Amid $16B in losses, Congress proposes changes for the Postal Service

Ideas that Congress is introducing to help the Postal Service following $16 billion in losses include ending Saturday and door-to-door delivery.
CBS News

(CBS News) NEW YORK - Mail service as all of us know it could be headed for some historic change. With $16 billion in losses last year, Congress is looking to cut costs.

The latest congressional proposal could radically change your mail service. On the table: ending both door-to-door and Saturday letter delivery.

The new ideas were introduced by House Oversight Committee Chairman Darrell Issa

"It's an agency in crisis," he said, "but its also an entity that must be saved, but it's an entity that needs to trim costs."

Door-to-door mail delivery on chopping block

Postmaster General Patrick Donahue agrees the post office needs to re-think its operation.

"We've lost 27 percent of our mail over the course of the last five to six years," he said. "And when that happens, you have to make changes."

The new proposed delivery service would end at the curb or require new centrally located cluster-boxes, cutting back the number of steps mail carriers make each day.

"That cost of going that little bit further to the door is over 80 cents a day," said Issa. "That's the kind of savings that adds up to $6.5 billion."

The post office says ending Saturday delivery of first class mail altogether would save another $2 billion.

But postal union official Chuck Zlatkin said the financial crisis is overblown, and that Congress is just trying to privatize the business."I would say that this bill is really a road map to destroy the Postal Service as we know it," he said.

But the Postal Service, drowning in debt, is already selling its historic buildings to raise billions -- sparking one protests Saturday in the Bronx.

"We don't need all that space," said Donahue. "We need to continue to shrink down, so we can match up our costs with our revenues. "

In addition to selling post offices, the Postal Service has already reduced its workforce by nearly 200,000 and cut 21,000 mail routes. And if the reform bill passes, more cuts on the way.