It's no secret that the U.S. Postal Service is in a financial crisis. It lost $5 billion in fiscal year 2013, its seventh consecutive net loss. At the end of 2012, it had reached its $15 billion debt limit and defaulted on billions in payments to avert bankruptcy. Clearly, we must bring financial stability to this critical federal agency.
Part of these financial woes can be blamed on Congress: in 2006, Congress passed a crippling law requiring that the U.S. Postal Service prepay — in just one decade — the next 75 years of future employee health benefits. About 80 percent of Postal Service financial losses are due to this extreme and unreasonable mandate, which should be repealed immediately.
But the Postal Service's financial problems also stem from failures to innovate, modernize and compete. Nowhere is that better illustrated than with the agency's vehicle fleet. USPS owns and operates the world's largest civilian fleet: 192,000 mail delivery vehicles that are driven 4.3 million miles per day. Fueling all of those vehicles adds up to an astronomical cost for the agency: In fiscal year 2010, the fuel bill for all postal transportation totaled $1.7 billion. Vehicle maintenance adds a staggering $750 million cost to the agency's strained budget.
The overwhelming majority of USPS vehicles (more than 141,000) are aging Grumman LLVs, the classic mail truck we started seeing every day in our neighborhoods around 1987. Most of them get less than 10 mpg and are at or near the end of their 24-year operational lifespan. Many are on their last leg — just ask your letter carrier. Stories are legion about letter carriers reporting problems with these failing clunkers only to be told to keep driving them until they break down — a shortsighted policy that has the opposite effect of saving money: Each year USPS exceeds its vehicle maintenance budget, and each year the problem gets worse.
We are seeing progress with other federal government vehicles. Thanks to an executive order signed by President Barack Obama in 2009, the federal fleet will reduce petroleum use 30 percent by 2020, saving money and cleaning the air. As an independent agency, however, the Postal Service is exempt from this crucial effort and is headed in the wrong direction on fossil fuel consumption. Since 2005, USPS has marked a 6.4 percent increase in petroleum use.