This Weekly Update is a little different. We will be focusing on one particular issue, the United States Postal Service (USPS) and going in depth with some charts because two things happened this week: the House of Representatives passed the Postal Service Reform Act and the USPS announced a $1.5 billion loss for the first quarter of fiscal year 2022. I do want to point out that TPA hit the road and testified in a few states this week. Lindsey Stroud and Martin Cullip testified in Arizona, Hawaii, and Maine about vaping bans. Patrick was in Arizona testifying about app security, In part, Patrick’s testimony read: By overseeing in-app payments, consumers enjoy incredible protections. Centralized tracking and management of app subscriptions allows consumers to see and cancel all their subscriptions in one place. Ask-to-buy protects families against children making accidental or unapproved purchases within apps by alerting the account holder. Most importantly of all, by overseeing in-app
payments, store operators can protect their customers from credit card fraud. If a stolen credit card is used and flagged in one app, standardized in-app payment systems can stop purchases anywhere within the managed app store ecosystem. HB 2662 upends the ability for Apple, Google, and other store operators from standing with their customers and protecting their purchases. The legislation transforms app stores from secure digital department stores to online flea markets.” Read the whole testimony here ([link removed]) .
Postal Losses and Incomplete Reform Legislation
The United States Postal Service (USPS) has lost an astounding amount of money over the past fifteen years, bleeding more than $90 billion in red ink since 2007 ([link removed]) . As seen in the below figure, a high proportion of the USPS’ losses over the years have stemmed from financial decisions within the control of management.
The agency continues this troubling trend by reporting that it shed another $1.5 billion ([link removed]) in the first quarter of fiscal year (FY) 2022. This disturbing news comes at the same time that Congress prepares to vote on H.R. 3076, the Postal Service Reform Act of 2021 ([link removed]) . While H.R. 3076 contains some commendable proposals such as mandating more performance data tracking, it fails to adequately address the underpricing of packages. And, as the current net loss figures show, even an influx of revenue from packages during the last three months of the year (corresponding to the holiday season) is not enough to offset the high fixed and variable costs associated with parcel deliveries. Packages have taken up an increasing share of the overall mail haul, comprising nearly 60 percent of delivery weight in FY 2021. But interestingly, real revenue per
package pound shipped has decreased in recent years.
This needn’t be a cause for concern if revenues were nonetheless covering costs and delivery costs were declining (perhaps due to increased delivery efficiencies). Unfortunately, it appears that revenues are not in fact covering costs due to misguided agency cost attribution calculations. For example, the agency only attributes 10 percent of the costs of city carriers’ street activities to competitive products (i.e., packages) and 0 percent of headquarters expenses to packages. The latter figure is particularly implausible, given that headquarters staff regularly draft reports on package deliveries and negotiate agreements with e-commerce companies to deliver packages.
BLOGS:
Monday: How Unelected Bureaucrats are Using Your Taxes to Wage a Global War on Alcohol ([link removed])
Tuesday: USPS Loses Another $1.5 Billion in First Quarter of FY 2022 ([link removed])
Wednesday: Testimony before the Arizona House Judiciary Committee Regarding App Security ([link removed])
Thursday: Taxpayers Protection Alliance Responds to Higher-Than-Expected Inflation Rates ([link removed])
Friday: Broadband providers use new FCC program to close digital divide ([link removed])
Media:
February 7, 2022: WBFF Fox45 (Baltimore, Md.) interviewed me about unspent COVID funds.
February 8, 2022: The Center Square ran TPA’s op-ed, “Overlooked postal 'reform' provision spells trouble for USPS ([link removed]) .”
February 8, 2022: I appeared on Real America’s Voice ([link removed]) to talk about the latest jobs numbers.
February 8, 2022: WBFF FOX45 ([link removed]) quoted TPA in their story, “City Hall remains closed. FOX45 News digs into how long it will stay that way.”
February 9, 2022: I joined The Tim Jones & Chris Arps Show on News Talk STL ([link removed]) (St. Louis, Mo.) to discuss David Weil.
February 9, 2022: Alabama Today ran TPA’s op-ed, “Overlooked postal ‘reform’ provision spells trouble for USPS.”
February 9, 2022: Dan Savickas joined The Barrett Brief (New Orleans, LA) to discuss news of the day.
February 10, 2022: WBFF Fox45 ([link removed]) (Baltimore, Md.) interviewed me about the cost of violence in Baltimore, Md.
February 10, 2022: I appeared on WBOB 600 AM (Jacksonville, Fla.) to talk about infrastructure spending.
February 10, 2022: I appeared on News Talk STL ([link removed]) (St. Louis, Mo.) to discuss the latest inflation numbers.
February 10, 2022: The Center Square ran TPA’s op-ed, “Broadband providers use new FCC program to close digital divide ([link removed]) .”
February 11, 2022: Patrick Hedger joined The Will Anderson Show ([link removed]) (Podcast) to discuss small businesses and David Weil’s nomination.
Have a great weekend!
Best,
David Williams
President
Taxpayers Protection Alliance
1101 14th Street, NW
Suite 1120
Washington, D.C. xxxxxx
www.protectingtaxpayers.org ([link removed])
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