Burrus Journal

What is Congressman Issa waiting for?  After being informed that the USPS may run out of cash in October of this year he continues to dally with legislation that would stabilize postal finances.  It is obvious that Republican members on the committee object to key pieces of the proposed legislation, but there is too much at stake to hold out for a political agenda.  Union efforts to substitute H.R. 630 as the vehicle for postal reform are a wistful long shot so to continue as a viable institution it is essential that some form of legislation is adopted and soon.  The question before the major stakeholders is whether each will accept undesirable provisions to save the Postal Service and there is a laundry list of them.

For the unions, they want to avoid at all costs modification to collective bargaining; accelerated consolidations; 5-day delivery; release of retirement overfunding; major subcontracting, but eliminate the health care prefunding.

The Republican agenda seeks to continue the health care payment in some form, accelerate consolidations, reduce the retirement overpayment and lay the foundation for privatization.

Within these conflicting agendas and unflinching adversaries there is a possibility of legislation that does not satisfy the politicians or the unions but saves the Postal Service.  If one begins with the goal of an economically stable Postal Service as the primary objective, the legislative negatives while unacceptable become palatable.  The clock is ticking and the USPS’ financial position will not improve without major intervention. Neither camp will achieve their objectives in the current political climate, but at some point the question must be asked: postal reform or what?

Many postal employees are ambiguous to the continuing debate about the future of the Postal Service. They read sporadically the information provided by union and management and on occasion are exposed to canned messages by the postmaster general. In the middle of these messages that often conflict, there are basic undisputable facts about the mail volume that will dictate the Postal Service of tomorrow. Postal jobs are dependent upon mail volume and the following info graph puts into context the Postal Service of the present and of the future.

Source Credit: http://www.numbersleuth.org/trends/usps/

A Postal and Unique American Experience “MY JOURNEY” by William Burrus – Personally Autographed

Hard Cover $19.95 includes FREE SHIPPING

In addressing the serious financial losses by the Postal Service and the lack of political courage to permit 5 day delivery the Board of Governors arrived at the brilliant conclusion that the unions be requested to reopen negotiations.  The Mail Handlers have publicized their response to the USPS request and as expected, they politely declined.  The date of the Donahoe letter was April 16, 2013 and it can be expected that similar letters were mailed to the other unions.  There is no possible positive outcome for the unions to reopen negotiations which would certainly lead to arbitration so one can certainly assume that the other unions likewise declined the invitation.

For reasons of strategic planning, the other unions have not publicized their response or acknowledged receipt of the April 16 letter but employees have a right to know the content of the unions’ responses.  It is obvious that the purpose of such reopening would be to reduce wages and benefits of employees, and having already achieved major cuts for future employees’ attention would be turned to existing employees.  It must be assumed that these factors have been considered in the unions’ responses but it is the employee’s wages and benefits that would be in play and it has been almost one month since the Donahoe request.

The APWU silence on the Donahoe request exposes the naïve boast that they would correct in future negotiations the disparity in the pay scale that restricts new hires to a top step of J making APWU represented employees the lowest salaried employees in the Postal Service over the last 25 years of their careers.  The awards of all of the other unions extend the new pay scales to O and the disparity was dismissed as easily overcome in future rounds of negotiations.  The assumed APWU rejection to reopen negotiations is an indicator that the union is not anxious to expose the wages of senior employees in this effort and it can be expected that this dilemma will prevent any positive adjustment for years to come.  The simple fact is, in negotiations the union cannot trade a benefit in one round of negotiations and then recover it in subsequent negotiations.  The Postal Service would demand a return of the exchanged benefit in this for that bargaining.

A Postal and Unique American Experience “MY JOURNEY” by William Burrus – Personally Autographed

Hard Cover $19.95 includes FREE SHIPPING

The postmaster general has embarked on a massive plan to consolidate mail processing facilities that will result in over 200 plants being merged with continuing facilities. The relocations will impose major inconveniences on the reassigned employees and the communities that lose plants will experience delays in mail deliveries. Mail intended for delivery within the community or same block will travel one hundred miles or more round-trip before delivery. This erosion of customer service is bad enough at a time when citizens are opting increasingly to communicate by other means, but the entire process of plant consolidations is a hoax.

