USPS Prepares for a ‘Year of Implementation,’ and the Shaping of Louis DeJoy’s Legacy
The Postal Service chief gives himself an “A,” but doesn’t want you to evaluate him.
Louis DeJoy is going to make mistakes. A lot of them.
For the postmaster general, that is sort of the point. It is a sign of progress. He inherited a U.S. Postal Service in 2020 that was directionless, losing billions of dollars per year, shedding countless jobs and allowing mail delays to spike, all without a serious plan to turn things around. You may not like what he is doing about it, but he wants you to know he is doing something.
“A lot of people say they don't know exactly what we're doing,” DeJoy told Government Executive in a recent interview. “Well, neither do I.”
Again, that is a feature, not a bug. When DeJoy says he is going to “make a lot of mistakes,” it is because he is willing to adapt. He has a vision. He can see where there is $35 billion in costs to eliminate, when delivery trucks are running unnecessary routes and how to reduce turnover in the workforce. Not all of his ideas are going to work—some have already prominently failed—but he will continue pushing forward. He describes his biggest accomplishment as “juicing the place up:” namely, getting his management team and the rest of the 650,000 postal employees to embrace a mindset of change.
And when things go wrong, DeJoy and USPS will course correct.
“We also have visibility, we catch them now, and we react to them,” he said of the inevitable forthcoming mistakes. “And that was not here. And that's the beginning of a well run operational services organization. That's what I'm most proud of.”
For Edmund Carley, president of United Postmasters and Managers of America, that is a key difference between DeJoy and his predecessors. Under prior leadership, the Postal Service often stuck to its ideas regardless of whether they were working.
“When it’s a complete disaster, we’re just going to keep doing it,” Carley said in summarizing the attitude at USPS in the past. The new postmaster general, he conceded, “wants to assess and adjust.”
Carley has at times butted heads with DeJoy, but their relationship has improved as ideas have come into focus and communication has increased: “I’m more optimistic now than I was at this time last year,” Carley said.
‘Stuff to Work On’
All of the attitude shifting and vision making will come to a head in 2023, which will be a pivotal year for DeJoy’s “Delivering for America” plan to get USPS on firm financial footing within 10 years. He has already crossed major pieces of that agenda off the list: the first significant postal reform bill in 15 years, which is expected to wipe $107 billion off the agency’s books; a new pricing structure that has allowed DeJoy to raise rates above inflation; slowing down delivery for some mail to make performance targets more manageable; and stabilizing the workforce by converting more than 100,000 part-time employees to career positions. Next up, USPS will look to identify savings. Officials have found inefficiencies in the agency's network and will change delivery routes, get rid of buildings, buy some new ones, relocate employees, reduce mail sent through the air and do whatever else is necessary to improve.
“We have a terrible network,” DeJoy said. “We have a terrible operating strategy.”
Previously, he said, that all got swept under the rug, but that will no longer fly. Even when mistakes are made, at least they will be happening with purpose, toward an eventual goal.
“We have stuff to work on for, like, a long time, together as an organization,” DeJoy said.
That will include condensing and updating the more than 900 policy manuals USPS employs, improving facility conditions, making the flow of mail more logical (DeJoy wants to eliminate “wasted motion”), rerouting letter carriers starting their day away from post offices to consolidated sorting centers, adding equipment to boost package processing capacity and generally shifting from a scattered network to a fully integrated one. It is a process the postmaster general said will take years, but one that will get underway in earnest in 2023.
The first of hundreds of sorting and delivery centers just opened in Athens, Ga., with more slated for February. DeJoy is converting unused, dilapidated facilities or buying new ones to create mega-centers that can handle all sorts of processes currently spread across dozens of different buildings. In his telling, that will mean savings on transportation, gas, real estate and time. Employees will not lose their jobs, but some may have to report a different space. There remain serious questions about whether his reforms will produce the savings he has promised—previous efforts to consolidate facilities led USPS to perform worse while realizing just a tiny fraction of the cost reductions it had anticipated. DeJoy will not let those concerns stand in his way. To him, the solutions are obvious.
A Public Service
Not everyone is on board with what DeJoy has accomplished so far, which has earned him a shorter leash with some postal stakeholders for what lies ahead. Ask just about anyone and they will tell you DeJoy’s greatest achievement is obvious: helping to shepherd the Postal Service Reform Act into law. Even his greatest detractors will admit it could not have happened without him. His cozy relationship with Republicans—he took dozens of trips to Capitol Hill to assure wary conservatives of the merits of the legislation and the virtue of his larger vision—finally allowed to happen what lawmakers of both parties had tried and failed to do for a decade. He also helped secure $10 billion from Congress as part of pandemic relief, as well as a $3 billion appropriation to purchase electric vehicles.
