David Warsh: Of Postal Service and Social Security reform

The first U.S. postal stamps, which were issued in 1847

The first stamp issues were authorized by an act of Congress and approved on March 3, 1847. The earliest known use of the Franklin 5¢ (left) is July 7, 1847, while the earliest known use of the Washington 10¢ (right) is July 2, 1847. These issues were declared invalid for postage on July 1, 1851.

SOMERVILLE, Mass.

When the 117th  Congress convenes in January, its first order of business just might be to quietly undertake to fix the nation’s system of voting by reforming the U.S. Postal Service.

Critics routinely blame the USPS for losing money.  “It’s a Blockbuster service in a Netflix world,” asserted a Wall Street Journal editorial writer  the other day. What the editorialist failed to understand is that the USPS is isn’t a business, it is a civic institution.

The Postal Service is older than the Navy, the Marines or the Declaration of Independence, as historian Joseph Adelman has pointed out. Its creation, along with a system of post roads, was practically the first thing that the Second Continental Congress took up, after the Revolutionary War began at Lexington and Concord, in 1775.

They did it for a reason, Adelman writes in Revolutionary Networks: The Business and Politics of Printing the News 1763-1789 (Johns Hopkins, 2019).  Efficient and impartial communication of printed matter was essential to keep 13 diverse and far-flung colonies in touch with current news and opinion. The first Post Office Act, in 1792, set off steady expansion of the newspaper industry, and for the next two centuries printed matter accompanied first-class mail at bargain rates to every corner of the country.

True, a great deal has happened in the last 50 years.  Print newspapers seem to be on the ropes in a digital age. The rapid distribution of e-commerce merchandise has been largely taken over by United Parcel Service, Federal Express and, recently, Amazon. USPS has found a secure place among these newcomers in the package-delivery business thanks to peak-load pricing.

But now the COVID-19 pandemic has demonstrated that, thanks to voting by mail, old-fashioned first-class mail is a service that the U.S. cannot do without.  Thus putting the USPS on a long-term sustainable basis is a first-order problem of democracy.

How might it be done?  The election is fast approaching. The composition of Congress won’t be completely clear for some time after that.  But a look back at the little-remembered last time the sinews of American democracy were seriously threatened, in 1983, might be instructive. Still Artful Work: The Continuing Politics of Social Security Reform (McGraw Hill, 1994) provides some clues as to how such compromises are achieved.

Towards the beginning, Paul Light, now a political scientist at New York University, who followed the negotiations as a young Congressional Fellow, provided a capsule glimpse of the feel-your-way by which such things happen.

1. Reagan proposal to solve the Social Security crisis through deep budget cuts in May 1981

2. Passage of a scarcely noticed bill in December 1981 that would trigger a Social Security emergency in mid-1983

3. An attempt to tackle Social Security through the budget in April 1982

4. A break for the midterm congressional elections

5. The birth and death of the National Commission on Social Security Reform in 1982

6. The rise of a secret negotiating “gang” as a shield for talks between Reagan and [House Speaker Tip] O’Neill in January 1983

7. Navigation of the Social Security agreement through the interest-group-infested waters on Capitol Hill in March 1983

8. The final House-Senate conference just before the Easter recess in 1983

Congressman Barber Conable (R.-N.Y.) was an architect of the ultimate deal. He told Light that the final compromise “was not a work of art, but it was artful work,” providing the title for the book.  The analogy is not precise: Postal Service customers are not involved financially the same way as are Social Security recipients. But both selves are involved emotionally, and both vote.  Meanwhile, that earlier reform is itself none-too-gradually running out of time. Soon another Social Security fix will be required.

Here’s to the opportunities that lie ahead!

David Warsh, a veteran columnist and an economic historian, is proprietor of Somerville-based economicprincipals.com, where this column first ran.      

© 2020 DAVID WARSH