The outgoing US Postmaster General Louis DeJoy recently signed a letter with the U.S. Digital Service, often referred to informally as the “DOGE” Service, to allow them to review their internal files, systems, and information as a way to improve efficiencies.
The U.S. Postal Service has been an ongoing fiscal disaster zone since the 1980s. Chronic mismanagement and bad leadership has brought it to the point where it is operating with a $73 billion annual budget and still coming up $9 billion short every year, existing by virtue of an annual bailout from Congress.
The USPS has been a focus point for fiscal failure: Biden was trying to spend $3 billion on EV vehicles for the Post Office, an order cancelled by Trump and Musk already.
But as Musk’s team gains access to the postal service’s internal files, the public policy recommendations could potentially greatly improve the service, or spiral it into even more billions in debt since it is the nation’s largest civilian employer. As of 2023, the United States Postal Service (USPS) employed approximately 525,469 career employees.
The Postmaster has agreed with Musk to cut 10,000 of those employees as a cost-savings measure.
Previous efforts by the USPS to reform itself were widely seen as total failures.
Left-wing policy advocates are typically interested in two USPS reforms, which are primarily accounting gimmicks: they want to stop the forced pre-payment of pension liabilities for the postal service, and they want to force postal retirees to enroll in Medicare.
The first policy would save the Postal Service the annual costs, while shifting costs to the federal government in the future.
Ending the USPS pre-payment of pension obligations would create serious financial risks by shifting future retiree costs onto taxpayers, likely leading to taxpayer-funded bailouts when the USPS faces pension shortfalls. Without pre-funding, the USPS would accumulate unfunded liabilities, making it difficult to cover pension and healthcare costs as its workforce retires. This pay-as-you-go approach is fiscally unsustainable, widening the gap between pension obligations and revenue over time. Additionally, eliminating pre-funding undermines financial responsibility, setting a dangerous precedent that could encourage other agencies and businesses to neglect long-term obligations. Pre-funding also ensures financial transparency, preventing the USPS from masking its true debt by pushing liabilities onto future administrations. Instead of eliminating pre-funding, a more responsible approach would be pension reform that balances cost reductions with financial sustainability to secure long-term solvency without relying on future bailouts.
The second policy would simply shift the retirees onto the public Medicare program, as a way of shifting the costs onto the general federal budget.
Medicare is a federal health insurance program in the United States primarily for individuals 65 and older, as well as certain younger people with disabilities and those with end-stage renal disease (ESRD). It is divided into four parts: Part A (hospital insurance) covers inpatient care, Part B (medical insurance) covers outpatient services, Part C (Medicare Advantage) allows private insurance plans to offer Medicare benefits, and Part D (prescription drug coverage) helps cover medication costs. Medicare is funded through payroll taxes, premiums, and general revenue, but beneficiaries often pay out-of-pocket costs such as deductibles, copayments, and premiums depending on the plan.
In fiscal year 2023, the federal government spent approximately $848.2 billion on Medicare, accounting for 14% of total federal spending.This amount averages approximately $15,727 per Medicare beneficiary annually.
These two cost-shifting policy ‘reforms’ would largely preserve the current post office management and operations which, many claim, are the real root causes for its fiscal failures and an ongoing deterioration in the quality of the nation’s mail service.
Congress has previously considered the left-wing policy ideas that would simply engage in cost-shifting to other parts of the federal budget, but over the decades a variety of free market and right-leaning reforms have been developed that would potentially reduce costs while improving quality.
So far President Trump and DOGE advisor Elon Musk have primarily engaged in cutting contracts and ending the employment of federal bureaucrats. Long-time government reform advocates suggest that greater challenges lie ahead as Trump and team attempt to fundamentally reshape how the government operates, upending decades of systems put in place by left-wing technocrats.
One major push system reformers have long advocated has been finding a way to end the USPS’s monopoly on first-class mail.
