The Route Forward for the U.S. Postal Service: A View from Stakeholders

Health Care Costs and Drug PricingHouse Oversight and Government Reform Subcommittee on Government Operations · June 24, 2025 · 119th Congress
The House Oversight and Government Reform Subcommittee on Government Operations held this hearing (June 24, 2025) to hear from mailing-industry and postal stakeholders on the U.S. Begins at ▶ 0:00:00
Transcript
Highlights

Title

Postal Service reform, privatization concerns, and Delivering for America plan

Purpose

The House Oversight and Government Reform Subcommittee on Government Operations held this hearing (June 24, 2025) to hear from mailing-industry and postal stakeholders on the U.S. Postal Service's financial condition, the Delivering for America (DFA) plan, and proposals to reform USPS governance, staffing, and investment rules ahead of incoming Postmaster General David Steiner. Witnesses debated whether DFA's processing-facility investments and rate increases have helped or hurt service, and members clashed over proposals to privatize or restructure the agency. Begins at▶ 0:00:00

Who spoke

• Chairman Pete Sessions (R-TX)▶ 0:00:46: Opened by saying the postal service must be efficient, reliable and stable, and that no single person can guarantee a fix▶ 0:00:46; later pressed witnesses on overstaffing▶ 1:49:26, pension investment reform▶ 2:20:18, and clarified the committee is not seeking outright privatization▶ 2:26:45.

• Ranking Member Kweisi Mfume (D-MD)▶ 1:59:16: Withheld early questions to let other members go, entered several unanimous-consent statements for the record▶ 1:59:45, and later asked Cochrane about "systemic slowdowns" from the regional transportation optimization initiative▶ 2:50:09 and Steidler about robotics/AI and the postal board of governors▶ 2:51:28▶ 2:54:49.

• Mr. Jim Cochrane, CEO, Package Shippers Association▶ 0:04:04: Testified DFA is pushing USPS away from reliable, affordable universal service and is failing to meet promised financial results▶ 0:05:02; criticized "insourcing" that poaches shipping customers▶ 0:05:31 and called for public-private partnerships in middle-mile transportation▶ 0:07:44; later said reopening last-mile drop-off access could ease gridlock▶ 2:09:25▶ 2:44:52.

• Mr. Paul Steidler, Senior Fellow, Lexington Institute▶ 0:10:06: Called the state of USPS "dismal," citing the October 2021 service-standard degradation allowing 39% of mail to be delivered a day later▶ 0:11:29 and a forever-stamp price rise to 78 cents on July 13▶ 0:11:59; said USPS has a negative net worth of $32.6 billion despite $107 billion in 2022 Postal Reform Act relief▶ 0:12:22▶ 0:12:45; said the board of governors is "broken" and should be replaced▶ 0:10:58; cited 533,724 employees at end of 2024, 9% more than in 2014 despite a one-third drop in mail volume▶ 1:50:09▶ 1:50:35, and an IG estimate of $1.2 trillion in lost investment gains from restricting pension funds to government bonds▶ 2:21:34.

• Mr. Mike Plunkett, CEO/President, Association for Postal Commerce▶ 0:15:31: Said USPS is on track to lose nearly $10 billion this year▶ 0:16:17; urged a "strategic pause" on DFA, including insourcing and discretionary capital spending▶ 0:18:36; warned upcoming rate hikes (many over 10%) could gridlock the network by mid-July and that the governors never responded to a letter urging postponement▶ 0:18:56▶ 0:19:26; later detailed a July 11.4% rate hike surprise to mailers▶ 2:43:33 and said no evidence shows the $40+ billion in package-facility investment has improved service▶ 2:28:33.

• Mr. Thomas Schatz, President, Citizens Against Government Waste▶ 1:32:02: Said CAGW supported the 2021 Postal Service Reform Act but DFA has fallen short, citing $9.5 billion in FY losses▶ 1:33:58; called for a moratorium on new processing facilities, a hiring freeze for non-delivery positions, and termination of the regional transportation optimization initiative▶ 1:35:19; noted labor is 80% of costs▶ 1:35:49 and that DeJoy converted 195,000 part-time jobs to full-time▶ 1:35:49.

• Dr. Elena Spatoulas Patel, University of Utah▶ 1:36:44: Said USPS's funding model is broken and Congress should provide direct appropriation (~$6.3 billion, PRC's 2024 estimate) to cover the universal service obligation▶ 1:39:32; said mail volume fell 60% since 2009 and is projected to fall another 28%▶ 1:38:40; argued privatization is incompatible with universal service and would require taxpayer funding regardless▶ 2:19:14; distinguished "liberalization" from full/partial privatization▶ 2:23:19.

• Mr. Brian Renfroe, President, National Association of Letter Carriers▶ 1:41:00: Opened by noting the death of Dallas letter carrier Jacob Taylor on June 21▶ 1:41:23 and urged passage of the Protect Our Letter Carriers Act▶ 1:41:54; cited a roughly $90 billion pension-liability misallocation from the pre-1971 postal era▶ 1:44:44; said he knows of no location where letter carriers are overstaffed▶ 1:51:00; later said privatization would erode the universal service obligation and raise costs▶ 2:05:33.

• Rep. Suhas Subramanyam / "Miss Norton" (D)▶ 1:53:30: Warned about President Trump's stated interest in privatizing USPS and asked Dr. Patel whether he has unilateral power to do so (no, per Patel)▶ 1:54:27▶ 1:54:57; questioned the DOGE-DeJoy agreement's continued effect and lack of transparency▶ 1:55:44.

