BtoB

Postal service on fast track to reform in ’04

By Published on .

Most Popular

If you want a prime example of the need for postal reform, look no farther than Cape Cod, says Gordon Hughes II, president-CEO of American Business Media. If you run out of stamps you can visit any one of 56 post offices on the Cape.

The way Hughes sees it, Congress, with the recommendations of the President’s Commission on the U.S. Postal Service in hand, has an excellent opportunity to finally get the agency in order. That means cutting costs by consolidating facilities and slashing jobs.

"If you don’t take on the cost issue, you’re going to fail," Hughes said in an interview last month at ABM headquarters in New York. "This is the one opportunity to let the post office really get a grip on itself."

Because of the labor issues, it will take a "lot of guts" for Congress to act, Hughes said, especially in an election year. "I think that’s why the postal thing will be fast tracked, because it affects a lot of jobs and a lot of congressmen," he said. "They’ll want to get that thing done right away so people forget about it." He said he expects Congress to act by April.

H. Robert Wientzen, president-CEO of the Direct Marketing Association, said in an interview later the same day that he looks for Congress to act on postal reform in the fall, in conjunction with the end of the federal budget year. "I initially did believe that an election year would keep the issue from being dealt with," he said.

As for shuttering facilities, Wientzen said, "If it comes down to a bankrupt post office or closing some facilities, I think we’re going to close some facilities."

Hughes and Wientzen expect a bipartisan effort on postal reform. "Most people can figure out what’s good," Hughes said. "I don’t think party affiliation has a lot to do with it."

"There is now bipartisan acknowledgement that we have to do something about the post office," Wientzen said. "We don’t have the luxury of a protracted political fight."

While they agree on many postal reform issues, Wientzen and Hughes differ over a key proposal—tying future postal rate increases to the consumer price index or a similar barometer. "We want to see it," Wientzen said. "We helped author the concept four or five years ago."

But Hughes is dead set against the proposal. "That to me is one of the most ridiculous things I’ve ever heard because it doesn’t allow the post office to manage its costs and prices," he said. "We’re absolutely, vehemently opposed to that."

John Obrecht is managing editor of BtoB and can be reached at jobrecht@crain.com.

In this article: