A Grand Alliance: Anti-Privatization and the Postal Service

by Sheryl Hamlin

The second day of the three day webinar on Saving the US Postal Service was dedicated to Postal Financial Services.

The keynote speakers were Dave Ward, CWU, UK and Donald Cohen from In the Public Interest. The moderator was Chastity Murphy from The Appeal.

Dave Ward who specializes in postal logistics said that this is the moment for trade unions to safeguard jobs and to innovate. Postal workers, he said, kept towns connected during Covid. Postal workers are trusted by the community so would be effective as financial stewards. Defeating Trump’s privatization plan was a success, he said, but now they must deliver a “New Deal” for America.

Donald Cohen from In The Public Interest has written a book “The Privatization of Everything” and feels the lessons from other industries are relevant to the United States Postal Service (USPS). Outsourcing in areas such as school vouchers, prisons, social services, water and wastewater services, Medicaid are sold under the promise that private companies do it better, cheaper and faster, but they create low paying jobs with no pensions and less quality. And what happens to the savings? He suggested the savings fund CEO salaries, dividends and acquisitions of other companies. Not discussed was the municipal bond industry who facilitates these deals and costs the public agencies millions in fees. He suggested that there are two types who are for privatization: 1) the anti-union, anti-government types and 2) the free market idealogues who believe you only get what you pay for.

Privatization, says Cohen, is an assault on democracy. He cited the well known abuses in the private prison industry who lobby for strong sentencing and demand bed guarantees in their contracts.

Cohen said that one third of water and wastewater services are privately owned and operated. American Water, for example, warns of the conservation of water so their revenues would be reduced. PPP or Public-Private-Partnerships is a code word for privatization.

Virtual charter schools for public education lobby against class size restrictions, because in their environment a class can be unlimited in size.

POSTAL FINANCIAL SERVICES

The panel for this segment was Raul Carrillo, Yale Law School, Rakim Brooks ACLU strategist racial justice, and Porter McConnell “Take on Wall Street” . Each panelist addressed the need for and the potential for expanded postal financial services in the U.S.

As a legal scholar, Raul Carillo had much to say about privacy and banking legislation. He said there was pilot legislation for banking which included money transfers, check cashing, Direct Express Card and Social Security benefits. Representative Waters included Postal Banking in the CARES Act. Federal Reserve has proposed a bank account to everyone including small businesses. He said that the Fed already offers accounts to banks at a certain level. He did not mention that this was to facilitate a bank’s ability to meet its reserve levels. See point 4 in this article. There is a good discussion of retail FedAccounts in this article, which have not been put in place yet.

Privacy is a major concern in the all banking situations whether private or federal. The government can track any and all transactions. He explained the difference between a bank account, which is trackable, and a digital wallet, where only the owner can see its contents. Both would be necessary in his opinion. The fear would be a partnership with Amazon in a postal banking pilot. Privacy is a civil rights issue. A app for USPS on a phone is nothing but a data harvester for the app developer.

Rakin Brooks, ACLU, said that the USPS saved democracy on January 6, 2021 without elaborating. He referenced the book “The Color of Money” and said that 50% of black Americans were under-banked. Check cashing services and Pay Day loans charge exorbitant fees. After the Great Financial Crisis, thousands of bank branches were closed, thus exacerbating the under-banking population.

Brooks referenced Alexis de Toqueville who wrote about American culture during his travel in the early 19th century. One well-quoted story is about the cohesiveness brought on by communication:

By 1800, nearly 21,000 miles of postal routes connected Americans living in disparate climates and economies – from Sandy Point, Maine to Natchez, Mississippi. Just a generation later, French statesman Alexis de Tocqueville marveled at the reach of the post service, writing that there was “no French province in which the inhabitants knew each other as well as did the thirteen million men spread over the extent of the United States.”

Brooks also pointed out that the USPS provided banking services at one time. This SLATE article is an excellent history.

Source:Porter McConnell presentation

Porter McConnell described the “Save the Post Office Coalition” . The question was posed why President Biden has not replaced Postmaster Dejoy. Read why here. But, Biden has nominated three to serve on the formerly vacant Postal Board of Governors.

The video will be available here.

The Day 1 report may be read here.

To read more about the author click sherylhamlin dot com