PHILADELPHIA — President Trump indicated on Friday that he is considering placing the U.S. Postal Service under the authority of the Commerce Department. This would essentially give the executive branch control over the agency, which has functioned independently since 1970.
“We want a Postal Service that functions efficiently and avoids significant financial losses,” Trump stated. “We are exploring this possibility, which could involve a merger-like structure, while maintaining the Postal Service’s identity. I believe this would lead to improved operations.”
Trump made these comments during the swearing-in ceremony for Commerce Secretary Howard Lutnick, framing the potential move as a way to address financial losses at the Postal Service, which has an annual budget of $78 billion and has been challenged by the decline in first-class mail volume.
“He possesses strong business acumen, which is essential, and we are examining this issue with the belief that we can turn the situation around,” Trump said, referring to Lutnick. “The Postal Service has been a significant financial burden for the country, incurring substantial losses.”
Here are key details about the U.S. Postal Service:
What’s the history of the USPS?
The Post Office was established in 1775 during the Second Continental Congress in Philadelphia, with Benjamin Franklin serving as the first postmaster general. In 1872, Congress designated it as an executive branch department. However, this changed in 1970 following an eight-day postal worker strike concerning wages and benefits. President Richard Nixon then signed the Postal Reorganization Act, transforming it into an independent, self-funded entity known as the U.S. Postal Service.
In recent years, the Postal Service has faced financial challenges and resisted calls for privatization from Trump and others.
Who works for the USPS?
The 1970 reorganization provided workers with pay increases and collective bargaining rights, which aided numerous Americans, particularly Black individuals and other minorities, in achieving middle-class status. Currently, the USPS employs approximately 640,000 individuals responsible for delivering mail, medications, election ballots, and packages across the nation, from urban centers to rural communities and remote islands. These employees continued working throughout the coronavirus pandemic, during which, according to the American Postal Workers Union, over 200 postal workers died.
Who runs the USPS?
Louis DeJoy, a Republican donor with a background in logistics, was appointed Postmaster General in 2020 during Trump’s presidency. His tenure has been marked by various challenges, including the pandemic, increases in mail-in voting, and criticisms related to cost-cutting measures and service reductions. After announcing a 10-year recovery strategy last year, he recently indicated his intention to resign and requested that the Postal Service Board of Governors commence the search for his replacement.
Who serves on the U.S. postal board and how are they selected?
The board consists of up to nine members, who are nominated by the President and confirmed by the Senate. No more than five members can be from the same political party.
The current chair is Amber F. McReynolds, a former election official from Colorado. The vice chair, Derek Kan, previously worked in the Trump administration. Both were appointed by President Joe Biden.
Three positions on the board are currently vacant, as the Senate did not vote on Biden’s nominees. Biden appointed four of the six current governors, while Trump appointed the other two.
The board is responsible for hiring and dismissing the postmaster general. Both the postmaster general and a deputy postmaster also serve on the board.
How is the USPS funded?
The USPS has been primarily self-funded since the 1970 reorganization. The majority of its $78.5 billion annual budget is derived from customer fees, according to the Congressional Research Service. Congress allocates a relatively small annual amount—approximately $50 million in fiscal year 2023—to subsidize free and reduced-cost mailing services.
Faced with challenges such as the decline in profitable first-class mail and the expense of retiree benefits, the Postal Service accumulated $87 billion in losses between 2007 and 2020.
Last year, DeJoy unveiled a 10-year plan aimed at modernizing operations and reducing losses, cautioning customers to anticipate “uncomfortable” rate increases as the Postal Service endeavors to stabilize its finances.
Critics, including members of Congress from various states, have asserted that initial consolidations have resulted in slower service and that further consolidations could disproportionately affect rural mail delivery.
How does President Trump view the USPS?
Trump has been critical of the Postal Service since his first term. In 2020, he threatened to withhold COVID-19 relief funding unless the USPS quadrupled package rates for major customers such as Amazon, owned by Jeff Bezos. Bezos also owns The Washington Post, whose coverage was often critical of Trump.
More recently, in December, Trump speculated about privatizing the Postal Service, citing competition from companies such as Amazon, UPS, and FedEx.
“It’s an idea that many people have considered for a long time. We are examining it,” the president stated.
