If the federal government were a business, it would have filed for bankruptcy and shut down a long time ago. Think deficits. Imagine running the U.S. military as a profit-making corporation. What’s the revenue model? Plunder? Land grabs? Looting conquered territories? Extracting tribute from subjugated nations? How about the Department of Justice? Confiscating property? Fining anyone they can extort via criminal prosecution threats to generate as much money as possible? How about ICE? Letting them shake down undocumented border crossers under a theory that if these aspirants can afford to pay a bribe, they might make economic sense when they cross? Drug smugglers be on alert!
The reality is clear. Government is not a business, does not run in accordance with business rules and is not driven by a profit motive. Revenues are generated by taxes and fees… and extensive borrowings when Congress deems that necessary. And if a governmental agency is subject to Congressional oversight – versus a board of director elected by stakeholders with a unique ownership in the relevant entity (not: every American citizen!!!) – it is even farther removed from the profit and loss rules that apply to private enterprise. Today’s blog is focused on how the American tradition of patronage appointments to key federal positions has once again led to the rise of a rather ignorant and arrogant Republican fund-raiser to a position for which he is uniquely unqualified, the Betsy DeVos equivalent Postmaster General (a Trump era appointment holdover). Louis DeJoy.
DeJoy is a graduate of Central Florida’s Stetson University, where he secured a degree in accounting before becoming a CPA. He moved into the logistics/freight hauling industry where, through a series of acquisitions, he both rose to CEO and made a resultant fortune in his stock appreciation. He has been a mainstay in GOP fund raising, a success which was rewarded accordingly… with more than a big question marks along the way: “DeJoy has served as a major donor and fundraiser for a number of high-profile Republican Party politicians. He helped fund President George W. Bush's 2004 re-election campaign, co-chaired Rudolph Giuliani's North Carolina fundraising campaign in 2008, and donated a combined $27,700 to Jeb Bush's 2016 presidential campaign. He donated $1.2 million each to Donald Trump's 2020 campaign, and to the Republican Party since 2016.
“In April 2017, DeJoy was named one of three deputy finance chairmen of the Republican National Committee, along with Trump's then-lawyer Michael Cohen and the venture capitalist Elliott Broidy. In May 2019, DeJoy became local finance chairman for the 2020 Republican National Convention, then planned for Charlotte, North Carolina. [It was moved when NC would not entertain such a big event during the pandemic.]
“In September 2020 The Washington Post and The New York Times reported that according to former employees at DeJoy's logistics company New Breed, he participated in a straw donor scheme, reimbursing employees for making political donations. Employees, particularly managers, were expected to contribute to fundraisers for Republican candidates and organizations; they would then be reimbursed in full through the company's system of bonuses. Campaign finance records show that employees at New Breed gave substantial sums to Republican candidates and negligible amounts to Democrats. Between 2000 and 2014, when New Breed was sold, 124 employees gave a combined total over $1 million. Many of these people had not donated before they worked at the company and have not done so since leaving. Pressuring employees to make campaign donations, reimbursements for such donations, and use of corporate money to support individual politicians are in violation of both North Carolina and federal election laws, although some statutes of limitations may have expired.[18] At an August congressional hearing DeJoy emphatically denied having engaged in such practices. The House Committee on Oversight and Reform has opened an investigation into the allegations and the possibility that DeJoy lied to the committee, and has called for the Postal Service to suspend him. North Carolina Attorney General Josh Stein said that reimbursing someone for a political contribution would be a violation of state law and that ‘Any allegation that’s this serious merits investigation.’” Wikipedia
Nonetheless, Trump’s U.S. Postal Service Board of Governors appointed DeJoy to his Postmaster Post (confirmed by the Senate) in May of last year. At the time, then-President Trump was beginning to rail against all forms of vote-by-mail, since this enabled voters with less access to the polls, generally minority voters who trended Democrat, and DeJoy was his ticket to disemboweling the USPS, potentially delaying the receipt of mailed-in votes past the deadline where they would be counted. The rubric was that DeJoy was going to run the Postal Service like a business, cutting back where simple business principles would apply to a for-profit company in the private sector. Mailboxes were removed (thus requiring fewer pick-ups/personnel), delays of postal trucks – even for very good reasons – forbidden. Expensive but efficient automated sorters were taken off-line. Delivery schedules allowed delays. Congressional subcommittees bristled. DeJoy was forced to back off… a bit.
