Postal price increase is a bad idea at bad time

Friday, July 30, 2010

The National Newspaper Association, to which this newspaper belongs, has joined the fight to halt the Postal Service's "exigent" price increase filed July 6 with the Postal Regulatory Commission (PRC). The price increases includes a 2 cent hike on the first-class stamp, but a much more serious increase for the mailing of newspapers and magazines.

The increase will also affect churches, community organizations and labor groups that use nonprofit mail. It will affect businesses that use the mail for communications and advertising. It will affect catalog companies that send packages in the mail. It will affect everyone.

The new rates will be effective Jan. 2, 2011, unless the PRC stops them.

In 2006, a price cap that held postage rates within inflation levels went into effect as a result of the work of NNA and other groups representing users of the mail. That cap allows increases only within the Consumer Price Index as tracked by the PRC, which is under 1% currently. USPS wants an average of 5% increase in postage. The proposed rates would weaken the cap and maybe destroy it forever.

To be sure, the Postal Service is allowed to increase rates beyond inflation when an "exigency" occurs. It argues to the Regulatory Commission that recession+Internet competition equal exigency. But when the law was written, USPS had just suffered an attack of anthrax in the mail, which could have shut down the entire system. That is the sort of "exigency" that Congress had in mind, not an inability to control the cost of service.

Newspapers and many other employers in our communities have had to cut wages, benefits and hours of employees during this recession. These are painful and harsh. But the Postal Service has done no layoffs. It has passed along wage increases during the recession. It must get serious about controlling its costs.

While Congress has no immediate role in the rate case, our Congressional delegation should be aware of your opposition, as citizens and voters, to both this price increase and 5-day delivery, where they are the decision makers.

These postage rates are a bad idea at a bad time.