over letter delivery and mailboxes; the definition of the ‘universal service obligation’ in light of changes in technology, e‑commerce, marketing practices, and customer needs; the USPS’s role in the U.S. economy and in rural areas, communities, and small towns; and the state of the USPS business model, workforce, operations, costs, and pricing,” according to the executive order.
Once the review is completed, the task force will then develop recommendations for administrative and legislative reforms designed to “promote our Nation’s commerce and communication without shifting additional costs to taxpayers,” as well as “consider the views of the USPS workforce; commercial, non-profit, and residential users of the USPS services; and competitors in the marketplace,” the order states.
The executive order comes shortly after Trump recently stepped up his longstanding feud with Amazon and owner Jeff Bezos, who also owns the Washington Post, a publication the president has often singled out in his attacks on the mainstream media.
Trump has often accused the e-commerce giant of skirting its tax-paying responsibilities and of not adequately compensating the USPS for delivery costs.
In a series of tweets at the end of March, Trump also took Amazon to task over the effect it has had on the retail industry, particularly brick and mortar-based companies that have struggled to match the lower pricing and home delivery speed options Amazon provides its customers after having made similar accusations about the company at various times in his first year in office.
And Trump is by no means the first to highlight concerns with regard to Amazon’s rapid rise to online retail domination. Many retailers, both traditional and online, have suggested that Amazon’s business model and the wild west feel of the emerging e-commerce market has allowed the company to exploit loopholes in a market that is still struggling to find the proper balance between open competition and regulation.
Amazon is nowhere near having a true monopoly on e-commerce sales, but the relatively high percentage of e-commerce growth it has captured, along with high market share concentration in other divisions like its Amazon Web Services (AWS) business, has raised anti-trust concerns of late.
As many analysts have pointed out, however, because Trump’s criticisms of Amazon have often been perceived as an end-around attack on Bezos and the Washington Post, which has been highly critical of the president since he took office, they have mostly been seen as mere sound and fury, ultimately signifying nothing.
With this latest executive order, Trump is sending a clear signal that his critique of the USPS—and to a lesser extent Amazon’s role in the deterioration of agency profits—is more than just lip service.
Trump orders USPS review amid Amazon spat
