In heavily anticipated testimony to the U.S. House Government Operations Subcommittee, Postmaster General David Steiner announced that the USPS will likely hit financial insolvency by February of 2027 without action from Congress.
Steiner’s report to the committee on March 17 identified a series of congressionally-imposed restrictions on the Postal Service that must be removed urgently to provide breathing space for the 250-year-old agency.
As first-class mail has declined in the internet era, the number of delivery points has mushroomed, up by 36 million addresses since 2000. With costs rising and inflation-adjusted revenue down, the Postal Service needed revenue to modernize.
Just as the Postal Service desperately needed investment to modernize, it was forced to divert precious resources away because of federal restrictions on its access to capital, management of its pension and healthcare funds and the notorious pre-funding mandate for retirees’ health care benefits, which was finally abolished in 2022.
“I’ve done tons of strategic plans across a number of businesses and I’ve never had a strategic plan where they say so many options are not available to you,” said Steiner at the hearing.
Years of slow strangulation have left policymakers with few good choices. To avert a crisis and ensure continuity of mail service, the Postmaster General requested that Congress extends the USPS’s borrowing authority. By law, the Postal Service can only borrow money from the U.S. Treasury, and its borrowing limit is capped to $15 billion. That borrowing cap is unchanged since the early 1990s.
The Postmaster General also urged Congress and the Administration to adopt reforms which would re-calculate the Postal Service’s Civil Service Retirement System (CSRS) obligations and allow USPS retirement and health funds to be responsibly invested in higher-yield funds. These two reforms alone would save the USPS billions of dollars per year, and right decades-old injustices in the treatment of USPS’s retirement obligations.
As the famous adage goes, one person’s crisis is another person’s opportunity. Corporate lobbyists and think tanks are openly using this funding crisis as an opportunity to advance their agenda. While they know how hard it would be to pass legislation to privatize the Postal Service as a whole, they could succeed in parceling out portions of the USPS network until nothing is left.
In a July 2025 Government Operations sub-committee hearing, Chairman Comer recently asked Jim Cochrane, Chief Executive of the Package Shippers Association:
“Do you think there could be a private sector solution to the sorting just the sorting and I’ve always encouraged Mr. DeJoy to do a pilot project, one pilot project to privatize the sorting of the mail to see if we could do that more efficiently and quicker. Do you think that’s… a viable option?”
This question has been raised by corporate think tanks, such as the Frontiers of Freedom Institute and Citizens Against Government Waste, as well as organizations like the Mailers’ Association.
As Congress considers whether to provide this lifeline for the USPS, it is vital that we safeguard against outsourcing and privatizing, which would cost good jobs and damage the integrity of the Postal Service.
Steiner also acknowledged that the USPS has already shed up to 35,000 jobs in the past four years alone. He is also open to further cuts if outsourcing consultants Alvarez and Marsal recommend it to him. “…you’ve got to look at everything,” he stated.
Despite recognizing that hiring and retention in processing plants are causing delays “right down the center of America, from Chicago to Saint Louis to Memphis”, he also signaled that he intended to move to more insecure “pre-career” employment, rather than career jobs with full pay and benefits.
The USPS Inspector General’s office has slammed these insecure non-career jobs for unacceptably high rates of turnover. A recent report found that, in 2022, there was a staggering 59 percent rate of turnover among non-career employees. “… turnover can be harmful to operations, and replacement costs are often very high. The Postal Service’s 10-year strategic plan, Delivering for America: Our Vision and Ten-Year Plan to Achieve Financial Sustainability and Service Excellence, identified “unacceptably high rates of non-career employee turnover” as a key challenge,” it warned.
In 2020, A Grand Alliance to Save Our Public Postal Service, held a series of debates on the future of the Postal Service to build a people’s postal agenda. The meeting of postal workers, experts and civil society organizations set out a vision of a Post Office that can form a sustainable business model by meeting the needs of the people.
From providing affordable financial services, to social care spearheading the transition to a just, clean energy economy, there are many opportunities to make communities stronger and the Postal Service financially sustainable.
As Congress and Postal Service management plan how to get past this acute financial crisis, it’s vital that we make our voices heard and shape the people’s Postal Service.