Public Service versus Business
Delivering on the Promise of the United States Postal Service
“There is no Democratic or Republican way of delivering the mail,” proclaimed President Richard Nixon to Congress on May 27, 1969. “There is only the right way.” Nixon was rolling out his version of postal reform to convert the United States Post Office Department (USPOD) from a government department to the United States Postal Service (USPS), a government corporation with collective bargaining rights for postal workers. The USPS is a product of 1960s clashes over USPOD growing deficits, technological lags, poor work culture, and finally a wildcat strike that forced the issue over wages, worker rights, and the future status of the post office.
During congressional debates about the future of the postal service, postal workers began a nationwide postal wildcat strike from March 18–25, 1970. Postal workers earned from $6,176–8,422 a year at a time when the average annual American household income was $9,430. In addition to a substantial wage increase, the strikers won collective bargaining rights in the final version of Nixon’s 1970 Postal Reorganization Act (PRA, also known as Title 39).
The PRA, calling for the USPS to “bind the nation together,” intended to make the USPS self-supporting, not profit-driven. Unintentionally, its advocates set the stage for the popular reframing of the post office as a “business” that could deliver the mail without subsidies—ever. The PRA created a hybrid model for the USPS, part business and part government service. Under the PRA, postal workers became the only federal employees with full collective bargaining rights (except for the right to strike) and also made the USPS vulnerable to devastating congressional oversight that hobbles it today.
The PRA that Nixon signed on August 12, 1970, does not include the words “business,” “business model,” or “corporation.” Yet Nixon used some of those terms in his 1969 speech to contend that the future USPS should “operate like a business.” His intent was to “sell” the idea of a commercialized postal agency to Congress based on two paradoxical tropes: the “inefficient, non-business like” government agency that routinely had run up deficits since 1838 and the underpaid, disempowered postal workers who deserved better, just like their bosses and customers. Nixon asserted that mail processing and delivery would work better with unspecified “business methods.” Meanwhile, he kept wage increases low for postal workers (as had his predecessors), while threatening to veto any bill that would provide collective bargaining rights to postal workers in a reformed USPOD.
The 1970 Postal Reorganization Act created a hybrid model for the USPS, part business and part government service.
The USPS earns no profits, has no shareholders, is mandated by statute to provide universal service at reasonable set rates, is constrained as to how it can sell its products, and has received no taxpayer funds since 1982. The 1980s and ’90s saw growing conservative hostility to both universal service and postal unions that had won collective bargaining successes like the “no-layoff” clause for employees after six years of service. Even without the right to strike, postal workers enjoyed mediation and arbitration rights under the PRA. Nixon hated unions, but he accepted them as the price to be paid for high productivity and labor peace, especially after the 1970 strike.
Advocates for privatization gained serious traction with the 2002 discovery that the USPS had overfunded its Civil Service Retirement System payments to the US Department of the Treasury by as much as $71 billion. To reduce, transfer, or return those payments to the USPS would have created an unbalanced federal budget. Congress’s solution was the 2006 Postal Accountability and Enhancement Act that required the USPS to pay roughly $5.5 billion dollars a year for 10 years to prefund a Retirees Health Benefit Fund. This prefunding mandate has put the USPS in perpetual debt despite typically earning annual operational revenue surpluses between 1995 and 2018. Meanwhile, conservative pundits like George Will began to invoke a kind of “digital determinism” to explain the debt as proof of USPS obsolescence in the Cyber Age, part of what could be called “governance by gaslighting.”
In a sense the USPOD did operate “like a business” in its treatment of labor.
A half century after Nixon signed the PRA, President Donald Trump attacked the USPS as “a joke” and blocked a $10 billion loan earmarked for the USPS under the CARES Act unless the Postal Service increased parcel rates and granted Trump power to demand labor concessions and oversee senior appointments. Trump’s extreme hostility to the USPS fits with the long-standing conservative wish to privatize the USPS. That push to privatization is rooted in animosity toward both the public service provided by the USPS and postal labor as well.
Historian Richard John was correct when he pushed back against Trump’s tirade and explained that the founders intended the post office to be a public service, not a business. That has not changed over time. The USPOD (1775–1971) was America’s original political and information network, promoting newspapers, letter-writing, publishing, advertising, national development, and innovation. In a sense, though, the USPOD did operate “like a business” in its treatment of labor. For almost two centuries, the USPOD tried to reduce labor costs, imposed rigid work standards, and clashed with unions.
At the 1970 PRA signing ceremony, Nixon praised everyone involved in crafting that compromise bill, including the postal unions that rejected his idea of calling the USPS a corporation. If it seemed that Nixon was stealing from the Democratic playbook, it was because there was still that much left of the “liberal consensus” in 1970, not to mention the power of organized labor. The shared political assumptions of that time have changed, but the same issues endure of universal service, congressional oversight, cost management, agency autonomy, and guaranteed labor rights for 633,108 postal workers. However, today’s fraught political environment also includes an existential threat to an essential government infrastructure. To paraphrase Benjamin Franklin, the first United States postmaster general, the republic and its post office are both ours—if we can keep them.
Philip Rubio is professor of history at North Carolina A&T State University. He carried the mail from 1980–2000.
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