To the Postal Service’s biggest customers, the plaudits do not extend much further. They say they have shouldered a disproportionate burden on DeJoy’s path to solvency.
“Any improvement from the financials so far,” said Michael Plunkett, executive director of PostCom, an association of large-scale private sector postal customers including Amazon and UPS, “has come through rate increases.”
DeJoy has vowed to cut costs and grow revenue, but the concern over the long term is that his strategy will drive people and businesses away from the mail—even more quickly than they have been leaving over the last 20 years—and Plunkett said he is seeing his marketing members cut the frequency of their campaigns or exit the system altogether. DeJoy promised to use his new rate-setting authority “judiciously,” but so far has increased prices nearly to the maximum extent allowed and doubled the frequency of the bumps.
“That’s not my definition of judicious,” Plunkett said.
To DeJoy, the losses are inevitable and the only real growth area is in packages. Plus, he has a statutorily-protected monopoly on regular mail.
“It’s not an easy time to be a mailer, but they don’t really have an alternative,” Plunkett added.
DeJoy has offered certain olive branches to his sharpest critics. Democrats and progressive groups that have for two years raised funds off the postmaster general’s name and continually called for his ouster have taken victory laps over the reform act's passage, a pilot program to allow for check cashing services at some post offices and, most recently, DeJoy’s announcement that 75% of the new USPS fleet will be electric. Still, they worry DeJoy and his Delivering for America plan has the Postal Service on a dangerous path. DeJoy himself admitted the electric vehicle plan was critical because without it, “we deal with a bunch of crap forever.”
To Porter McConnell, who co-founded the Save the Post Office Coalition, an alliance of nearly 300 left-leaning groups, all DeJoy’s accomplishments are in the shadow of his decisions to raise rates and cut service.
“It’s still in the context of the inevitable march to a less relevant Postal Service,” McConnell said.
DeJoy, by his own admission, is focused on only the bottom line. He has two goals: delivering to every American address and covering his costs. To many, his lens is too narrowly focused. USPS is supposed to represent something more, a constant in every city and small town and connective tissue between them.
“Being aware of the workforce and the responsibility to the local community as a public service is something he doesn’t pay enough attention to,” McConnell said.
She and her allies will not be satisfied until they see investments that capitalize on its unmatched footprint, such as by partnering with federal agencies like the Census Bureau and municipalities for hunting license renewal and public transit purchases (DeJoy noted the Postal Service’s successful initiative with the Biden administration to distribute hundreds of millions of COVID-19 test kits nationwide has created a use case for future revenue-generating partnerships). Others are waiting to see if DeJoy can fulfill his promises to reshape the network without further compromising delivery.
“Everyone is eagerly awaiting the promised efficiency gains,” Plunkett said.
Carley, of United Postmasters, said a lot of the coming changes have been tried in various iterations in the past. He is hopeful, however, that DeJoy’s background leading major private sector logistics companies will better position him to follow through. He noted DeJoy likes to “move quickly” and speak in “broad strokes,” which has created outrage in the workforce as new policies were communicated poorly. The postmaster general has since given Carley his personal number and the two often talk directly. With 2023 “the year of implementation,” as Carley put it, DeJoy can expect a lot more calls in the coming months.
A Race Against Time
For DeJoy, his legacy is on the line. If he pulls it off, if he can cut inefficiencies while boosting on-time mail delivery and eliminating annual deficits, it will go a long way to reversing the narrative that has defined much of his tenure. If he fails, it could cement his reputation as a conservative, private sector magnate incapable of recognizing USPS’ value as a public service. Asked to grade his performance so far, he gives himself an “A,” though he knows the hardest work is still ahead. He is committed to seeing his vision through, but down the line wants to give his successor a blueprint of how things work that he feels he never received. He also will offer a piece of advice, one perhaps unexpected from the often brash New Yorker.
“This is the best thing you’ll do in your life,” DeJoy plans to say.
Until that time, he has little patience for his critics.
“Unless you sit in this seat, and really understand how much has to be done, and how much pushback, how much response you get from the people here, you really can't evaluate me,” he said.
DeJoy has begged his skeptics—including those in Congress, his regulatory agency, his own workforce, his customer base and the public—to trust him, or if not him, the vision. The process. Just do not stand in the way. His biggest concern, he said, is not moving fast enough. In DeJoy’s mind, his agency’s clock is ticking toward irrelevance, and he wants to make sure the Postal Service is around for him to have that saccharine moment with his successor.
“That's why I'm here seven days a week, 15 hours a day,” DeJoy said, “because we are in a race against time.”