[Senate Hearing 109-924]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 109-924
 
                 NOMINATIONS OF HON. JAMES H. BILBRAY,
                      THURGOOD MARSHALL, JR., AND
                           HON. DAN G. BLAIR

=======================================================================



                                HEARING

                               before the

                              COMMITTEE ON
               HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
                          UNITED STATES SENATE


                       ONE HUNDRED NINTH CONGRESS

                             SECOND SESSION

                                 ON THE

 NOMINATIONS OF HON. JAMES H. BILBRAY AND THURGOOD MARSHALL, JR. TO BE 
 GOVERNORS, U.S. POSTAL SERVICE, AND HON. DAN G. BLAIR TO BE CHAIRMAN, 
                         POSTAL RATE COMMISSION


                               __________

                           NOVEMBER 14, 2006

                               __________

        Available via http://www.access.gpo.gov/congress/senate

                       Printed for the use of the
        Committee on Homeland Security and Governmental Affairs



                      U.S. GOVERNMENT PRINTING OFFICE
32-352 PDF                    WASHINGTON  :  2007
---------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government
Printing Office Internet:  bookstore.gpo.gov Phone:  toll free (866)
512-1800; DC area (202) 512-1800 Fax: (202)512-2250 Mail: Stop SSOP,
Washington, DC 20402-0001 



        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

                   SUSAN M. COLLINS, Maine, Chairman
TED STEVENS, Alaska                  JOSEPH I. LIEBERMAN, Connecticut
GEORGE V. VOINOVICH, Ohio            CARL LEVIN, Michigan
NORM COLEMAN, Minnesota              DANIEL K. AKAKA, Hawaii
TOM COBURN, Oklahoma                 THOMAS R. CARPER, Delaware
LINCOLN D. CHAFEE, Rhode Island      MARK DAYTON, Minnesota
ROBERT F. BENNETT, Utah              FRANK LAUTENBERG, New Jersey
PETE V. DOMENICI, New Mexico         MARK PRYOR, Arkansas
JOHN W. WARNER, Virginia

                   Brandon L. Milhorn, Staff Director
                        Asha A. Mathew, Counsel
             Michael L. Alexander, Minority Staff Director
              Kristine V. Lam, Minority Research Assistant
                  Trina Driessnack Tyrer, Chief Clerk


                            C O N T E N T S

                                 ------                                
Opening statement:
                                                                   Page
    Senator Collins..............................................     1
Prepared statement:
    Senator Akaka................................................    21

                               WITNESSES
                       Tuesday, November 14, 2006

Hon. Christopher S. Bond, a U.S. Senator from the State of 
  Missouri.......................................................     1
Hon. James P. Moran, a Representative in Congress from the State 
  of Virginia....................................................     2
Hon. Brian Bilbray, a Representative in Congress from the State 
  of California..................................................     4
Hon. James H. Bilbray to be Governor, U.S. Postal Service........     6
Thurgood Marshall, Jr. to be Governor, U.S. Postal Service.......     7
Hon. Dan G. Blair to be Chairman, Postal Rate Commission.........     7

                     Alphabetical List of Witnesses

Bilbray, Hon. Brian:
    Testimony....................................................     4

Bilbray, Hon. James H.:
    Testimony....................................................     6
    Biographical and professional information....................    28
    Responses to pre-hearing questions...........................    33
    Letter from U.S. Office of Government Ethics.................    39

Blair, Hon. Dan G.:
    Testimony....................................................     7
    Prepared statement...........................................    67
    Biographical and professional information....................    68
    Responses to pre-hearing questions...........................    74
    Letter from U.S. Office of Government Ethics.................    87

Bond, Hon. Christopher S.:
    Testimony....................................................     1

Marshall, Thurgood, Jr.:
    Testimony....................................................     7
    Prepared statement...........................................    41
    Biographical and professional information....................    44
    Responses to pre-hearing questions...........................    56
    Letter from U.S. Office of Government Ethics.................    65

Moran, Hon. James P.:
    Testimony....................................................     2
    Prepared statement...........................................    23

                                APPENDIX

Hon. John M. McHugh, a Representative in Congress from the State 
  of New York, prepared statement................................    22


NOMINATIONS OF HON. JAMES H. BILBRAY, THURGOOD MARSHALL, JR., AND HON. 
                              DAN G. BLAIR

                              ----------                              


                       TUESDAY, NOVEMBER 14, 2006

                                       U.S. Senate,
                           Committee on Homeland Security  
                                  and Governmental Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10 a.m., in room 
SD-342, Dirksen Senate Office Building, Hon. Susan M. Collins, 
Chairman of the Committee, presiding.
    Present: Senator Collins.