Mail processing in the American postal system consists of the 400 plus plants owned and operated by the Postal Service and 35 processing plants operated by Pitney Bowes. The 35 Pitney Bowes plants process the same mail finalized in postal plants for delivery, performing the service at a cost that is determined by law to equal avoided USPS costs. The law requires that the rates set for presorted services be at the USPS’ avoided costs, so by law the USPS’ savings realized by Pitney Bowes performing a processing function is equal to the postal cost avoided. The Postal Service does not generate any savings. When initiated in the 1970s it was intended that from a financial perspective there would be no gain and no loss with the only driving factor being “space.” This is a hoax because in the real world the Postal Service is providing an economic windfall to Pitney Bowes for a service that is duplicative and could be performed by postal employees.

When combining discounts with consolidations, there is a disconnect in maximizing revenue and the productivity of the postal network. The stated purpose of consolidations is to maximize the efficiencies of postal processing and save the costs of the consolidated plants with the underlying justification that there is an excess of USPS processing capacity. Yet, the 35 Pitney Bowes plants are not included in the processing model even though their costs are directly related. It is illogical to reduce processing capacity of the postal network while continuing the subsidy to Pitney Bowes’ plants under the justification that USPS cannot process 100% of the mail volume.
The two principles conflict, justifying presort because of the inability of the Postal Service to process the reduced volume and continuing the presort relationship with Pitney Bowes. Because of alleged volume exceeding USPS capacity, this is a hoax beyond reasonable logic. It can only be assumed that there is more at play than generating savings from consolidations. The postmaster general has put his thumb on the scale in favor of presorting and postage discounts.

Pitney Bowes announces that 14 billion mail pieces are subjected to the discounted rates and every penny of revenue generated in mail processing for Pitney Bowes is a direct loss by the Postal Service. The relationship is so absurd that the Inspector General and the Attorney General should conduct investigations to determine if there is personal gain. It is painfully obvious that if there is excess capacity in the USPS’ processing network the alternate processing performed by Pitney Bowes is duplicative and should be discontinued.

The only alternative conclusion is that the American public that pays full undiscounted rates is being taxed beyond postal costs to provide profits for Pitney Bowes. This is illegal.

The Postal Board of Governors has directed the postmaster general to continue 6-day delivery for all mail.  The Board also arrived at the brilliant conclusion to request that the labor unions agree to reopen negotiations to reduce cost. They have the right to continue 6-day delivery, but reopening negotiations is wishful thinking. Having failed to save the purported two billion dollars from reducing the days of delivery, an official letter to the unions “requesting” the reopening of negotiations will be marked “return to sender.” None of the postal unions will be receptive to reopening negotiations that can only lead to arbitration. Despite the APWU original objective of “saving” the Postal Service, there is no appetite to reopen negotiations to discuss reducing employee wages and benefits equal to a two billion dollar savings as expected from 5-day delivery. You cannot achieve savings of this magnitude on the backs of future employees on top of the changes agreed to in 2011.

The minimum wage laws create a floor beneath which the union cannot go even if they would be tempted to sell out the next generation even more. Cutting the salaries of existing employees is where the rubber meets the road and it is their wages and benefits that would be the subject of any renewed contract negotiations.  With the new APWU wage scale, the value of postal work has been established at top salary for Grade 6 at $42,000 per year, a reduction of $11,000 per employee.  I challenge the supporters of the existing contract to pledge their support for equal cuts for themselves and current employees in reopened negotiations. I would suggest that Donahoe save the postage on any request to reopen negotiations. If he really needs to save two billion dollars per year, a viable alternative is to eliminate discounts; that would certainly do it.

A Postal and Unique American Experience “MY JOURNEY” by William Burrus

Hard Cover $19.95 includes FREE SHIPPING

What is Congressman Issa waiting for? A review of the financial status of the Postal Service reveals a balance sheet that must be improved if it is intended to have nationwide service long term. They can limp from quarter to quarter, but a $60 billion a year institution needs a new start. Draft legislation has been on Issa’s desk for two years and he has failed to move it out of Committee. It is obvious that he does not have the votes for the specifics in his draft but is that what democracy is about, his way or no way? Other Democratic members of the Committee have offered their versions but he refuses to let the democratic process work. Is he afraid that reform will actually improve the Postal Service?

PMG Donahoe attempted to call his bluff by announcing the implementation of 5-day delivery without legislation. The move has shifted the debate from reform to the authority to arbitrarily initiate 5 day but that hasn’t resulted in the Bill being called up and voted on. It is time for pressure.

