Tester criticizes Postal Service execs for refusing lower pay

Senator questions executive salaries as Postal Service considers drastic cuts

(U.S. SENATE) – Senator Jon Tester is taking the leaders of the U.S. Postal Service to task, demanding that executives be willing to cut their own salaries as they propose cuts to the nation’s mail service.

Tester said that if senior postal executives were willing to cut mail delivery standards and close rural post offices, they should also be willing to “forgo bonuses or reduce salary.”  

The Postal Service’s Board of Governors recently told Tester that cutting the salaries of its top employees would have a “chilling effect on the management of the organization.”  Although the Postal Service is struggling financially, the Postmaster General last year earned $800,000 in pay and benefits.

Tester responded by pointing out that the heads of both the Treasury and Defense departments – facing their own difficult challenges – earn much less than they might in the private sector.

“Civil servants, like the Postmaster General, have unique public responsibilities and sacrifices inherent to their positions,” Tester wrote the Postal Service’s Board of Governors.  “The reality is that many of our government’s senior leaders share this distinctive burden.  Public service is uniquely different [from the private sector] and the Postal Service must rise to meet that expectation.”

Tester also took issue with the Board of Governors for suggesting that the Postal Service is a “private enterprise whose operations should be dictated solely by the private marketplace.” 

‘The Postal Service is a public entity with unique service requirements that are critical to rural America,” Tester wrote.  “Yet the Service’s plans to erode service standards, close facilities and thus reduce its own effectiveness suggest that this public requirement is lost on the Board of Governors and senior executives of the Postal Service.”

The Postal Service in August announced plans to consider closing 85 Montana post offices, and more recently recommended consolidating mail processing facilities in Kalispell, Missoula, Helena, Butte, and Wolf Point.  Pressure from Tester and Montanans eventually convinced the Postal Service to keep Missoula’s facility open. 

Tester, a member of the Senate committee that oversees the U.S. Postal Service, said that he remains committed to reforming the Postal Service in a way that preserves the “public nature of the institution.”

Tester’s letter to Board of Governors’ Chairman Thurgood Marshall Jr. and Board Member Louis Giuliano is available below and online HERE.

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February 28, 2012

Mr. Thurgood Marshall, Jr.
Mr. Lou Giuliano
Postal Board of Governors                            
United States Postal Service                                      
458 L’Enfant Plaza, SW
Washington, D.C. 20024-2114                      

Dear Governors Marshall and Giuliano:

Thank you for our recent meeting and your follow-up letter regarding the issues we discussed.  I appreciate that your responsibility as the Board of Governors is to advocate for the United States Postal Service and report to Congress on the Service’s best interests.  However, I am deeply concerned by several of the assertions in your letter and the organizational culture being fostered at the Postal Service. 

Make no mistake:  I appreciate your perspective on the state of the Postal Service and the willingness of the Postmaster to reconsider the wisdom of closing post offices and other facilities in Montana and elsewhere.  But I believe we have vastly different visions about the future of the Postal Service.

You wrote that the Postal Service is required by Title 39 to compensate its leaders at a level commensurate with the private sector, while providing a public service.  However, civil servants, like the Postmaster General and other senior Postal Service executives, have unique public responsibilities and sacrifices inherent to their positions.  The reality is that many of our government’s senior leaders share this distinctive burden.  The Secretary of the Treasury presides over our nation’s economy at one of its most turbulent times in history on a civil servant’s salary.  The Secretary of Defense is responsible for maintaining our nation’s security while overseeing 1 million men and women in uniform who were until just recently, engaged in two wars.  Both secretaries have accepted compensation that is likely much less than they would receive in the private sector and four times less than the Postmaster General’s annual compensation package.

Public service is uniquely different and the Postal Service must rise to meet that expectation.  I am concerned that your letter suggests that the Board of Governors views the Postal Service as a private enterprise whose operations should be dictated solely by the private marketplace.  It is not. 
The Postal Service is a public entity with unique service requirements that are critical to rural America.  Yet the Service’s plans to erode service standards, close facilities and thus reduce its own effectiveness suggest that this public requirement is lost on the Board of Governors and senior executives of the Postal Service.
           
Finally, the Postmaster and members of the Board are urgently requesting changes to the law that will result in financial benefit to the organization. At the same time, the Postmaster has proposed a dramatic restructuring of the Postal Service that would reduce employment in the coming years. As I have mentioned before, at this time of restructuring, it seems appropriate that senior executives at the Postal Service and members of the Board should acknowledge this sacrifice.  As other private companies have done when they have sought favorable treatment from Congress, senior leaders of the Postal Service should forgo some compensation.  Yet to date, not a single executive has offered to forgo bonuses or reduce his salary during this difficult time.

I still expect that Congress will ultimately pass postal reform legislation that improves the financial situation of the Postal Service while preserving the public nature of the institution.  I am committed to working with you and my colleagues to ensure that happens quickly. 

Sincerely,
(s)                                            
Jon Tester                                                                   
United States Senator                                        

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