             OPENING STATEMENT OF CHAIRMAN COLLINS

    Chairman Collins. The Committee will come to order.
    This morning, the Committee is considering the nominations 
of former Congressman James Bilbray and Thurgood Marshall, Jr., 
to be Governors of the U.S. Postal Service and of Dan Blair to 
serve as Chairman of the Postal Rate Commission. We are also 
very pleased to be joined by the distinguished Senator from 
Missouri, whom I understand has an appointment that starts 
right now, so I am going to defer the reading of my opening 
statement and call upon Senator Bond for the purposes of an 
introduction. Senator Bond.

TESTIMONY OF HON. CHRISTOPHER S. BOND, A U.S. SENATOR FROM THE 
                       STATE OF MISSOURI

    Senator Bond. Madam Chairman, with great thanks and 
apologies, I have been summoned by the Leader for planning for 
the appropriations process, and I do appreciate the chance to 
go forward with introducing Dan Blair at his confirmation 
hearing, realizing that introducing Dan Blair to this Committee 
is a redundancy that is probably unnecessary, but I wanted the 
chance to brag on him for just a moment and his strong Missouri 
roots.
    Born and raised in Joplin, Dan received both his journalism 
and law degrees from the University of Missouri. His mother 
lives in Joplin, and he has close family in Kansas City. His 
wife, Michele, grew up in Kansas City, and in the interest of 
full disclosure, his niece, Amy, is a valued assistant in my 
office. So I do not come to this with a totally impartial view.
    First and foremost, Dan came to work in Washington for my 
very good friend, the late Congressman Gene Taylor, and Gene 
brought Dan to Washington, where Dan worked for him as chief 
counsel on the former Post Office and Civil Service Committee. 
Dan eventually became staff director, and in that job he worked 
on postal reform, which you, Madam Chairman, your Committee, 
and I have worked so hard to move forward.
    Dan's appearance today is a homecoming of sorts since he 
served admirably as former Senator Fred Thompson's senior 
counsel on the Committee for 4 years until the President wisely 
tapped Dan as part of his first-string line-up in 2001. And he 
has been with the Administration since that time as Deputy 
Director of Office of Personnel Management, and he served as 
OPM's Acting Director for 5 months last year.
    He is a well-known friend of the Committee, and when 
confirmed, I know he will bring to his new job a wealth of 
experience, having helped shape postal policy issues during 
most of his career. I cannot imagine a more qualified and 
competent appointee. I applaud his nomination, and I strongly 
endorse the appointment and hope the Committee and the Senate 
will act swiftly to approve this nomination.
    Thank you very much for hearing me, and thank you for your 
courtesies.
    Chairman Collins. Thank you, Senator.
    I am going to excuse Senator Bond now. I know he does need 
to leave, but I want to tell him that his strong endorsement of 
Mr. Blair means a great deal to this Committee. So thank you 
for being here.
    I would like to extend to our two Members from the House of 
Representatives the opportunity also to proceed now since I 
know that you, too, have very busy schedules. And I will 
confess that my staff has not advised me as to who has 
seniority in the House, but I assume that it is Representative 
Moran, so I am going to call on him next. Thank you.

