Bloomberg Businessweek (Asia)

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”

- Devin Leonard

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.”

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