Keep US Posted Raises Red Flag on USPS Postage Strategy As Financial Losses Persist

The nonprofit advocacy group Keep US Posted has issued a warning regarding the substantial and unprecedented United States Postal Service (USPS) postage hikes that have been impacting American consumers and businesses.

Check Out These Resources

• Do you need a business bank account for your online business? Take a look at our review of the five best bank accounts for sellers, some of which are free with no minimum balance or deposits. ^[sponsored]
• Boost your social media engagement with Publer. Learn how you can save time writing engaging content faster with AI. ^[sponsored]
• Could your online business use capital for growth? Here is a primer on revenue-based loans, and how they work.

Keep US Posted is a group that consists of consumers, nonprofits, newspapers, greeting card publishers, magazines, catalogs, and small businesses, cautioning that these increases are not yielding positive outcomes for the Postal Service and are imposing financial burdens on Americans.

This warning comes as the USPS reported a significant loss of $1.7 billion in its third-quarter 2023 financial report today.

Keep US Posted’s Executive Director, former Congressman Kevin Yoder (R-Kans.), emphasizes that despite setting record postage rates, USPS is still grappling with substantial losses beyond expectations.

Yoder contends that the Postal Service’s approach to multiple postage hikes within a short span of 12 months has given rise to what he calls “stampflation,” a term that illustrates the runaway nature of these increases.

He asserts that this strategy is not only affecting consumers but is also undermining the entire postal network’s stability.

Keep US Posted points out that despite the USPS receiving over $120 billion in relief from Congress since December 2020, the current model proposed by Postmaster General DeJoy, characterized by frequent rate hikes and increased spending, is unsustainable.

Yoder suggests that this approach could potentially lead to the downfall of the Postal Service, and as such, the burden should not rest solely on the shoulders of the American public.

DeJoy’s intention to generate more revenue through stamp price hikes is met with skepticism from Keep US Posted.

The group argues that with each rate increase, the demand for mail declines at a progressively faster rate, ultimately causing internal costs to rise and nullifying the anticipated revenue growth.

Keep US Posted contends that despite the passage of the bipartisan Postal Service Reform Act in 2022, aimed at preventing excessive postage increases and ensuring financial stability for USPS, the current leadership has disregarded the provisions of this law.

Yoder underscores the need for Congress to intervene and provide additional oversight over USPS’s rate strategy. He raises concerns that without intervention, a situation might arise that necessitates a federal bailout to rescue the Postal Service from potential collapse.

Keep US Posted Exposes Flaws in USPS Strategy

Furthermore, Keep US Posted has submitted an analysis to Congress challenging USPS’s plans to implement semi-annual postage rate increases. (See analysis here)

This report, conducted at the behest of the Greeting Card Association, a Keep US Posted member, exposes flaws in the Delivering for America plan’s projections and raises doubts about the viability of these excessive rate hikes.

Specifically, the analysis reveals that moderate rate increases initially had a more positive impact on mail volumes, but the recent trend of frequent and substantial hikes has resulted in a troubling decline in mail circulation.

Yoder concludes the “American public cannot, and should not, continue to shoulder Postmaster General DeJoy’s hike-and-spend model.”