   TESTIMONY OF HON. JAMES P. MORAN,\1\ A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF VIRGINIA

    Mr. Moran. Thank you, Senator. Actually, I think Jim 
Bilbray has seniority.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Moran appears in the Appendix on 
page 23.
---------------------------------------------------------------------------
    Chairman Collins. Good point.
    Mr. Moran. I do appreciate the opportunity to be before 
you, Madam Chairman, and I am particularly pleased to present 
Thurgood Marshall, Jr., to the Committee and to speak in 
support of his nomination to the Board of Governors of the U.S. 
Postal Service.
    I have over 1,400 people in my congressional district that 
work in Postal Service facilities and, of course, have been 
very much pleased to be able to work with the Postal Service 
and its private sector counterparts throughout my career. So 
that is one of the reasons I am particularly excited about Mr. 
Marshall going on the Board.
    After moving to Virginia from New York City, the Marshall 
family has lived in my congressional district for over 30 
years, and the nominee before you this morning and his two 
teen-aged sons have been constituents for most of those years.
    Mr. Marshall is a Northern Virginian, and we take pride in 
that. We first crossed paths when I was a freshman Member of 
the House and he was Director of Congressional Affairs for Vice 
President Gore. And in that position, he managed a team of 
congressional affairs specialists and made himself available to 
members on both sides of the aisle. He was superb in working in 
a bipartisan manner to achieve constructive legislative 
accomplishments.
    He is a quick study, an honest broker, and an intelligent 
and persuasive advocate. He used to be on Speaker Carl Albert's 
staff and served on the staff of three different Senate 
committees. When he was working for the White House, Mr. 
Marshall was sensitive to the concerns that face all of the 
House and Senate Members on legislative issues, and even when 
there was not complete agreement, he would do everything he 
could to be responsive to our concerns. So he is a consummate 
professional.
    Prior to his White House service, Mr. Marshall's experience 
included time spent on the staff of this Committee. That 
brought him in contact with many of the individuals and 
interest groups that regularly interact with the Postal Service 
Board of Governors, and he remained in contact with those 
groups and individuals over the years.
    I have no doubt that Mr. Marshall's door is always going to 
be open to the stakeholders in the Postal Service if he is 
confirmed to the Board of Governors. And I know that his 
commitment to working in a bipartisan manner will serve the 
Board very well. Of course, he comes with valuable experience 
on a number of boards of directors. I am confident that as a 
member of the Board of Governors Mr. Marshall will not delve 
into areas that are the responsibilities of Postmaster Potter 
and the U.S. Postal Service management team, which I know is a 
concern that you do not want people on the Board micromanaging, 
and Mr. Marshall fully understands that.
    His prior membership on other boards of directors has given 
him important experience with issues, though, that involve 
organizational ethics and compliance, performance measures and 
accountability, personnel management, and government 
contracting. And that will serve him very well in terms of his 
oversight responsibilities.
    One final note, Madam Chairman, is to a personal tie that 
Mr. Marshall has to the Postal Service. His grandfather decades 
ago was a postman and sorted mail in Hawaii, on the island of 
Maui. So he has a personal connection, and for all these 
reasons, Madam Chairman, I believe that Thurgood Marshall, Jr., 
is extremely well qualified to become a member of the Board of 
Governors of the Postal Service and, if appointed, will serve 
the Board and the Postal Service with great distinction. So I 
do urge the Committee to give his nomination favorable 
consideration.
    Chairman Collins. Thank you very much, Congressman. We very 
much appreciate your strong endorsement of the nominee and your 
taking the time to be with us this morning to present him.
    Mr. Moran. It was my pleasure. Thank you.
    Chairman Collins. Thank you.
    Congressman Bilbray, you have a familiar last name. It 
sounds quite similar to that of the nominee, and we are very 
pleased to welcome you as well.

