PHILADELPHIA — On Friday, President Donald Trump announced that he is considering placing the U.S. Postal Service under the jurisdiction of the Commerce Department. This potential move would signify a significant shift in the agency’s governance, which has functioned independently since 1970.
“Our goal is to have a post office that operates efficiently and doesn’t incur massive losses,” Trump stated. “We are contemplating this change, which could be viewed as a merger, but the Postal Service would still retain its identity, and we believe it would improve its operations significantly.”
Trump shared these thoughts during the swearing-in ceremony for Commerce Secretary Howard Lutnick. He described this potential transition as a strategy to address the financial issues faced by the Postal Service, a $78 billion-a-year organization that has struggled with the decline in first-class mail volumes.
Praising Lutnick’s business acumen, Trump remarked, “He has a keen sense for business, which is exactly what we need right now. We believe we can turn things around. The Postal Service has been a significant financial drain on this country, leading to tremendous losses.”
Here are some key points regarding the operations of the U.S. Postal Service:
What is the history of the USPS?
The origins of the Post Office date back to 1775 during the Second Continental Congress in Philadelphia, with Benjamin Franklin serving as the first postmaster general. It was designated as an executive branch department in 1872, but this changed after a strike over wages and benefits in 1970. Following that strike, President Richard Nixon enacted the Postal Reorganization Act, establishing the U.S. Postal Service as an independent, self-sustaining entity.
In recent years, the Postal Service has faced significant financial difficulties and has pushed back against calls for privatization from Trump and others.
Who is employed by the USPS?
The reorganization in 1970 provided workers with pay increases and collective bargaining rights, helping many Americans, particularly minorities, achieve middle-class status. Currently, the USPS employs around 640,000 individuals responsible for delivering mail, medications, election ballots, and packages nationwide, including to rural areas and remote islands. During the coronavirus pandemic, postal workers continued to serve, with more than 200 fatalities reported by the American Postal Workers Union.
Who oversees the USPS?
Louis DeJoy, a Republican donor and former logistics business owner, was appointed as Postmaster General during Trump’s first term in 2020. Throughout his tenure, he has faced numerous challenges, including the pandemic, surges in mail-in voting, and efforts to mitigate losses through cost reductions and service adjustments. Recently, he announced a 10-year plan aimed at revitalizing operations but has since indicated plans to resign, prompting the Postal Service Board of Governors to seek his successor.
How is the USPS board structured and selected?
The U.S. Postal Service Board consists of up to nine members, appointed by the president and confirmed by the Senate, with a maximum of five members from the same political party.
Currently, Amber F. McReynolds, a former election official from Colorado, serves as chair, while Derek Kan, who worked in the Trump administration, serves as vice chair. Both were appointed by President Joe Biden.
There are three vacancies on the board due to the Senate not voting on Biden’s nominees for those positions. Biden appointed four of the six current governors, while Trump appointed two.
The board has the authority to hire and dismiss the postmaster general, who along with a deputy postmaster, also serves on the board.
How is the USPS funded?
Since its reorganization in 1970, the USPS has primarily funded itself. Its annual budget of approximately $78.5 billion largely derives from customer fees, according to the Congressional Research Service. Congress provides a small annual appropriation — about $50 million for fiscal year 2023 — to support free and reduced-cost mail services.
Facing challenges such as dwindling first-class mail revenues and the expenses of retiree benefits, the Postal Service incurred $87 billion in losses between 2007 and 2020.
Last year, DeJoy unveiled a 10-year strategy to modernize operations and recover losses, cautioning customers about “uncomfortable” rate increases as the Postal Service attempts to stabilize its financial health.
Critics, including several members of Congress, have voiced concerns that previous consolidations have led to slower service and fear that further consolidations could particularly impact rural mail delivery.
What is Trump’s perspective on the USPS?
Since his initial term, Trump has been vocal about his criticisms of the Postal Service. In 2020, he threatened to withhold COVID-19 relief funding unless the agency increased its package rates for large customers like Amazon, owned by billionaire Jeff Bezos, who also owns The Washington Post, a publication that has often drawn Trump’s ire.
More recently, Trump expressed interest in privatizing the Postal Service, considering the competitive pressure from companies like Amazon, UPS, and FedEx. “It’s an idea that many people have discussed for quite some time. We are examining it,” he noted.
