Retailers, newspapers, printing firms oppose U.S. postal rate hikes

FILE PHOTO: United States Postal Service (USPS) worker in Manhattan during outbreak of coronavirus disease (COVID-19) in New York

By David Shepardson

WASHINGTON (Reuters) – A coalition of retailers, newspapers, printers, greeting card companies and others oppose the U.S. Postal Service plan to hike postage prices for most mail by 7% and called on Congress to direct a new review before the increases take effect.

The group includes the National Retail Federation, Inc, eBay Inc, the National Newspaper Association, Envelope Manufacturers Association, Greeting Card Association and the American Forest & Paper Association.

The price increases to be implemented on Aug. 29 “will impose new and substantial costs to the detriment of the American public and businesses, especially small businesses, nonprofits and charities, consumers generally … and, of course, the millions of jobs postal-reliant businesses support,” the Coalition for a 21st Century Postal Service said in a letter on Friday.

USPS said in response on Friday that for the last 14 years it “has not had sufficient pricing authority to respond to changing market realities.”

USPS said the price hikes are needed because over the past 10 years, mail volume has declined by 46 billion pieces, or 28%, and is continuing to decline. “While we may have experienced an increase in revenue over the last year, it is not enough to offset the more than decade worth of losses,” a USPS spokesman said.

The agency says it will still have some of the lowest letter-mail postage rates in the industrialized world.

USPS has proposed a plan to cut $160 billion in forecasted red ink over the next decade. The plan would increase the cost of a stamp for first-class mail by 3 cents, to 58 cents.

The group noted USPS wants to generate an additional $35 billion-to-$52 billion from mail over 10 years.

“Increases of this magnitude are fundamentally unaffordable. Businesses reliant on USPS jointly generate $1.6 trillion in commerce and employ more than 7 million Americans … Small businesses and others will cut back on mail, with some not able to survive, and larger businesses will simply move more paper communications online.”

Other members include the News Media Association, Pitney Bowes, Quad Graphics, R.R. Donnelly, Major Mailers Association and Bank of America.

(Reporting by David Shepardson in Washington; Editing by Nick Zieminski and Matthew Lewis)