March 17, 2026
The Honorable James Comer
Chairman, House Committee on Oversight and Government Reform
Washington, DC 20515
The Honorable Robert Garcia
Ranking Member, House Committee on Oversight and Government Reform
Washington, DC 20515
On behalf of National Taxpayers Union (NTU), the nation’s oldest taxpayer advocacy organization, I write to share our views in advance of the Committee’s oversight hearing into the U.S. Postal Service (USPS). This topic is highly important to NTU, which has been involved in USPS reforms since the 1970s, as today the fiscal situation has deteriorated substantially and threatens taxpayers. Without decisive action, the Postal Service’s financial trajectory will continue to burden taxpayers and undermine confidence in federal stewardship.
As you know, the USPS has operated under a fundamentally unsustainable business model for years. Since 2006, the agency has accumulated net losses totaling $118 billion, including a $9 billion loss in fiscal year 2025 alone, while its unfunded liabilities have continued to grow following the implementation of its latest strategic plan. It is not an exaggeration to warn that the Postal Service is moving toward a financial crisis that could once again necessitate a costly taxpayer-funded bailout—similar to the $57 billion bailout enacted in 2022.
The core problem is not merely temporary financial stress, but structural misalignment between the USPS’s mandates and modern market realities. The agency is expected to function simultaneously as a government service, a regulated monopoly, and a commercial enterprise competing with private carriers. This hybrid model discourages innovation, shields inefficiencies from market discipline, and leaves taxpayers exposed to long-term financial risk.
Mail volumes—the agency’s traditional revenue base—have steadily declined as Americans shift toward digital communication and private-sector delivery alternatives. At the same time, labor costs, pension obligations, and operational inefficiencies have continued to grow. Despite periodic legislative interventions and accounting adjustments, the Postal Service has accumulated tens of billions of dollars in liabilities and continues to record substantial annual losses.
Congress should pursue reforms guided by fiscal responsibility, transparency, and competition. There is no single antidote to solve the problems that have compounded since 2006, but the sooner comprehensive reforms are instituted, the less painful the consequences will be. Further, these solutions may not be popular with the public, but they are substantially better than the alternatives. The Government Accountability Office (GAO) has offered a menu of options, but we believe that the following can make the most meaningful impact quickly:
Streamline operating costs. Using FY24 data, labor costs accounted for almost 77% of the agency’s total operating costs. Because of this high percentage, labor ultimately must be the primary area from which to reduce costs. Doing so through a gradual reduction in headcount, using a combination of staggered layoffs, buy-outs, natural attrition, hiring freezes, in addition to changes to employee health care or retirement benefits, could save billions a year. Ideally, the average pay and benefits would align with competitors in the private sector. To ensure no community suffers from delays in mail/package service during this transition, USPS could operate cluster boxes to best serve residents.
Increase flexibility of delivery schedules. It is a fact that paper mail volume has declined considerably, and will likely continue its decline in the years ahead. To equalize service with the drop in demand, Congress should reduce the number of days that USPS mail delivery is available and consider granting USPS more pricing flexibility. As it stands, a six-day delivery schedule makes little economic sense in the age of the internet.
Adjust collective bargaining requirements. Data indicate roughly 80% of USPS employees fall under collective bargaining agreements, which, as a result, reduce flexibility and make it harder to adjust core postal functions. Congress should repeal collective bargaining at the USPS and move toward private-sector labor standards under which the overwhelming majority of Americans currently fall.
Close surplus post office locations. The United States government operates more than 33,000 post office locations. Many of these locations are within close proximity to another post office, or in other cases, serve communities with limited foot traffic. To save money while having as little impact as possible on service, Congress should make it easier to close offices that are redundant or not cost-effective to operate.
Reform does not mean abandoning the Postal Service or the communities it serves. Rather, it means preserving USPS by adapting it to the economic realities of the 21st century. Like many of you, we believe government institutions should be accountable, efficient, and financially sound. Allowing persistent deficits to accumulate without reform undermines those principles and shifts today’s costs onto future generations.
The American people deserve a postal system that is reliable, modern, and fiscally responsible. Congress has both the authority and the obligation to enact reforms that prevent further financial deterioration and ensure the USPS can fulfill its mission without becoming a permanent taxpayer liability. NTU looks forward to working with you to achieve this vital goal.
Sincerely,
Thomas Aiello
Vice President of Federal Affairs