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The “Exigency” Case and Real Postal Reform

Remember last year, when the Postal Service announced there would be no rate increases in 2010? The USPS has been as good as its word, but come January 2, 2011, rates will go up again – and how. That’s the forecast from last week’s “exigency” rate proposal, which includes a painful hike of 5 to 6 percent on average across most mail classes and even greater increases for Periodicals and Package Services. If approved by the Postal Regulatory Commission, these hefty increases will take effect right after the New Year – a belated Christmas present to a beleaguered industry.

BCC Software supports a strong Postal Service: Shrinking mail volumes aside, direct mail remains a vital mainstay of the American economy. That said, we must add our voice to those who vigorously oppose this latest rate increase, and indeed any increases that suggest the USPS is simply not charging enough for its invaluable services. On their own, higher rates will only artificially accelerate the industry’s compression without addressing the real issues – fiscal and otherwise – that continue to plague the USPS.

The Coalition for a 21st Century Postal Service, a group of concerned organizations representing corporate America’s stakeholders in the fate of the postal industry, wrote letters earlier this year to the U.S. Senate and the House of Representatives that outlined necessary steps to accommodate the real-world changes that drive so much of the pressure on the USPS. A combination of steps – including measured rate increases, strategic partnerships with the private sector and a long-overdue restructuring of the bloated USPS Retiree Health Benefit Fund – would remedy the current financial situation while creating a new model of relative stability and even growth in the years to come.

Fixing the United States Postal Service requires much more than a price hike – and although Congress has been removed from the approval process for this one-time exigency increase, our leaders in Washington are in fact the only ones with the power to truly solve the real postal crisis. I implore you to reach out to your Congressional representatives and encourage that they act in support of the steps outlined by the Coalition. Without real postal reform, the “exigency” will only get worse.