D'oh! Dem Congressman Undermines Ed Schultz's Claim That Postal Service Receives No Subsidy

How can you tell when Ed Schultz doesn't know what he's talking about? When Schultz boasts, "I know what the hell I'm talking about."

Most recent example -- Schultz's bloviations about the postal service on his radio show Tuesday (audio) --

Couple of things that we need to make sure that everybody understands. No tax dollars, your tax dollars, do not go to the postal service. That's right. There's not a line item budget in the federal budget that says that we're spending $10 billion on the postal service. That doesn't exist. We don't spend ten cents on the postal service. So in other words, all those taxes that you are paying today ... none of that money goes to the postal service. The Treasury doesn't fork a dime over to run the postal service. It's stamps, that's right, and anything else that you have to purchase when it comes to moving the commodity which is the mail. That's what pays for everything.

Sorry to dampen your huff-and-puff bluster, Ed, but the postal service does receive funding from the federal government. And while it's not $10 billion, it's substantially more than 10 cents -- closer to $100 million annually -- to provide free mail services for the blind and overseas voters.

Even though it represents less than one percent of its annual budget, this is hardly the only way the agency benefits from government policy. Boston Globe columnist Jeff Jacoby elaborates --

The Internet Age may be wreaking havoc with the post office and its mail-delivery business, but what industry in America isn't going through the same wrenching experience? And not many institutions enjoy the benefits that federal law confers on the Postal Service: It pays no income or property taxes, it's exempt from vehicle licensing  requirements and parking fines, and it has the power of eminent domain. Most significant of all, it has a legal monopoly on the delivery of mail: The federal Private Express statutes make it a crime for any private carrier to deliver letters. The only exemption is for "extremely urgent" letters, and even those may be delivered by a private company only if it's willing to charge a much higher rate than the Postal Service would have charged.

In the 1960s, 83 percent of the agency's budget went to wages and benefits, Jacoby writes. As of 2011, despite billions of dollars spent on automation over the decades, that percentage dropped -- to 80 percent. This compared to 53 percent for UPS and 32 percent at FedEx, according to the New York Times.

"Only in a government-sheltered monopoly like the Postal Service would labor costs remains as bloated as they have, year in and year out," Jacoby writes.

But once Schultz settles on a perceived truth, nothing will shake his belief in its veracity. Here he refers to the postmaster general's proposal for massive layoffs, facility closings and reductions in services to avoid bankruptcy  (audio) --

The postal service is going to hurt a lot of small businesses that are going to have a ripple effect and a domino effect and a lot of small businesses are going to have to let people go because of this! Just take my word for it. I know what the hell I'm talking about.

Unfortunately for Schultz, one of his upcoming guests, congressman Peter Welch, Democrat of Vermont, wasn't aware of Schultz's omniscience on all matters postal (audio) --

SCHULTZ: What's happening with the postal service? Why are they doing this? I mean, I know why they're doing it, but ...

WELCH: There's a, it's ideological. In other words, what they constantly do is say, hey, why don't they run it like a business and they point to FedEx or they point to UPS, forgetting the fact that the postal service has to deliver everywhere. Rural areas like Vermont, you know, we get our mail out on these back country roads. I live on a dirt road that's eight miles long. Postal service gets up there. That's not a great profitable route for UPS or FedEx.

So, there's always been some subsidy for the postal service. The postal service has always had to make some adjustments. It used to be pony express and then we had the telegraph and they had to make adjustments. And obviously with the Internet, we have to make adjustments now. But there's an ideological view that you could outsource this, privatize it, but basically that would mean that you'd be denying service, especially to rural America.

SCHULTZ (ducking Welch's awkward observation that there's "always" been "some subsidy" for postal service): Yeah. Well, I think that the Senate, where they won't maybe well intended (huh ...?) are headed in the wrong direction.

Schultz also claims that a 2006 law forced the postal service to pre-fund its pension costs for 75 years within the following decade, to the tune of $5.5 billion annually. Almost always accompanying the claim is Schultz's insistence that it was Republicans who rammed the bill through a lame-duck Congress, followed by President Bush signing off on the legislation only weeks before Democrats gained control of the House in January 2007.

As can be seen in the legislative history of the Postal Accountability and Enhancement Act (PAEA),  the law was sponsored by GOP Rep. Thomas Davis of Virginia  -- and co-sponsored by Rep. Lanny Davis, D-Ill., Rep. John McHugh, R-N.Y., and Rep. Henry Waxman, D-Calif.

Schultz once again demonstrating that he doesn't know what the hell he's talking about.

Jack Coleman
Jack Coleman
Liberated ex-liberal from the People's Republic of Massachusetts