 TESTIMONY OF HON. BRIAN BILBRAY, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF CALIFORNIA

    Mr. Bilbray. Thank you, Madam Chairman.
    Madam Chairman, it is an honor to appear before your 
Committee to support the nomination of my cousin, James 
Bilbray, to the Board of Governors of the U.S. Postal Service. 
James' public service goes way back in many fields. He served 
in the Nevada National Guard, and actually his first elected 
position, a lot of people do not know, was as a regent for 
UNLV, University of Nevada, Las Vegas, otherwise known as the 
notorious ``Running Rebels.'' And being a graduate from that 
school and one of the first classes from that school, James was 
very proud to go back as an elected representative in that 
university, that college.
    Let me just say he served in a post as the Deputy District 
Attorney for Clark County, the Las Vegas area, and was chief 
legal counsel to the juvenile court. That is probably why he 
has done so well working with Members of Congress. [Laughter.]
    He also was an alternate judge--there goes your nomination, 
Cousin.
    Chairman Collins. A dangerous comment. [Laughter.]
    Mr. Bilbray. He also was an alternate judge for the City of 
Las Vegas. He served since 1986 in the House of Representatives 
until a period when I was able to relieve him for a short 
period of time, and he is very well respected across the 
political spectrum, Madam Chairman. I think that if you talk to 
anyone who has served with him and has had the pleasure of 
serving with him, even those of us who have had the pleasure of 
being relatives, you will recognize that his performance in the 
past has proven that he is willing to work with everybody and 
anyone if their intentions are well and good.
    He is respected through those political spectrums, and I 
hope that you will consider him for the nomination and give him 
the consideration he deserves, even if he is a Bilbray. 
[Laughter.]
    Mr. James Bilbray. And a Democrat.
    Mr. Mr. Bilbray. Thank you.
    Chairman Collins. Thank you very much, Congressman. It is 
evident that public service runs very deep in the Bilbray 
family, and we are very pleased that you would take the time to 
be here today.
    I know that you, too, have a busy schedule, so I am happy 
to excuse you at this time.
    Mr. Bilbray. Thank you, Madam Chairman.
    Chairman Collins. Thank you. I am now going to resume 
reading my opening statement, which I know you have all been 
waiting for while we diverted for these introductions.
    The Board of Governors of the U.S. Postal Service works in 
many ways like the board of directors of a large corporation. 
The Board selects the Postmaster General and together they 
direct the Postal Service, controlling its expenditures, 
conducting long-range planning, and setting policies on all 
postal matters. The Board's primary obligation is 
representation of the public interest. Fulfilling that 
obligation is a significant responsibility as the Postal 
Service faces increasingly complex policy choices.
    James Bilbray currently serves as a member of the Board of 
Governors. He was nominated on August 1, 2006, to fill the 
remainder of a term on the Board that will expire on December 8 
of this year. At the same time, the President also nominated 
Mr. Bilbray for an additional 9-year term, expiring December 8, 
2015.
    Mr. Bilbray has significant experience serving the public 
interest, as we have already heard from his cousin. I do want 
to add, in addition to his service as a representative of the 
people of Nevada, that he has held various other positions. I 
first got to know the Congressman when he served in 2005 as a 
member of the BRAC Commission. This is tough duty indeed, and I 
found him to be extraordinarily fair-minded as he weighed all 
of the testimony and the evidence that was brought before the 
Commission. And I very much appreciated the seriousness with 
which he approached that important task that had such 
consequences for communities across the United States.
    Thurgood Marshall, Jr., as we have heard, is a practicing 
attorney, and he is a partner with Bingham Consulting Group. 
Mr. Marshall also has a long history of public service from his 
work as a staff member on committees here in the Senate, to his 
service as an assistant to President Clinton. I also want to 
point out that he serves as a member of the Board of Directors 
for Corrections Corporation of America. I point this out 
because this is a very large entity. This business is 
responsible for some 15,000 professionals nationwide, and I 
think that experience as a director on a board of a large 
employer will prove invaluable as the Postal Service faces 
challenges in its workforce composition.
    The third nominee, Dan Blair, is no stranger to this 
Committee. We have worked very closely with him over the years. 
Senator Bond talked about his experience and background on this 
very Committee. I would note that he also served on the House 
Subcommittee on Postal Service, and he has done yeoman's work 
at OPM as well.
    The Postal Rate Commission is an independent regulatory 
agency. Its five commissioners review the requests from the 
Postal Service for new domestic mail rates, fees, and 
classifications. It reviews these requests in public 
proceedings and then makes recommendations to the Board of 
Governors. I would also note that the Commission has the 
authority to propose changes in mail classifications and to 
investigate certain nationally significant complaints of postal 
customers concerning rates, fees, classifications, and 
services.
    The Commission issues advisory opinions in response to 
requests from the Postal Service to change its services in any 
substantial way, and the Commission hears appeals from postal 
customers concerning decisions to close or consolidate retail 
Post Offices. For those of us who represent rural States where 
this is often an issue, that is indeed an important 
responsibility of the Commission.
    The President has nominated Mr. Blair to become the 
Chairman of the Postal Rate Commission for a 6-year term that 
would expire in October 2012.
    Again, I think that the Members of this Committee know full 
well how absolutely vital the U.S. Postal Service is to our 
society and to our economy. Currently, the fiscal status and 
the prospects of further declines in First-Class mail volume 
threaten the national commitment to affordable universal 
service, a commitment that I share with the Board of Governors 
and with the Commission members. These nominees appear to 
possess the knowledge, the experience, and the talent that are 
required to deal with the considerable challenges that lie 
ahead for the Postal Service, so I welcome them to the 
Committee and I look forward to hearing their views this 
morning.
    I would note that each nominee has already filed responses 
to a biographical and financial questionnaire and has answered 
pre-hearing questions submitted by the Committee. They have had 
their financial statements reviewed by the Office of Government 
Ethics. Without objection, this information will be made part 
of the hearing record, with the exception of the financial 
data, which are on file and available for public inspection in 
the Committee offices.
    Our Committee rules require that all nominees give their 
testimony under oath, so I would ask that you each stand so I 
can administer the oath. Do you swear that the testimony you 
are about to give to the Committee will be the truth, the whole 
truth, and nothing but the truth, so help you, God?
    Mr. Bilbray. I do.
    Mr. Marshall. I do.
    Mr. Blair. I do.
    Chairman Collins. Please be seated.
    I would now like to invite the nominees to introduce any 
family members that they have with them. We have already met 
the cousin of Congressman Bilbray. It is my understanding, Mr. 
Blair, that you do have some family members present, so I would 
invite you to introduce them.
    Mr. Blair. I have with me today my wife, Michele Blair, and 
my niece, Amy Blair, and a number of friends in the audience as 
well.
    Chairman Collins. Great. We thank you very much for being 
here today and for your family's commitment to public service.
    I think those are the only family members present, so we 
will now proceed with statements, and we are going to start 
with Congressman Bilbray.