One of the federal government’s earliest creations (founded on July 26, 1775), the U.S. Postal Services was never intended to run like a business. But DeJoy, who is still in office until the Biden board of governors inevitably ousts him, is acting as if he has an immutable tenure, that he will be in charge for the foreseeable future. His vision remains immutably distorted. Michael Hiltzik, writing an OpEd for the March 29th Los Angeles Times, explains: “The 10-year master plan for the U.S. Postal Service unveiled Tuesday by Postmaster General Louis DeJoy looks as though it will achieve his objective of placing the service on a sound business footing for a decade.
“The plan would do everything that comes naturally to a hard-nosed business executive. That’s the bad news. The plan would stretch out mail delivery deadlines, raise postal rates (perhaps steeply), cut back on post office hours and close branches… The worse news is inherent in these changes, taken all together. It’s that they reflect the notion that the USPS should be ‘run like a business,’ to repeat the usual formulation. This is a classic category error, in that it defines one object in utterly inappropriate terms. The Postal Service is not a business. Even those who say it should be run more efficiently, with smaller deficits or a profit, don’t really believe it’s a ‘business.’
“The USPS is a public service — the truth is right there in its very name. Forcing it to operate like a business, say by paying its own way on a profit-and-loss basis, is a path to exacerbating its problems and destroying it from within… Evidence of how the USPS differs from a conventional business is easy to find. The Postal Service has a statutory monopoly over letter mail. In return for what long has been assumed to be a competitive gift, it also has a statutory obligation to deliver mail to all points within the United States, at the same rates for a letter whether it’s going across town or from Key West to Hilo, Hawaii.
“The ability of the USPS to set its own prices isn’t unlimited, in the sense that a private business can set its own prices; postal rates are subject to the oversight of the Postal Regulatory Commission (formerly the Postal Rate Commission), an independent body, which can weigh in on rates, though not veto changes.
“The service is also subject to the oversight of Congress, which is bound to make its voice heard whenever the USPS airs plans to close local post offices, all of which are located in one or another member’s or delegate’s district… It’s also subject to the mandate that it prefund its retiree healthcare liability. DeJoy’s plan calls for repealing the mandate, which is one of its good points. As he told the House Oversight Committee during a Feb. 24 hearing , in private enterprise and throughout the government, ‘for the most part,’ such a mandate ‘is nonexistent.’…
“All the talk one hears about the course of the USPS’ business being “unsustainable” derives from the notion that it could somehow go out of business if it can’t get its financial house in order. In isolation, DeJoy’s projection of $160 billion in red ink over 10 years sounds dire for an organization with average annual projected revenue of about $70.5 billion in that period… In terms of the federal budget, however, it’s minimal — less than one-third of a percent of the projected government expenditures in the same time frame… DeJoy’s recommended changes would turn that deficit into a profit reaching $1.2 billion in 2030, even with sizable capital investments in equipment.
“One can accept his figures at face value, but they leave unanswered too many basic questions? Why must the USPS turn a profit? Why should its duty to deliver mail everywhere at a standard affordable rate be sacrificed to that goal?” For all those folks in isolated rural communities, where commercial delivery companies cannot operate on a sustainable economic basis, for all the seniors awaiting their social security checks and for all those Americans who cannot afford UPS, FedEx rates, the U.S. Postal Service remains essential. Most Americans continue to support the Postal Service the way it has always been intended.
I’m Peter Dekom, and using political flunkies, fund-raisers, to do the serious policy-making for essential government services in a way that favors one political party over another needs to stop!
Posts
No comments:
Post a Comment