Ending the USPS monopoly on first-class mail would, supporters say, introduce market competition, driving efficiency, innovation, and cost reductions in mail delivery. Currently, the USPS has exclusive rights to deliver first-class and standard mail, shielding it from competition and enabling inefficiencies, financial mismanagement, and service delays. Allowing private companies like FedEx, UPS, and emerging logistics startups to compete in this space would create price incentives, improve service quality, and encourage technological advancements in mail processing and delivery.
Free-market advocates have long proposed privatizing the USPS, arguing that transforming it from a government agency into a private entity would significantly improve efficiency, service quality, and financial stability. Countries such as Germany, the Netherlands, and Sweden have successfully privatized their postal services, allowing them to operate with greater flexibility while reducing government financial burdens. By moving away from government control, the USPS could better adjust to market conditions, set competitive pricing, and invest in modernization efforts without requiring congressional approval.
Cost-cutting measures such as consolidating mail processing centers, reducing underutilized post office locations, and streamlining delivery routes could help the agency operate more efficiently. Adjusting delivery schedules, such as moving to fewer days of mail delivery while maintaining package services, could further reduce costs. Advocates of restructuring argue that these changes could help bring the USPS closer to financial stability without requiring taxpayer bailouts, while still ensuring that mail service remains accessible to all Americans.
Right now, USPS critics claim, its routes and operations are set by politicians to serve political interests rather than true market interests.
One mailhouse operator who regularly sends out 4 million pieces of mail annually, told the Gateway Pundit that the major problem with the Post Office is simply the quality of its staff:
“The post office is the original DEI employer, and they have layers and layers of bureaucracy that create problems, not solutions,” the mail vendor explained. “We’re talking completely incompetent people who make all of their systems inefficient. They typically put the smarter folks into their commercial bulk mail operations, which is their financial bread and butter. But the other folks in the USPS’s employment are just awful.”
The mail vendor continued, “There are never any guarantees with the post office as to when a letter is going to arrive, no matter what they tell you, or what rate you pay for. Their standard bulk mail letter is supposed to get to its destination within 10 days, but that entirely depends on the quality of the staff at their sorting facilities. They simply raise prices and cut staff as a response to their own failures. Musk has his job cut out for him, because the post office is filled with political and diversity hires. The entire place needs to be overhauled.”
The effort to reform and improve the operations of, and fiscal bottom line of, the nation’s postal services has been ongoing since at least the 1980s.
James C. Miller III, an economist and advocate for free-market policies, played a significant role in efforts promoting the privatization of the United States Postal Service (USPS) during the 1990s. In 1988, as Director of the Office of Management and Budget under President Reagan, Miller headlined an event titled “Privatization and the Postal Monopoly,” where he urged competition in mail delivery. By 2001, while serving as a director of Citizens for a Sound Economy he chaired discussions at the CATO Institute advocating for USPS privatization, contributing to the publication “Mail at the Millennium: Will the Postal Service Go Private?”
Miller spoke with the Gateway Pundit and shared these observations about fighting for Postal System reform for nearly 40 years:
“It’s about time the USPS was fully integrated into the complex American economy, and they lost the subsidies that are leading it into problems. With all the other changes being planned right now, now is the time to do this work and I’m excited that President Trump and Elon Musk are up to the challenge.”
Miller continued, “The current Postmaster, DeJoy, did the best with a bad situation. But there are deep-seated structural problems at the post office. The unions are very powerful over Congress, and the USPS cannot be efficient, or implement real innovations, as long as they are under federal political control.”
“One talking point that’s used is that the Constitution requires a postal service, which is simply not true,” Miller said. “The Constitution authorizes a postal service, but does not mandate one. America can and should have a private sector postal service. But it will ultimately end up as a fight between Trump and Congress, as the unions have great power here. Their power is not just in their bargaining agreement, but mainly in how they pressure and lobby Congress. Right now, first class mail largely subsidizes the rest of the system, and there are a lot of very fine people who work at the postal service who are trying to make up for the mistakes of many of their other wasteful employees. They employ far too many people. And so while even though total mail is going down, measured as through-puts, and the whole rationale for the system has disappeared, very little has changed with the postal service.”
“The time is now for major change to the postal service, and this is an exciting time for the future of America.”
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