TESTIMONY OF HON. JAMES H. BILBRAY, TO BE GOVERNOR, U.S. POSTAL 
                            SERVICE

    Mr. Bilbray. Madam Chairman, I really don't have an opening 
statement except to thank the Committee for working with me 
through this process and the fact that I believe that, having 
served in Congress, being part of this wonderful institution--
which I guess when you look at what the public thinks about 
Congress, it is a little different than they do. But having 
served here and worked with such wonderful people on both sides 
of the aisle and in both Houses of Congress, I know that this 
is a great institution and one that has served this country 
well.
    I think I can bring a balance and maybe a working 
relationship with the committees on both sides of the aisle and 
both Houses. I know there has been misunderstanding over the 
years between this group. And I think part of it I would like 
to mention in my opening statement is the fact that I remember 
I served on the Advisory Board of the Ex-Im Bank, and the Ex-Im 
Board of Governors--which are full-time, by the way--they felt 
that they could not come down to the Hill and really discuss 
these issues because they thought they were crossing the 
threshold on lobbying. I think that if we could work together 
maybe between the Committee and the members of the Board of 
Governors, we can get past this gray area where the Board of 
Governors can have more input and when things begin, not at the 
end of a particular process so there is no feeling, well, why 
didn't you come forward at an earlier time and talk to us and 
tell us what your concerns were.
    So I am hoping, almost like a liaison situation, where 
hopefully myself and others can work closer with the Committee 
so that we do not get to a position where we have 
misunderstandings on where the Board of Governors stands or 
individual members of the Board of Governors stand and the 
Committee.
    So I am hoping that, like I say, as a former member that I 
can bring something to this Board of Governors that can reach 
out to both the Senate and the House committees to work 
together to have a more efficient U.S. Postal System.
    Chairman Collins. Thank you very much. Mr. Marshall.

