“The Decision Part II” might not be nationally televised as last night’s LeBron Jamesathon was on ESPN.
But “The Decision” resting on the shoulders of the Postal Regulatory Commission on Oct. 4 could very well send shock waves throughout the multichannel merchant world.
Catalogers would receive a 5.1% increase in postage if the U.S. Postal Service’s proposed exigency rate case is approved by the PRC. The USPS is in a horrible financial state, losing billions of dollars a year, with five-day delivery a distinct possibility.
If Congress waives the Postal Service’s annual $5.5 billion payment for retiree health benefits before its scheduled Sept. 30 adjournment, Steve Kearney, senior vice president, customer relations for USPS, has said withdrawing the exigent rate case “might be something to consider.”
The backlash against this exigent rate case was strong and immediate. Many industry experts questioned the legality of it in March when it was first announced by the USPS.
Jim Cregan, executive vice president of government affairs for the Magazine Publishers of America, and member of the newly formed Affordable Mail Alliance, said if the PRC approves the rate case, the USPS would “accelerate its own death spiral just when the industry and the economy are beginning to get up off the floor. It’s bad for all concerned.”
Jerry Cerasale, senior vice president of government affairs for the Direct Marketing Association and member of the Affordable Mail Alliance, said there is a legal CPI cap on postage rates and the “USPS wants to break that cap and by 10 times the rate of inflation.” Cerasale said a “reasonable” increase would be at or below the cap, which is less than 1%.
Most detractors don’t believe the USPS has done enough internally with excess capacity, and taking a hard look at management positions.
What the USPS calls “moderate and reasonable” increases, those on the other side call short-sighted and unreasonable.
PRC Chairman Ruth Goldway became the head of that panel less than a year ago and now she and her colleagues face a “decision” that will receive thorough scrutiny during the 90-day process, and one that will affect millions of merchants throughout the U.S.
Come Oct. 4, Goldway might not have booked the Boys & Girls Club in Greenwich, CT, Jim Gray might not be sitting in a chair ready to interview her live on ESPN, and media outlets might not be following this story around the clock from mid-September on, but rest assured the PRC will be in the spotlight as millions of mailers across the country will be anxiously awaiting its “Decision.”
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