Postal rates

Trump plans to use coronavirus funding to revamp postage rates

WASHINGTON – President Trump said on Friday he plans to use a coronavirus relief law as leverage to force the U.S. Postal Service to raise rates for parcel delivery, including those it delivers for Amazon and ‘other e-commerce businesses.

The Coronavirus Assistance Program allows the Postal Service to borrow up to $ 10 billion from the Treasury Department to fund operating expenses during the pandemic. The terms and conditions of these loans must be mutually agreed upon by Treasury Secretary Steven Mnuchin and the Postal Service, by law.

Speaking to reporters in the Oval Office on Friday, Mr Trump said he would not allow any loans to the Postal Service unless he no longer charges for parcel delivery.

“The Postal Service is a joke because they deliver packages for Amazon and other Internetx companies. And every time they bring a package, they lose money on it, ”the president said, adding that the delivery charge should be quadrupled.

“If they don’t increase the price, I don’t sign anything,” he said.

The president then turned to Mr. Mnuchin and asked if the secretary was okay with it.

“I’m doing it, and in fact, we’re going to put some criteria for a postal reform program under the loan,” Mnuchin said.

A USPS spokesperson declined to comment.

Mark Dimondstein, president of the American Postal Workers Union, said in a statement that Mr. Trump’s comments are “an insult to the 44 postal workers who have died in the line of vital public service amid this pandemic.”

“President Trump’s clear intention is to raise prices and cause a crisis at the post office so that his political benefactors of the transport companies can increase the profits of their business at the expense of the people,” Mr. Dimondstein.

Mr Trump has often criticized the Postal Service’s pricing structure, saying the so-called last mile service it provides to senders such as Amazon is undervalued and costs the agency money. The president is also a longtime critic of Amazon and its chief executive, Jeff Bezos, accusing the company of tapping into the Postal Service’s delivery network.

Amazon declined to comment.

Postal service regulators annually review shipping agreements with large customers and have not found the service Amazon uses to be a loser.

In recent weeks, Postmaster General Megan Brennan, who heads the Postal Service, called on Congress and the Trump administration to help shore up the agency’s finances, predicting that a sudden drop in mailing volumes during the pandemic would cause a loss of more than 22 billion dollars. over the next 18 months.

The Postal Service is losing much of the business it received from Amazon and other large customers as businesses increasingly deliver packages to homes.

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FedEx Corp.

is in the process of terminating a service where the postal service delivered approximately two million packages per day to residences. Instead, these packages are delivered by the company’s independent ground delivery contractors.

The Package Coalition, a group of companies that ship through the postal service, criticized the action proposed by Mr. Trump, saying it would “raise prices for consumers, raise prices for small businesses and raise prices. for rural communities ”.

John McHugh, chairman of the group, which includes Amazon, also called on Congress “to guarantee emergency relief for the postal service and stop this tax on packages.”

Write to Paul Kiernan at [email protected] and Paul Ziobro at [email protected]

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