 TESTIMONY OF THURGOOD MARSHALL, JR.,\1\ TO BE GOVERNOR, U.S. 
                         POSTAL SERVICE

    Mr. Marshall. Thank you, Madam Chairman. I am honored to 
have been nominated by President Bush on the recommendation of 
Senator Harry Reid, and I am honored to appear before the 
Committee this morning. I am also deeply grateful to my 
Congressman, Jim Moran, for his kind words and for taking the 
time to join us this morning to introduce me.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Marshall appears in the Appendix 
on page 41.
---------------------------------------------------------------------------
    It is a special pleasure to appear before you under these 
circumstances because, as Congressman Moran mentioned, I have 
an important personal family connection to the Postal Service, 
and I have always had great respect for the Postal Service and 
for its employees. Indeed, the opportunity to work on postal 
issues during my tenure working at this Committee was one that 
I savored.
    While I was working at this Committee, I also learned the 
value of dispensing with formal statements, so I would ask that 
my full statement be included in the record, and I look forward 
to your questions.
    Chairman Collins. Without objection. Mr. Blair.

TESTIMONY OF HON. DAN G. BLAIR,\2\ TO BE CHAIRMAN, POSTAL RATE 
                           COMMISSION

    Mr. Blair. Thank you, Madam Chairman. I want to thank you 
for conducting this hearing today. I appreciate the many 
courtesies that you and your staff and Senator Akaka's staff 
and Senator Lieberman's staff have extended to me during this 
process. I also want to thank Senator Bond for introducing me 
today as well and reminding me of my strong Missouri roots.
---------------------------------------------------------------------------
    \2\ The prepared statement of Mr. Blair appears in the Appendix on 
page 67.
---------------------------------------------------------------------------
    I am extremely honored that President Bush would again 
nominate me for a position of public trust, and I greatly thank 
him for the confidence he has shown in me. Chairing the 
independent Postal Rate Commission is indeed a great privilege, 
and it is one that I undertake with great pride, should I be 
confirmed.
    I approach this assignment with a tremendous sense of 
respect and welcome the Committee's support for the well-
recognized independence and integrity that the Commission has, 
and I also note that the Commission has done yeoman's work over 
the past few years making recommendations on the introduction 
of new postal products. I hope to continue that tradition.
    The current Chairman, George Omas, has done a good job in 
reaching out to the postal community and the Board of 
Governors. I plan to build on these efforts, and I look forward 
to working with him and my fellow commissioners as well.
    I have a longer statement that I would ask be included for 
the record, but, again, I greatly appreciate you giving me this 
opportunity to testify today, and I am pleased I was able to 
appear on this panel with nominees Goody Marshall and Jim 
Bilbray.
    Thank you very much.
    Chairman Collins. Without objection, your full statement 
will be included in the record.
    I am going to begin my questioning with standard questions 
that we ask of all nominees.
    First, is there anything you are aware of in your 
background which might present a conflict of interest with the 
duties of the office to which you have been nominated? Mr. 
Bilbray.
    Mr. Bilbray. Madam Chairman, I don't know of anything. I 
served in the Postal Clerks Union when I was in college for 3 
months, but other than that, I don't know of any potential 
conflict I might have. [Laughter.]
    Chairman Collins. Mr. Marshall.
    Mr. Marshall. No, Madam Chairman, I am not aware of any 
conflicts, and my office has established a process to help 
track that in the future.
    Chairman Collins. Mr. Blair.
    Mr. Blair. No, Madam Chairman. I did do an ethics letter 
for the designated agency ethics official, which the Committee 
has on file, and I would recluse myself from any potential 
conflicts.
    Chairman Collins. Second, do you know of anything, personal 
or otherwise, that would in any way prevent you from fully and 
honorably discharging the responsibilities of this office? Mr. 
Bilbray.
    Mr. Bilbray. I don't know of any.
    Chairman Collins. Mr. Marshall.
    Mr. Marshall. I know of nothing.
    Chairman Collins. Mr. Blair.
    Mr. Blair. No, Madam Chairman.
    Chairman Collins. And, third, do you agree without 
reservation to respond to any reasonable summons to appear and 
testify before any duly constituted committee of Congress if 
you are confirmed? Mr. Bilbray.
    Mr. Bilbray. I have no hesitation, even if it is 
unreasonable. [Laughter.]
    Chairman Collins. Mr. Marshall.
    Mr. Marshall. I have no hesitation either.
    Chairman Collins. Mr. Blair.
    Mr. Blair. None whatsoever.
    Chairman Collins. Thank you.
    I am now going to begin the non-standard questions. All of 
you have served on Capitol Hill for a number of years, and I 