• Rep. Maxwell Frost (D-FL)▶ 2:00:38: Noted USPS processes 23.5 million packages a day▶ 2:01:07 and that top customers include competitors like FedEx, UPS, and Amazon▶ 2:01:50; cited a Wells Fargo report that privatization would raise package rates 30–140%▶ 2:02:16 and that 75% of mail routes lose money▶ 2:04:40; noted USPS delivers 1.2 billion prescriptions a year, including 80% of VA outpatient prescriptions and medication to 330,000 veterans daily▶ 2:05:57.

• Rep. (chairwoman of the Rules Committee, R)▶ 2:07:32: Asked Cochrane about maximizing private-carrier handoffs for final-mile delivery▶ 2:09:25 and Dr. Patel about the impact of spinning off the package business or cutting delivery days in rural districts▶ 2:10:12; recounted personally distrusting USPS with her mail a year ago due to poor service▶ 2:14:08.

• Rep. Marie Gluesenkamp Perez / "Miss Randall" (D-WA)▶ 2:14:38: Described the regional transportation optimization initiative's impact on Aberdeen (100+ miles) and Forks (150 miles) from the Seattle hub▶ 2:15:32▶ 2:15:57; cited a constituent letter warning about ballot delivery risks▶ 2:16:20; asked Renfroe whether degrading rural service for modest savings is reasonable — he said no▶ 2:16:53.

• Rep. Buddy Carter / "Mr. Jack" (R-GA)▶ 2:27:38: Noted disruptions at the Palmetto Mail Facility and asked Plunkett whether DFA's $40+ billion in package-facility investment improved service (Plunkett: no evidence)▶ 2:28:06▶ 2:28:33; asked Schatz to highlight further waste, fraud, and abuse▶ 2:31:42.

• Chairman James Comer (R-KY), full committee chair ("young chairman")▶ 2:33:05: Asked Schatz for top cost-cutting steps, criticized the part-time-to-full-time conversion▶ 2:34:04; asked Cochrane whether sorting/processing consolidation was a mistake — Cochrane confirmed it degraded performance▶ 2:38:07.

• Rep. Tim Burchett (R-TN)▶ 2:41:41: Asked how many unions operate within USPS (four)▶ 2:41:49; questioned Plunkett on business reaction to rate increases▶ 2:42:19 and Cochrane on private-sector processing efficiency▶ 2:44:52; shared a personal story about mailing packages as a boy with his father, a WWII veteran▶ 2:46:45.

Key moments

• Steidler said USPS will run out of cash before the 2028 election despite $120 billion in direct government assistance since 2020, and never met the break-even goal promised for FY2023▶ 0:12:45▶ 0:13:13▶ 0:13:38.

• Plunkett said the postal network could be "gridlocked by mid-July" from combined rate hikes and reduced work-sharing incentives, and the governors never responded to APCO's letter urging a delay▶ 0:18:56▶ 0:19:26.

• Schatz cited the GAO's high-risk listing of USPS since 2009 — the last year it posted a quarterly profit — and called its business model "unsustainable"▶ 1:34:24.

• Steidler said the postal service's own IG found that investing 60% of retirement assets in stocks (as teachers' and firefighters' funds do) would have yielded $1.2 trillion in additional gains over 50 years, about $20 billion a year▶ 2:21:05▶ 2:22:04.

• Sharp exchange on staffing: Steidler cited 533,724 USPS employees (up 9% since 2014) despite a one-third volume decline and the steepest total-factor-productivity drop since 1965▶ 1:50:09▶ 1:51:00; Renfroe countered he knows of no location among the 200,000+ letter carriers he represents that is overstaffed▶ 1:52:04.

• Rep. Frost cited a Wells Fargo report finding privatization would raise package rates 30–140% and that 75% of mail routes currently lose money▶ 2:02:43▶ 2:04:40.

• Comer and Cochrane agreed that sorting-facility consolidation degraded performance without helping the bottom line, and Cochrane argued private-sector sorting could work "just like it worked with packages"▶ 2:35:26▶ 2:38:35.

• Rep. Gluesenkamp Perez detailed how the regional transportation optimization initiative leaves constituents in Aberdeen (100+ miles) and Forks (150 miles) from the Seattle hub facing degraded delivery, including ballot-safety concerns raised in a constituent letter▶ 2:15:32▶ 2:16:20.

• Renfroe opened his testimony noting letter carrier Jacob Taylor died on the job in Dallas on June 21, and urged passage of the bipartisan Protect Our Letter Carriers Act▶ 1:41:23▶ 1:41:54.

• Chairman Sessions stated the postal service "is not for sale and will not be sidelined"▶ 0:01:17, while multiple witnesses (Patel, Renfroe, Schatz) agreed privatization would not solve USPS's structural funding problem and could worsen rural service▶ 1:55:21▶ 2:05:33▶ 2:42:42.

Metadata

CommitteeHouse Oversight and Government Reform Subcommittee on Government Operations
Chamber / CongressHouse · 119th Congress
DateJune 24, 2025
TypeHearing
Witnesses
Mr. Paul Steidler — Senior Fellow, Lexington Institute
Mr. Jim Cochrane — CEO, Package Shippers Association
Mr. Mike Plunkett — CEO and President, Association for Postal Commerce
Mr. Thomas Schatz — President, Citizens Against Government Waste
Ms. Elena Spatoulas Patel — Assistant Professor / Marriner Eccles Institute for Economics and Quantitative Analysis, University of Utah
Mr. Brian Renfroe — President, National Association of Letter Carriers
Videoyoutube
Transcript256 caption blocks · 17,672 words · 3:01:23 runtime
EventCongress.gov 118417