Postal Service says it's going broke due to pandemic, Trump flatly opposes emergency aid
The already-ailing United States Postal Service is being financially crippled by the coronavirus pandemic, its top official says, but the Trump administration has shown no signs it will ask for emergency financial aid as it has for big businesses.
In a digital briefing before the House Oversight Committee last week, Postmaster General Megan Brennan told lawmakers that the agency would "run out of cash" by the end of the fiscal year in September without help from Congress and the administration, in part due to extreme losses being suffered as a result of COVID-19.
Brennan said the crisis has caused an unprecedented drop in mail. The Postal Service, an independent agency of the executive branch, anticipates “a $13 billion revenue loss directly to COVID-19 this fiscal year and a $54.3 billion additional losses over ten years,” she said.
The Postal Service relies on the sale of postal products and services to fund our operations, and these sales are plummeting as a result of the pandemic,” Brennan said. “The sudden drop in mail volumes, our most profitable revenue stream, is steep and may never fully recover.”
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Yet, even as the amount of mail being shipped drops, postal workers remain on the front lines of the pandemic. Many postal handlers continue to deliver mail -- designated as "essential service providers" during state stay-at-home orders.
A USPS spokesperson told ABC News Monday that 693 of the agency's 630,000 postal workers have tested positive for COVID-19. Several have died.
And the number infected is increasing steadily, up from 259 workers confirmed to have contracted COVID-19 on April 2.
The agency is providing millions of gloves and masks to its workers and has implemented social distancing practices inside of post offices, the spokeperson said.
Despite the financial crisis, on Friday, when President Donald Trump was asked about whether the administration had nixed funding for the agency being negotiated as part of coronavirus relief packages, he returned to a familiar refrain: He pointed the finger of blame at Amazon.
"I’ll tell you who’s the demise of the Postal Service are these internet companies that give their stuff to the Postal Service," Trump said. "They lose money every time they deliver a package for Amazon or these other internet companies, these other companies that deliver."
Trump has had a longstanding feud Jeff Bezos, the CEO of Amazon and owner of the Washington Post, and has blamed Bezos for the demise of the Postal Service for several years.
"I am right about the Amazon costing the United States Post Office massive amounts of money for being their Delivery Boy," Trump tweeted in 2018. " Amazon should pay these costs (plus) and not have them bourne [sic] by the American Taxpayer."
On Friday, Trump advocated, as he long has, for the Postal Service to raise the prices it charges online services like Amazon to deliver goods, often to hard-to-reach rural areas.
"They have to raise their prices; otherwise, they’re just going to lose a lot of money," Trump said. "The Post Office has been losing billions of dollars a year for many, many years."
Lawmakers on Capitol Hill had tried to work aid for the Postal Service into the $2.2 trillion coronavirus relief packaged passed in March. But the $13 billion dollar grant lawmakers initially agreed to never made it across the finish line, due in part to objections from administration negotiators, according to the Washington Post.
The Washington Post reported that Treasury Secretary Steve Mnuchin threatened to tank to the entire relief package if a grant for the Postal Service was included.
Instead of a grant, lawmakers inserted a $10 billion loan into the stimulus package. That loan is still awaiting approval by the Treasury while the agency struggles to hang on.
Even if the loan is approved, some Democratic lawmakers say it won't be enough.
"The Postal Service is insolvent," Rep. Gerry Connolly told NPR. "It needs debt forgiveness not debt extension, and it needs an infusion of capital right now."
During Brennan's briefing, she told lawmakers that the bipartisan Postal Service Board of Governors asked Congress to provide the Postal Service with $50 billion in emergency funding and access to an additional $25 billion in borrowing authority from the Treasury Department.
"The Postal Service is holding on for dear life, and unless Congress and the White House provide meaningful relief in the next stimulus bill, the Postal Service could cease to exist," House Oversight Committee Chairwoman Carolyn Maloney said in a statement.
For years, the agency has struggled to make a profit. This is in part due to congressional mandates that require the Postal Service to pre-fund retirement health care benefits for not-yet-retired workers through the year 2056. But the swell in technological communication has also left the agency struggling in the face of declining use of its service.
It says mail capacity has decreased by 28 billion parcels over the last 10 years, and there's been a 23 billion parcel decrease in first-class mail, a significant revenue stream.
What to know about coronavirus:
- How it started and how to protect yourself: coronavirus explained
- What to do if you have symptoms: coronavirus symptoms
- Tracking the spread in the US and Worldwide: coronavirus map
