Did you know that the price you pay for U.S. mail is about to increase, even as our nation still struggles under the weight of the COVID-19 pandemic? If you didn’t, you’re not alone. According to a national survey conducted this summer, 77 percent of the American public was not aware of the postage hike.
First-class mail and “forever stamps” are set to increase on Aug. 29 from 55 cents to 58 cents. Rates for most mail will rise by 7 percent, while charities and other nonprofits, magazines, newspapers and catalogs will face an even bigger postage increase of 8.8 percent.
Thanks to a recent Postal Regulatory Commission ruling giving the U.S. Postal Service more power to raise rates, these increases are three-to-four times inflation and follow yet another postage increase earlier this year.
It’s all part of the Postal Service’s 10-year plan — which predicts mail will decline over the next decade and therefore outlines steps to proactively make mail slower and more expensive.
But there are signs showing that plan could be a self-fulfilling prophecy.
Demand for mail is increasing now as the economy recovers. In its third quarter ending June 30, USPS registered an increase of nearly $1.1 billion in revenue from mail in comparison to the same quarter last year. With virtually every business and person in the country relying on it, the Postal Service generated over $73 billion in operating revenue in 2020 — more than it did in 2019. If it were a private sector company, the Postal Service would rank 46th in the Fortune 500. It’s also important to recognize that the U.S. Postal Service receives no taxpayer funding aside from a one-time COVID-driven grant, and that businesses provide more than 90 percent of its revenues.
The reality is that postage rate hikes, paired with decreased service, will drive many American small businesses, community newspapers and charities away from using USPS, or, in some cases, out of business altogether. Meanwhile, larger businesses are already planning to divert more mail into digital communications because of the coming delays and price increases. Such a major decrease in business demand for mail will lead to considerably less USPS revenue, meaning that major postage hikes and service delays will keep happening — making mail increasingly unaffordable and undependable for everyone.
Fortunately, Congress has an opportunity to help. Sen. Jerry Moran (R-Kan.) has submitted a request to the Senate Financial Services and General Government Appropriations Subcommittee to direct the Postal Regulatory Commission to reconsider the broader rate-setting authority it gave USPS — this time while factoring in the impact of COVID-19, which was not considered before.
In addition, The Postal Service Reform Act (S. 1720, H.R.3076), which is pending before the House and the Senate with bipartisan support, would give the Postal Service more financial breathing room to keep delivering for the American public. The legislation would free the Postal Service from a 2006 law requiring the Postal Service set aside funds for retiree health benefits 75 years in advance — a huge expenditure which no other governmental or private entity is required to do that has been crippling postal finances for 15 years.
Congress must step in and pass the Postal Service Reform Act so that the Postal Service can regain its financial footing, but it also needs to direct the Postal Regulatory Commission to reassess the way USPS raises postage rates.
When we were isolated during the COVID-19 pandemic, the Postal Service was a critical lifeline for millions of Americans, delivering medicines, personal protective equipment, food and other household staples. For many Americans, especially in rural areas, it still is a lifeline and always has been.
Without action from Congress, it won’t be rain or snow or heat or gloom of night stopping the mail; it might just be the U.S. Postal Service’s own decisions.
Art Sackler is executive director of the Coalition for a 21st Century Postal Service—an organization of public and private companies, trade associations and other industry groups which rely on the U.S. Postal Service to do business.