The Se­nate fails to de­liver for the USPS

The USPS has eight open seats on its board, thanks to Se­nate pol­i­tics “Senator San­ders thinks no board is bet­ter than a bad board”

Bloomberg Businessweek (Europe) - - CONTENTS - Devin Leonard Edited by Al­li­son Hoff­man Bloomberg.com

Af­ter a decade on the U.S. Postal Ser­vice Board of Gov­er­nors, James Bil­bray is ready to go. “I turned 78 on May 19,” says Bil­bray, the board’s chair­man. “I’m get­ting old. I’m get­ting tired.” Yet Bil­bray, whose term was ex­tended af­ter it ex­pired last De­cem­ber, fears he’ll leave a vac­uum at the USPS. The U.S. Se­nate has re­fused to con­firm any of President Obama’s ap­pointees to the Board of Gov­er­nors since 2010.

The board, which is sup­posed to have 11 mem­bers, cur­rently has only three: Post­mas­ter General Me­gan Bren­nan; her deputy, Ron­ald Stro­man; and Bil­bray, a for­mer Demo­cratic con­gress­man from Ne­vada who was ap­pointed by Ge­orge W. Bush. Un­less some­thing changes, there will be only two at the year’s end, when Bil­bray’s ex­ten­sion is up.

The USPS Board of Gov­er­nors may seem like an­other non­de­script over­sight body in Washington made up of lawyers, ex-politi­cians, and busi­ness­peo­ple with a sur­plus of free time. But the board, whose mem­bers earn a $30,000 an­nual salary, keeps watch over the world’s largest postal ser­vice, which made $69 bil­lion in revenue last year, although it strug­gled with a $5 bil­lion deficit. That was be­cause of a legally man­dated obli­ga­tion to set aside money for the health­care ben­e­fits of its fu­ture re­tirees. It’s seen 28 per­cent of its vol­ume van­ish in the past decade but still de­liv­ered 154 bil­lion pieces of mail last year.

Obama tried to rem­edy the sit­u­a­tion by nom­i­nat­ing five peo­ple to the USPS board in 2015. Two were Repub­li­cans: James Miller, Ron­ald Rea­gan’s direc­tor of the Office of Management and Budget; and Mickey Bar­nett, a for­mer Repub­li­can state senator from New Mex­ico. Obama also named three Democrats: Stephen Craw­ford, a pro­fes­sor at Ge­orge Washington Univer­sity; David Ben­nett, a for­mer aero­space executive; and David Shapira, chair­man of the Gi­ant Ea­gle su­per­mar­ket chain.

The Se­nate has yet to vote, be­cause there are holds on the nom­i­na­tions. Typ­i­cally, sen­a­tors don’t dis­cuss such back­room ma­neu­vers, but in this case one has: Ver­mont Senator Bernie San­ders. Ac­cord­ing to his se­nior policy adviser, Warren Gun­nels, San­ders is block­ing the two Repub­li­cans—Miller be­cause he wants to pri­va­tize the Postal Ser­vice, and Bar­nett be­cause of his ties to the pay­day loan in­dus­try. San­ders is also op­posed to Craw­ford, who’s pro­posed cut­ting home de­liv­ery and in­stead al­low­ing peo­ple to re­ceive scanned copies of their let­ters elec­tron­i­cally, as they do in Switzer­land.

By putting a hold on three ap­pointees, San­ders pre­vents all five from

be­ing con­firmed, be­cause the Repub­li­cans who con­trol the Se­nate will hold a vote only on all five as a pack­age. “Senator San­ders thinks no board is bet­ter than a bad board,” Gun­nels says. It’s a po­si­tion shared by the Amer­i­can Postal Work­ers Union, which has en­dorsed San­ders’s presidential run. “The APWU has been very dis­sat­is­fied with the nom­i­nees that have come out of the White House,” says Mark Di­mond­stein, the union’s president.

Be­fore it lost its six-mem­ber quo­rum in late 2014, the board created what it calls a “tem­po­rary emer­gency com­mit­tee” com­pris­ing the re­main­ing mem­bers to ap­prove the USPS’s spend­ing and other ma­jor policy de­ci­sions. It’s un­clear whether the com­mit­tee will still be em­pow­ered to do so when Bil­bray leaves. “Ac­cord­ing to our le­gal opin­ion, you have to have one gov­er­nor ap­pointed by the president and con­firmed by the Se­nate,” Bil­bray says. A USPS spokesman dis­putes this, say­ing the com­mit­tee can con­tinue to func­tion even if its only mem­bers are the post­mas­ter general and her deputy.

Bil­bray says he’s skep­ti­cal of ru­mors that San­ders may with­draw his hold af­ter the Demo­cratic National Con­ven­tion in July. Ac­cord­ing to Bil­bray, San­ders told him he wouldn’t re­lent un­til the USPS re­opens 141 mail pro­cess­ing plants that it’s ei­ther closed or con­sol­i­dated in re­cent years to save money. “Bernie wants us to go back and re­open all those mail pro­cess­ing cen­ters—even the ones we’ve leased,” Bil­bray says. “It would cost us around $2 bil­lion.” Gun­nels says San­ders doesn’t want all the plants re­opened, but he def­i­nitely wants some of them up and run­ning.

What hap­pens next year when a new president is sworn in? Whether it’s Hil­lary Clinton or Don­ald Trump, there’s likely to be more grid­lock. Even if San­ders with­draws his ob­jec­tions, Bil­bray says, the unions have told him there are other sen­a­tors will­ing to tie up the ap­point­ment process in­def­i­nitely. “That’s why we’re up a creek.” The bot­tom line The last presidential ap­pointee on the USPS Board of Gov­er­nors re­tires in De­cem­ber, and there’s lit­tle prospect of re­plac­ing him.

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