The issues have been fully vetted, why not let Congress vote? The unions missed the mark in focusing exclusively on encouraging members to contact their representatives and demonstrating around buildings. After two years of publicity, the unions either have a working majority or they won’t get one. It is not the public or local representatives who are holding up legislation. They cannot vote until the Bill is called up by the Chairman. This is a one man show and the Chairman is calling the shots. What is needed? Perhaps, one thousand postal employees and their families, parked out front at his home and each of the offices in his District. American citizens must be informed that this single individual holds the future of postal services in his hands. We will never get to the issues of reform including:

• The health care payment
• Refund of the retirement overpayment
• Modification of the authority of the Rate Commission to set rates to meet service needs
• Consolidations
• 5-day delivery

There will not be meaningful debate and votes on the issues of reform until Chairman Issa elects to bring them to the floor and only then can the Lynch Bill and other alternatives get a vote.

There must be logic behind the delay, but what is certain is that it is not in the interest of postal employees or the public that relies on mail services. Chairman Issue is pursuing a limited political objective and it is obvious that he does not intend to move. The Republicans are in the majority on the Committee and they do not want to cast a vote that can be used against them in the 2014 midterm elections. The future of postal reform is not a question of convincing those friendly in Congress to vote the right way. At this stage, it’s about getting a vote and Issa is the key.

The Pitney Bowes proposal to privatize all postal services except delivery is so ridiculous that it should be flatly rejected as a serious effort to address the USPS’s financial difficulties.  In an effort to satisfy the demands of panel member George Gould to exempt the letter carriers, his former employer, they settle on this cockeyed idea of continuing government mail delivery and contracting out the rest.   To the average user of postal services, this suggestion may seem reasonable but anyone who is familiar with the functions involved from the collection box to the home cannot imagine how the function of delivery can be spun off and be a totally independent service; the questions are endless.

The document that has charitably been referred to as a “white paper” did not even attempt to answer the obvious questions and had as its basic intent to put the issue of privatization in play.  We have this ongoing debate about the inability of the public sector to operate efficiently so if one intends to be taken seriously about the superiority of the private sector  over government services or to make a fair comparison you must start with a level playing field which means that the private postal entity would be required to pre fund billions of dollars in future health care cost; overpay the retirement fund; be subjected to government authority on health care for active employees; give veterans priority in employment; give local government a forum to interfere in the functioning of postal facilities; fix limitations on rate increases for the privatized services, and on and on.

Without addressing the issues that would level the playing field, this proposal would break new ground, creating a public/private partnership that has never been successfully tried under our form of government and is not deserving of serious consideration.  The only way that it could work is to require huge subsidies from the federal government which are not required under the present system.  Congress should not be distracted from the serious business of correcting previous efforts of reform including:

1. The rate schedule and artificial limitations
2. Limitations on use of the network for commercial purposes
3. Overpayment into the retirement fund
4. Rate discounts for activities that add to postal costs
5. Limiting autonomy in operational decisions
6. Imposing unique health care funding for active and retired

Time is running out on opportunities for Congress to fix its past mistakes in reforming the Postal Service.  Each of the impediments to postal financial stability was previously imposed by legislation called reform so all that is needed is to undue previous mistakes.  The very last thing that needs to be considered is a public/private partnership.

A Postal and Unique American Experience “MY JOURNEY” by William Burrus

On Sunday, I joined in the national picket and rally held to preserve six-day delivery. Presidents Ken Lerch NALC and Tom Dodge of the APWU forwarded an invitation that I gladly accepted. The rally was held at the Gaithersburg Mail Facility in Suburban Maryland. It was attended by more than 100 activists protesting five day delivery, consolidations and denial of service for rural offices. I was honored as a speaker and expressed my support for their cause. I reminded the participants that 43 years ago on March 24, 1970, two hundred thousand postal employees were concluding their seven day strike that culminated in an independent Postal Service; significant pay increases; collective bargaining rights, and amnesty. The numbers of veterans of the 1970 strike are dwindling as active employees but the struggle continues.

Among others joining me as speakers at the rally were dear friends, Dena Briscoe,  President, Nations’ Capital APWU Local, Nanette Corley, President, Montgomery County APWU Local, and Josh Williams, President of Metropolitan Washington  AFL-CIO Council – all of whom brought solidarity from their membership. It was cold, but festive and the voices of the participants were loud and clear “5 Day – No Way.”

President Ken Lerch of the NALC is commended for his leadership in organizing the event. In private conversation, I was exposed to the heart and soul of the labor movement, leaders at the grass roots level.