have to tell you that I think that is a tremendous advantage. I 
mentioned to Mr. Marshall earlier--and I have talked to 
Congressman Bilbray--that there has been tension between the 
Board of Governors and this Committee, tension that I think 
could have been avoided by earlier and more frequent 
communication. I am pleased to hear your comments, Congressman, 
that this is one of your goals.
    I would like to hear from all three of you how you think 
the Postal Board of Governors in particular, but also the 
Commission, when appropriate--obviously, the Commission is an 
independent regulatory agency and has a different role, a more 
constrained role in terms of communications. But I would like 
to hear each of you address the issue of understanding the 
congressional role in establishing overall postal policy and 
the laws under which you operate. Mr. Bilbray.
    Mr. Bilbray. Well, I think it is generally accepted, the 
fact that the Legislative Branch certainly has oversight and 
helps establish policy for the Board of Governors. In fact, one 
of the things that I have recommended to the Chairman--and I 
also did to other Members that I spoke to last week--was the 
fact I thought we should establish a subcommittee that is just 
basically aimed at working with the Congress. I think, and no 
question in my mind, that the general policy of where the 
Postal Service goes in the future, the Congress is the one that 
sets that policy, and then we carry it out. That may be 
different than some of my colleagues' feelings, but that is 
mine.
    Chairman Collins. Mr. Marshall.
    Mr. Marshall. Well, I certainly have great respect for the 
role that the Legislative Branch plays with regard to oversight 
and policy. I also think that my experience working in and 
around Capitol Hill can be a valuable asset to the Board. It 
has taught me the important role that politics can play in the 
policymaking process. It has taught me the value of taking into 
account constituent needs. And also it has taught me the value 
of polling, messaging, and customer surveys in that process.
    Chairman Collins. Thank you. Mr. Blair.
    Mr. Blair. Well, Madam Chairman, I appreciate the role that 
you see the Commission playing, and I approach this from the 
perspective that clear, open, and regular communications 
between the regulator and the Congress is essential if the 
regulator is going to accomplish the role that you expect of 
it.
    Having come from Capitol Hill, you understand that the 
Commission implements the policy that the policymakers enact, 
and understanding the congressional intent in specific areas, 
understanding congressional concerns certainly go far in 
helping the regulator effectively perform its role.
    Chairman Collins. Mr. Blair, in your roles as both the 
Deputy and the Acting Director of OPM, you have testified 
before this Committee twice on the subject of postal reform, 
and both times you presented the Administration's case very 
strongly for making the Postal Service the sole agency that 
would be responsible in the Federal Government for 
retroactively assuming the responsibility for the Civil Service 
Retirement System pension costs related to its employees' 
military service. I am sure that you remember that testimony, 
perhaps not fondly. [Laughter.]
    After 3 years of extensive debate on this issue, in July, 
as part of an extraordinary effort to advance postal reform, 
the Administration, to its great credit, agreed to revise its 
position on that issue and that the entire military pension 
obligation should indeed be returned to the Department of the 
Treasury, as I had long advocated and as Senator Carper had 
long advocated.
    To what extent, if any, were you involved in the 
Administration's final decision on this issue?
    Mr. Blair. Well, I think that there were internal 
discussions going on at all points during the process, but I 
believe that it was important for the Administration in 
reviewing the overall package of postal reform to determine 
that, in order to move it forward some parties would have to 
give, some parties would have to take. And at that juncture, it 
was most important that the budgetary hit be minimized as much 
as possible.
    Recognizing that the Administration took a very strong 
position on that end, I think it is to the Administration's 
credit in pushing forward the postal reform debate that we saw 
an effort to compromise in order to move the bill forward, and 
that the Administration wants to see comprehensive postal 
reform enacted.
    Chairman Collins. And as I said, I really credit the 
Administration with continuing to work with us. I have had 
numerous meetings with White House officials, and I am really 
pleased that those meetings have been so constructive and 
produced such good results. Unfortunately, despite 3\1/2\ years 
of work by Senator Carper and myself, success in crossing the 
finish line has proven far more elusive than we ever would have 
imagined.
    If, however, as we hope, postal reform is enacted before 
the end of the year, the Commission will have a very heavy 
agenda for 2007. You will be charged with implementing an 
