A Search for Deliverance

As the commercial flashes on the screen, a schoolboy is opening a letter from his grandmother. He begins to read, and the scene shifts slowly to an elderly lady in a distant city smiling at a photo of her grandson. A voice-over intones the message: "P.S., write soon." That bit of soft-sell--strongly reminiscent of A T & T's familiar telephone commercials--is now being test marketed in Atlanta, Minneapolis-St. Paul and Columbus. It is part of an experiment by the U.S. Postal Service to boost revenues by getting more people to use the mails. The unusual TV promotion is the latest effort by the embattled Postal Service to lift itself out of financial trouble that seems to grow more severe with each passing month.

The service, a quasi-independent corporation that replaced the old politically dominated Post Office Department in 1971, has had money problems ever since it was created. Today, the woes of the service have reached such alarming proportions that postal officials in Washington are privately discussing the possibility of an outright financial collapse in a year and a half. One of the bleakest assessments yet of the service's future is contained in a speech this week by Postmaster General Benjamin F. Bailar before the Economic Club of Detroit. Unless drastic changes are made in the way that Americans send and receive their mail, Bailar warned, "we are heading for potential disaster."

Slumping Volume. Bailar's fears are well founded. Inflation has kicked up the service's operating costs at the same time that recession and rate increases have reduced mail volume for the first time since the Depression. Volume, which hit a peak of 90 billion pieces in 1974, dropped by 1% last year and is expected to slump to about 84 billion pieces over the next five years. Mailings will be held down in the future by, among other things, the expanding use of electronic funds transfers. The Social Security Administration is already crediting some payments to recipients' bank accounts instead of mailing checks to homes. Newspapers, magazines and other mass-volume mailers are seeking to cut costs by using private carriers.

Despite a current annual budget of $14.2 billion and a recent rate hike that averaged 26% on all classes of mail, the service will post a deficit of $1.4 billion this fiscal year, which ends June 30. To make ends meet, the service wants Congress to double its present $920 million annual public service appropriation. The Administration is opposed to such an increase contending that mail users should pay for rising costs. Some Congressmen who want to return to the old post-office system note that the Postal Reorganization Act of 1970 insists that the service strive to be selfsupporting.

In his speech, Bailar contends that the Postal Service has tried to cut costs and improve productivity wherever possible. The service is redrawing letter carriers' routes to equalize the work load, forcing employees to move from overstaffed offices to understaffed ones, thus reducing the need for overtime and saving an estimated $600 million a year. But even more drastic measures are needed, says Bailar: "The public must either pay for the growing price of traditional services or be willing to give up something." The Postmaster General also questions the necessity of at least three traditional services:

1) Six-day-a-week delivery. Postal authorities have for some time been considering the possibility of dropping deliveries on Saturdays at an annual saving of $350 million.

2) Door-to-door delivery. If mail could be dropped at curbside mailboxes instead of directly at the front door, the letter-carrier force could be reduced at a substantial saving. Such a move would unquestionably run into fierce opposition from the 230,353-member National Association of Letter Carriers.

3) Maintaining a large number of little-used post offices. A study last year by the General Accounting Office, Congress's financial watchdog, found that up to 12,000 of the service's 31,000 post offices could be shut with no loss in efficiency. In the last year or so, Bailar has closed or consolidated 186 small offices. In response to a suit brought against the agency by 51 Congressmen, a federal district judge ruled that the Postal Service could close post offices as long as it followed certain, required procedures, namely, conducting a survey of mail users and providing a 90-day notice of closing. But the leader of the Congressional critics, Rep. Paul Simon, Illinois Democrat, says he will continue the fight to block further closings of small post offices.

Bailar, who has been sounding off to Congress about the service's troubles for months, intends to bring his case to the public in a series of speeches around the country. His basic argument is both simple and blunt: Congress will have to provide more money or agree to cuts in service. The success or failure of Bailar's mission could well determine whether the nation's experiment in operating a businesslike, non-political office will flourish or come to an early end.

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