A Postal and Unique American Experience “MY JOURNEY” by William Burrus

As I predicted, the National Academy of Public Administration, a think tank sponsored by Pitney Bowes concluded that “the Postal Service should consider keeping door-to-door delivery while privatizing the rest of its operations.”  Halleluiah, the skies have opened and wisdom has been shared with the masses.  It is only coincidental that Pitney Bowes which does $30 million in business annually through the post office and operates 41 processing plants would be a major bidder for the extension of its postal network and what is good for Pitney Bowes stockholders is good for America.  I am kidding of course; this paper released by paid spokesman for large mailers could be expected to be in the interest of large mailers.

David Walker, former head of the Government Accountability Office has never been a fan of the Postal Service and was a strong supporter of the 2006 PAE and its disastrous impact on USPS finances; George Gould, former legislative director of NALC was a coconspirator.  Any product on postal matters bearing their signatures must be suspect given their recent track record.  But maybe there is logic to their behavior.  First, they advocate saddling the USPS with $55 billion in artificial debt under the guise of future health care payments and then they use the resulting financial deficit as justification for privatization.   One must ask if the original goal in the 2006 PAEA was a 2013 privatization proposal or do I give them too much credit for advance planning?

Conspicuously absent from the paper is a proposal  that the private entity assuming postal activities will inherit this $55 billion future health care liability with required payments of five billion dollars plus each  year over an 11 year period.  The paper is also silent on discounts or will the new entity be permitted to charge fixed rates for each class of mail?  What about local, state and federal taxes?

This paper is no more than a capitalist dream of hijacking a national service for private profit.  They would buy the postal network at firestorm discount and added to the cost of service would be shareholder profits achieved through reduced employee wages and benefits.  In the interim, the privatization proposals would  remove all of the obstacles to a financially stable postal service, including future health care payments, rate discounts, restrictions on adjusting rates, use of the network, offering competitive services and a host of government sanctioned limitations that restrict USPS initiatives.  I expected no less from David Walker who was never a friend of the postal service and whose only contribution at public forums was displaying his cell phone as evidence that mail was in decline.  But George Gould collected pay checks from employee wages and one has reason to expect that he would not sell out completely.

This report has no credibility and should not be taken seriously in addressing the changes occurring in the communications industry and postal finances.

One can expect that legislators who do not believe in public service will quote liberally from this report as justification to deny positive reform that will sustain the Postal Service in a changing environment.  But the authors of the report have no credibility and their product should be discarded to the bins of irrelevancy.

A Postal and Unique American Experience “MY JOURNEY” by William Burrus 

Randy Zelznick is commended for posting the Postal Museum event honoring the 40^th anniversary of the1970 postal strike.  It is exceptional that a video and verbal record has been distributed recording the only successful labor strike of the US government by participants of the strike.   Unfortunately, similar footage does not exist for other moments of labor history. Vince is now deceased, but fortunately his testimony has not been lost.  As time progresses, details of the strike will be lost or distorted with memory but the video will exist forever.

I was privileged to be a member of the panel with Vince and George Gould to share what happened, the contributing factors and the outcome.  I will treasure the video and the fact that it will be viewed hundreds of years from now.

Postal activists who desire the true history of the strike are advised to burn a copy and use it as a training tool to tell future generations that these were participants of the strike that changed history.

When the dust settles, the Postal Service will have reduced the employee complement from over one million employees to around 500,000, and falling. This will be a reduction of one half million good paying jobs with benefits, including health care and retirement. This is not the fault of any specific union administration but the impact of technology and computer staffing and scheduling that has occurred over a 40 year period. The initial transformation from manual sortation has evolved over time and with technology two employees can now equal the production of 20 employees in the past. The introduction of technologies has similarly affected numerous other industries, including auto, steel, coal and other manual occupations. These occupations have been the backbone of the labor movement and their diminishment has mirrored the reduction in union density. Any future resurgence will require a major shift in objectives.

As civilization progresses and it will, the response by workers must be with increased union density that the new technologies generate equal job opportunities, wages and benefits. Over the past decades of reduced postal complement, communications have magnified but the increased communications have gravitated to other forms.  People communicate many times more in 2013 than they did 50 years ago but the union employees facilitating those communications have been reduced dramatically. Go to any public gathering and observe how many people are communicating as compared to 40 years ago when such exchanges were limited to a land line phone and mail. Communications have grown while the number of postal and telephone workers has declined.

The unions of tomorrow must have a vision beyond the specific activity performed by specific workers and focus on the broader activity.   Over time, most of the functions that we engage in will be performed more efficiently with computer related efficiencies. Mail is merely a means of communicating and while hard copy will continue far into the future, its share of the market will progressively diminish as a share of the total exchanges.

