Two weeks ago we published in this space a letter about the postal crisis from Time Inc. Chairman Andrew Heiskell to President Ford. The President has replied to Mr. Heiskell's letter and we are pleased to carry his response.

Dear Mr. Heiskell:

Thank you for your letter of December 12, 1975. I appreciate your sharing your thoughts with me with respect to the problems of the U.S. Postal Service.

At the time of postal reform, our postal system was in serious trouble. It was suffering under an archaic organizational structure and overlapping and often contradictory laws and regulations. It was also hindered by an ancient physical plant, low employee morale and productivity, and political pressures. These problems left a poor legacy as postal management has struggled to bring about change. Improvements have been made and, despite occasional complaints, the overall record of the Postal Service in terms of reliability and speed of delivery is quite good, particularly when compared with other countries.

This is not to say that postal management cannot do more to reduce unnecessary costs. I know that Postmaster General Bailar is devoting his full energies to this goal. While recent rate increases have been larger and more frequent than we would like, these cannot be attributed solely to the acts of the postal management. The Postal Service, like all business type operations, has had to deal with the strong inflationary pressures of the past few years.

I still believe that the principles embodied in postal reform will provide us with a far more efficient postal system. Among those principles is one which calls for the apportioning of the costs of all postal operations to all users of the mail on a fair and equitable basis. I support that principle; I believe it is sound and that it should be pursued to the maximum extent possible.

The cost of postal operations must be met and should be met equitably. The alternative to users supporting the postal system is to shift the burden to the general taxpayer. Such an approach is not fair and--by itself--would do nothing to reduce postal costs.

I would like to comment briefly on some specific points which you raised in your letter concerning Executive Branch control over the Postal Service. Under the Reorganization Act the operating budget of the Postal Service is the responsibility of the Board of Governors. Federal appropriations to the Postal Service Fund represent only a small portion of total postal revenues and are provided to cover certain specific costs. Among other things, they provide for public service assistance to the Postal Service during the transition to a completely independent status. I have continued to support the annual appropriation of those funds as set forth in the Reorganization Act, but I have also opposed further taxpayer assistance for extended phasing. I do not have responsibility for making recommendations on the remainder of the Postal Service's budget.

In keeping with the Postal Service's new independent status, the White House neither approved nor disapproved the recent postal labor settlement.

There are no easy solutions to the problems and deficits which face the Postal Service. Future rate increases will be necessary to cover costs, and I believe it is reasonable to expect such increases as long as they follow other general price increases in the economy. I remain unconvinced that taxpayers should be responsible to hold down rates for users.

Again, thank you for writing and best wishes. Sincerely, Gerald Ford

We are grateful for the President's letter. But we respectfully suggest that Mr. Ford has failed to respond to key points at issue. Nowhere does he reply to our detailed comparison of the Post Office deficit with that of New York City, even though that comparison was originally suggested by the President himself. Nor is there any recognition in his letter that the present postal nightmare concerns not just fiscal appropriations but the health and even survival of much of the free press.

In his meeting with the magazine publishers, President Ford said he felt it necessary "to really put the screws on " the Postal Service. Yet in his letter Mr. Ford says almost nothing about the question of postal salaries. Whatever "putting the screws on " means, it cannot exclude the problem of wages. The President was tough in his meeting but is benevolent in his letter.

What the President does say about wages is that "the White House neither approved nor disapproved the recent postal labor settlement." The fact is that a member of his staff, just nominated by him to be the new Secretary of Labor, headed the agency which conducted the negotiations that led to the most recent postal contract.

The President says he supports "apportioning of the costs of all postal operations to all users of the mail" with no allocation at all to the "general taxpayer." But aren't those who receive mail also users as well as taxpayers? Aren't recipients of monthly Social Security checks users? A significant portion of postal costs are generated by service to recipients, i.e. taxpayers, especially those in rural and isolated communities. Such service is direct to the home and without charge. For almost any comparable service, the citizen must make his own pickup or pay for delivery to his home. In testimony before the House Subcommittee on Postal Service this past summer it was suggested that an amount equal to $35 for every postal delivery address would be one way of measuring the public service function of the Postal Service, a service which should be financed from general revenues. That would amount to well over $2 billion or more than enough to cover the foreseeable postal deficit.

In closing the President suggests "it is reasonable to expect" further increases "as long as they follow other general price increases in the economy." The lamentable fact is that present and scheduled postal rate increases are grossly out of line with past or predicted general price hikes. Time Incorporated's second-class postage rates have increased 146% over the past five years. If the already scheduled rate increases take effect, that figure would jump to an increase of 389% in July 1979. And without funding for extended phasing, which the President opposes, that 389% increase will become effective this year. For a monthly magazine like the Atlantic, the comparable rate increases would be 100% and 270%. For a typical weekly newspaper, the percentages of increase are 140% and 680%. By any index of prices, such hikes cry out for comparison to those that the OPEC cartel has imposed upon us.

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