PHILADELPHIA — On Friday, President Donald Trump revealed that he is contemplating the idea of placing the U.S. Postal Service under the supervision of the Commerce Department. This potential shift would mark a notable change in the management of the agency, which has operated independently since its establishment in 1970.
“Our aim is to create a postal service that is efficient and does not suffer from significant financial losses,” Trump remarked. “We are considering this change, which might be seen as a merger, but the Postal Service would maintain its unique identity, and we believe this could lead to substantial improvements in its operations.”
Trump shared these insights during the swearing-in ceremony for Commerce Secretary Howard Lutnick. He characterized this potential transition as a means to tackle the financial challenges confronted by the Postal Service, a massive organization generating $78 billion annually that has been grappling with a drop in first-class mail volume.
Commending Lutnick’s business expertise, Trump said, “He possesses a sharp business acumen, which is precisely what we need at this moment. We are confident that we can turn the situation around. The Postal Service has become a considerable financial burden on our country, resulting in enormous losses.”
Here are some essential details about the U.S. Postal Service’s operations:
What is the history of the USPS?
The Post Office’s roots trace back to 1775 during the Second Continental Congress in Philadelphia, with Benjamin Franklin as its first postmaster general. It was recognized as an executive branch department in 1872, but this status changed after a wage and benefits strike in 1970. In the aftermath, President Richard Nixon signed the Postal Reorganization Act, which established the U.S. Postal Service as an independent and self-sustaining entity.
In recent times, the Postal Service has encountered severe financial troubles and has resisted calls for privatization from Trump and others.
Who is employed by the USPS?
The 1970 reorganization granted workers pay raises and collective bargaining rights, enabling many Americans, especially minorities, to attain middle-class status. Presently, the USPS employs approximately 640,000 individuals responsible for delivering mail, medications, election ballots, and packages throughout the nation, including remote areas and islands. During the COVID-19 pandemic, postal workers continued their vital services, with the American Postal Workers Union reporting over 200 fatalities.
Who oversees the USPS?
Louis DeJoy, a Republican donor and former logistics executive, was appointed as Postmaster General during Trump’s first term in 2020. Throughout his time in office, he has faced numerous challenges, including the pandemic, spikes in mail-in voting, and efforts to reduce costs and losses. Recently, he introduced a 10-year plan aimed at revitalizing operations, but he has since indicated intentions to resign, prompting the Postal Service Board of Governors to look for his successor.
How is the USPS board structured and selected?
The U.S. Postal Service Board is composed of up to nine members who are appointed by the president and confirmed by the Senate, with a maximum of five members belonging to the same political party.
Currently, Amber F. McReynolds, a former election official from Colorado, serves as chair, while Derek Kan, who worked in the Trump administration, is the vice chair. Both individuals were appointed by President Joe Biden.
There are three vacancies on the board due to the Senate’s failure to vote on Biden’s nominees for those positions. Biden appointed four out of the six current governors, while Trump appointed two.
The board has the power to hire and fire the postmaster general, who, along with a deputy postmaster, also serves on the board.
How is the USPS funded?
Since its reorganization in 1970, the USPS has primarily relied on self-funding. Its annual budget, approximately $78.5 billion, comes mainly from customer fees, as noted by the Congressional Research Service. Congress contributes a small annual appropriation — around $50 million for the fiscal year 2023 — to assist with free and reduced-cost mail services.
With challenges such as declining first-class mail revenues and costs associated with retiree benefits, the Postal Service accumulated $87 billion in losses from 2007 to 2020.
Last year, DeJoy unveiled a 10-year plan to modernize operations and recover losses, warning customers of potentially “uncomfortable” rate hikes as the Postal Service works to stabilize its financial situation.
Critics, including several members of Congress, have expressed concerns that previous consolidations have resulted in slower service and worry that further consolidations could negatively affect rural mail delivery.
What is Trump’s perspective on the USPS?
Since his first term, Trump has been outspoken about his criticisms of the Postal Service. In 2020, he threatened to withhold COVID-19 relief funding unless the agency raised its package rates for major customers like Amazon, owned by billionaire Jeff Bezos, who also owns The Washington Post, a publication that has frequently attracted Trump’s ire.
More recently, Trump has expressed an interest in exploring the privatization of the Postal Service, citing competitive pressures from companies like Amazon, UPS, and FedEx. “It’s a concept that has been discussed by many for quite some time. We are currently examining it,” he stated.