Discussions within the union among the technicians, stewards and officers’ focus on problems of the moment, the resolution of issues of today, but long range focus must receive equal attention. Seniority grievances or other issues of contract enforcement pale in comparison to the structure of the communication industry 10 years from now.  An APWU of 80,000 members cannot and will not represent as effectively.

Some will suggest that in an effort to broaden the base, the union chase the remaining segments of hard copy processing and delivery but those segments will also in time fall victim to technology. There will not be sufficient numbers of manual activities remaining in total to return to the pre computer complements so focus must expand beyond the specific tasks now performed.

Andy Stern, former president of SEIU, had a vision of segmenting unions along functional lines, but became frustrated in convincing fellow union presidents and withdrew from the AFL to form a separate entity that has floundered and failed to pursue his vision. The mindset of union officials must expand beyond the narrow confines of activities that will not survive the innovative changes of the future. It can be expected that there will be resistance because the issues of the day are here and now and demand attention but there is no alternative. Union memberships that rely on physical activity that can be modified by technology will continue to suffer losses similar to the Postal Service and APWU. We must do more than fight yesterday’s battles because technology is eating our lunch.

We tried in the late 1980s to address the impact of technology with the organization and retreat of all national officers to the Greenbrier Resort in West Virginia.  The agenda was to look into the future and project changes necessary to remain viable as a labor union.  The union mindset at the time, as now, was contract interpretation and enforcement and we were unsuccessful in changing the focus even though we invited the postmaster general, President AFL and other decision makers who knew the future plans of employment.  We did succeed in establishing a ‘Committee of The Future’ that met periodically over the following years but we were unable to change the focus from now, today, to tomorrow.  From that period forward, we have ridden the horse of representation to the point of continuous erosion and the result has been a membership base that has dwindled from 300,000 to 150,000 and dropping.

There will be cries for worker solidarity to stop change but there is not sufficient appetite for revolution and a revolution for what? To do what, put workers in charge to stop change? Such a strategy is doomed to failure because change will happen and those ill prepared will suffer the consequences. With its ever expanding officer and staff structure, APWU has baked into its future tens of millions of dollars in legacy costs factored on a membership base of 200,000 members so there is no alternative except to shape the future. Restructuring at this late date will not relieve the vesting obligations to retired and eligible recipients.  Exclusively focusing on the problem of the day will not leave time for preparation for tomorrow, and tomorrow will come. It’s just a matter of time.

History repeats itself as ten years ago almost to the date, I summarized the union’s plans in the fight over the consolidation of postal facilities.  Following is an excerpt from the APWU magazine over the byline of the president outlining the challenges facing the union and plans to confront them.

March/April 2003 

This was the struggle 10 years ago and it is repeated today.

On Friday, March 1, I had the privilege and honor to be a featured speaker at the retirement event for Tony Vegliante, Vice President USPS’ Labor Relations. Over the course of my career as an advocate for postal employees, I obviously had disagreements with Tony for postal policies detrimental to my cause. Nevertheless, over the course of almost 30 years, I succeeded in making significant positive changes for postal employees and to achieve change, I needed a partner (Tony Vegliante) in postal management. The list of changes that we initiated positively affecting employees is lengthy including elevating salaries from $17,000 when I assumed national office to $55,000 when I retired.

Together, we increased the difference between the lowest paid employees, Custodians, and the highest paid ETs from $10,000 to more than $30,000, providing an incentive for employees to gain new skills. We installed air conditioning in all vehicles and increased the drivers from Grade 5 and 6 to Grades 7 and 8. We eliminated all PTFs in offices; restricted the use of casuals; changed the promotional system so that employees would always receive more after being promoted; redesigned the keying operations in BMCs; designed a smoking policy, and permitted Locals to control their grievance procedure. These and scores of other positive changes were made with the concurrence of postal management and my constant partner was Tony Vegliante.

As representatives of labor and management we were natural adversaries but Tony and I represented our constituents with respect. The most respected trait in a management official is that he/she is true to their word and I could trust his commitment. We applied the labor management’s relationship to the most significant changes in the history of the Postal Service. From manual distribution to mechanical to automation to computer controlled, we eliminated smoking in postal facilities; created rules for the transition of replacing nearly every mail processing facility, and we changed the basic relationship between employees and management.

Over the course of the relationship we had our disagreements, but we elevated postal employment. In Tony, I had a partner to explore new and innovative ways to continue the USPS as the most efficient and cheapest postal service in the world while making postal employment a destination for careers. On behalf of the millions of postal employees and their families that were impacted from these decisions, I expressed appreciation and wished him well in any future endeavor.