September 20, 2017

Pay no attention to the man behind the curtain trying to scare you with a 20% postage increase

The Associated Press recently took a typical Capitol Hill persuasion tactic—big postage increases if Congress fails to act—and made it sound like a real possibility. Some of the articles that this unfortunate “news” reporting generated are linked in our Alliance notes section today.

The number apparently came from claims put out by an “industry” coalition pushing the latest version of postal “reform” legislation. It has little to do with reality. Both the Postal Service and a member of the coalition confirmed that we should not take anything near 20 percent seriously.

The “need” for such large postage increases comes from beyond-worst-case scenario projections of postal liabilities based on faulty and exaggerated assumptions about future retirees, future costs, low investment rates, and more. Most important, they make the false and dangerous assumption that very long-term issues must be fixed overnight. And of course, large rate increase will not fix anything.