John McCain press release on postal reform legislation

WASHINGTON, Sept. 23 — The office of Sen. John McCain, R-Ariz., issued the following news release:

U.S. Senator John McCain (R-AZ) today introduced the Postal Reform Act of 2011, a bill to restore the financial health and long-term viability of the United States Postal Service. The Postal Service is expected to end this fiscal year with a $10 billion loss, and by its own estimates faces a shortfall of up to $238 billion by 2020. At the end of this month, the Postal Service will not be able to make a required $5.5 billion payment to fund future retirees’ health benefits. This legislation is needed to ensure that future generations of Americans will have a viable Postal Service. This bill is the Senate companion to the legislation introduced by Representative Darrell Issa (R-CA) in the U.S. House of Representatives this summer.

Senator McCain submitted the following statement for the record upon introducing the Postal Reform Act of 2011:

“Mr. President, today I am introducing the Postal Reform Act of 2011, which will restore the financial health and long-term viability of the United States Postal Service. This bill is the companion to the legislation that Representative Darrell Issa introduced in the House of Representatives in June of this year. I thank Representative Issa for his leadership on this important issue.

“According to their own estimates, by 2020 the Postal Service expects to face a shortfall of up to $238 billion. Even with dramatic cost savings of $12 billion and workforce reduction of 110,000 postal employees in the past four years, the Postal Service is expected to end this fiscal year with a $10 billion loss.

“First-Class mail, which makes up more than half of Postal Service revenues, continues to fall at alarming rates and shows no signs of ever recovering. This, combined with 80 percent labor costs and labor contracts that contain ‘no-layoff’ clauses, points to the fact that the Postal Service is broken.

“Congress can no longer enact temporary fixes that avert financial crisis for only a brief period. Congress, the Postal Service, labor unions, and the mailing community must be willing to lay everything on the table and make hard choices now to save the Postal Service for the future. I believe the Postal Reform Act of 2011 will do just that.

“Two key provisions in this bill alone would save the Postal Service billions of dollars annually. First, the bill would create a Postal Service Financial Responsibility and Management Assistance Authority, which is modeled after the District of Columbia control board Congress created to address the fiscal crises the city was facing in the mid-1990s. This Authority, triggered by a Postal Service default on its federal obligations, would replace the Postal Board of Governors with mandates to cut costs, and put the Postal Service back on a path to financial solvency.

“The second key provision would create a Commission on Postal Reorganization that would use a BRAC-like process to consolidate and close post offices and mail processing facilities. According to the Postal Service, the ‘current mail processing network has a capacity of over 250 billion pieces of mail per year when mail volume is now 160 billion pieces of mail. Right-sizing the network is vital to the future of the Postal Service and its customers.’ Congress, however, continues to put up political road blocks that prevent these closings and consolidations. This bill will take politics out of the process and allow the Postal Service to right-size its operations.

“Other provisions in the bill would require arbitrators to take into account the financial health of the Postal Service if labor contracts move to arbitration. It would also exempt the Postal Service from the Davis-Bacon Act, the Service Contract Act, and other wage rules that increase contracting costs.

“Additionally, there are certain types of mail upon which the Postal Service routinely loses money. This bill would require that the vendors responsible for this mail be responsible for covering their costs. In Fiscal Year 2010, the Postal Service lost nearly $1.7 billion on these type of ‘underwater’ postal products that failed to cover their costs. For example, the Periodicals class of mail, which includes newspapers and magazines, has not covered its costs for 14 consecutive years, generating total losses of $4.3 billion over that period.

“The bill also contains common sense language that would mandate that Postal Service employees pay the same health and life insurance premium percentage as other federal workers. This is estimated to save the Postal Service $700 million annually.

“Finally, this bill will allow the Postal Service to move to 5-day delivery, at a savings of anywhere from $1.7 to $3.1 billion annually.

“We can no longer support temporary fixes to the Postal Service. If we continue to act in this irresponsible way, the American taxpayer will be the one that ultimately suffers in the form of higher postage prices and taxpayer bailouts. We must make hard choices now so future generations of Americans will have a viable Postal Service.”

  • hey mister

    Way to go McCain, send the service right down the toilet. don’t even bring up pre funding or bailing the military out and 70 billion you guys stole from the service

  • Mailman666

    The US Postal Service, which has been around longer than the Constitution, and is one of the our trusted government organizations in this country, is evil because it is “outdated” and it can done better if “privatized”, and worse, pays its employees a living wage and decent benefits.

    If you look at net income from the year 1994 to year 2010, the US Postal Service has had a net income of $12.4 Billion, if not for the DAMN Postal Accountability and Enhancement Act of 2006!

  • cntry

    And Mr. McCain, just how much do YOU pay for your health insurance? And what about your obscene retirement plan? Just how much of your benefits were paid using postal money?

  • Bill


  • Tim

    John McCain,Our health plan is the same as yours, Lets lay off Congress by seniority,Starting with you

  • Mark

    Mccain, Issa and all the others know that the billions the usps has built up in prefunding the government has already spent. So they are trying to eliminate the usps to cover their tails by using the usps as a scapegoat. The usps has always been the easiest part of “government” to pick on when needed and with elections coming up, the scare tactics are out in full force so these so called experts on saving the usps can save their overcompensated “careers”. The only sane, constructive, positive way to save the USPS is passage of HR 1351, which by the way has the growing support of both parties. Don’t let crooks like Issa and Mccain get away with murder.

  • Vicki SD

    Mark, I agree with you 100%.

  • Charles

    im all for paying the same insurance costs as other federal workers, as soon as I get the 20% locality pay other federal workers in my town get..

  • Gregg

    Senator McCain, I am willing to pay the same amount as you for the same medical coverage that you get. I believe that you pay NOTHING toward the most excellent medical coverage in the world! How much, Senator, do you get from the taxpayers if and when you retire? Bet it’s a heck of a lot more than what I get. People in glass houses should not throw stones. Congress is the problem with the United States right now. Clean house and elect people who truly have the interest of the people in mind!

  • Gregg

    Issa is a joke. Being from California, it is easy to understand how he has no clue in regard to fiscal feasibility. Maybe Issa should run for Governor of California and clean up the mess in his own state rather than try to break unions and destroy the middle class of the US.

  • Liliana Franco

    Sen. John McCain, if you want us to pay more into life and health ins which I don’t see a big problem with and you want us to be more like the other fed. Agencies please explain y do we have to prefund benefits for postal workers that haven’t been born yet?
    Y are you not talking about the massive overhead in this comp. and the mill. they get paid. Instead you go after the middle class the ones making 45,000. or so per year. sure take the Sat. away no revenue coming in either like we can afford that genius lol. Y not work with H.R.1351? Because it makes sense?
    Thank you for your time

  • Chris

    Congress fails to realize that they caused the problems the Post Office are having. Congress is mandating that the Post Office pay 5.5 Billion to fund future retirees. So where is the money going? The Post Office could recover and sustain itself again if this mandate would disappear. The following website shows that the United Parcel Service was a top contributor to Darrell Issa. Looks like I help you, you help me type of deal.

  • Phil Terrana

    Why doesn’t Congress start paying for the mail they send back home at no cost to them and considerable cost to the USPS. I know that they claim to be keeping their constituents informed. These are clearly political newsletters which would be better funded by the political parties. I don’t want one more letter from my Congressman asking me to rate what I think is the greatest problem facing the country. Just pick a problem, any problem and fix it.

  • brian

    Congress does pay full postage for franked mail that Senators and Congressmen send.