entirely new ratemaking process while deliberating on a pending 
rate case during the first quarter of the year.
    As the new Chairman, how would you prepare yourself to deal 
with that very heavy agenda?
    Mr. Blair. It is a heavy agenda, and it is one that the 
current Commission has been contemplating and working on. I 
understand that there have been working groups formed at the 
Commission. But I want to make sure that, if confirmed, once I 
go down there to properly analyze and explore to what extent 
the resources are available to carry out this mission, to make 
sure that we have those in place because the Commission is 
going to undertake a tremendous new role and will want to make 
sure that we meet the congressional intent in assuming those 
responsibilities.
    I have no doubt in my mind that we can undertake it. Ever 
since the process of postal reform first began, it was 
contemplated that in giving great new flexibilities to the 
Postal Service, Congress would also have to balance those with 
an empowered new regulator. And I think that Congress is doing 
the right thing in proposing that in its legislation, and I am 
ready, if confirmed, to tackle those new problems. And I would 
look forward to it.
    Chairman Collins. Do you believe that the Commission at 
present is adequately staffed and has sufficient resources to 
take on these new responsibilities?
    Mr. Blair. I would have to get down there to look at the 
staffing levels and determine if we have the right mix of 
skills available down there, if we have the right people with 
the right kind of talent. So I want to reserve judgment before 
I get down there, but I think given the new role for the 
Commission, it certainly envisions a more robust entity than 
what it is now, given that its new responsibilities are going 
to be much greater. And I think that going into that with my 
eyes wide open and realizing where Congress wants it to go 
would be a great benefit.
    Chairman Collins. Mr. Bilbray and Mr. Marshall, the 
Collins-Carper postal reform bill is designed to foster more 
efficient postal operations by giving the Postal Service much 
more flexibility than it has now to set its own prices and to 
implement revised operating procedures. For market-dominant 
products, the average increase for each class of mail would be 
capped at the level of the CPI. A key assumption is that the 
level of services provided by the Postal Service will remain 
sufficient to meet the personal and business needs of the 
public. A major concern of mailers is that when the Postal 
Service projects that its costs are likely to increase faster 
than inflation during some period of time, it might decide to 
balance its budget by cutting services instead of by 
implementing more efficient operating practices. Our bill 
attempts to avoid that undesirable outcome by requiring the 
Postal Service, in consultation with the Postal Rate 
Commission, to develop and define service standards.
    Do you agree with the recommendation, the provisions in 
this bill, that the Postal Service should establish service 
standards, performance goals, and report those on a regular 
basis on the Postal Service's website so that your customers, 
the Congress, and all interested parties can monitor the Postal 
Service's performance? Mr. Bilbray.
    Mr. Bilbray. Having served on the Board now for 3 months--
this is my second meeting, actually, after being confirmed, 
this has been discussed, and I didn't see and didn't feel a lot 
of opposition, and I didn't feel opposition to this particular 
point.
    One point, Madam Chairman, that I think was a concern is 
the cap--not the cap on the inflationary rate, but for each 
class. I know that the discussion has been that we--and I have 
asked for an opinion or an analysis of all classes, are they 
carrying their own load. And there is a feeling that there may 
be some classes within the Post Office that are maybe even 
losing money and that, if we cap that at the CPI, maybe the CPI 
should be across the whole board. In other words, the entire 
raise cannot be more than the CPI. But there might be some sub-
classes within the overall Post Office that might have to be 
raised higher to bring them equal.
    An example of that is--and I have not got the figures yet 
because it has not been provided to me yet--newspapers and 
magazines, that there is some feeling within the Administration 
of the Post Office that may be losing money and that we would 
never be able to catch up if each class is capped with the CPI.
    I have not seen the figures yet, so I don't know if that is 
correct or not. But those are the kind of things that are of 
concern. But reporting to Congress and reporting to the public 
what we are doing in each area is not an objection of mine, and 
I think the public right to know is more important than the 
privacy of the system.
    Chairman Collins. Mr. Marshall, what are your views on the 
idea of having service standards that would be published and 
available to the public?
    Mr. Marshall. I believe the Postal Service should provide 
customers with useful and timely data regarding service 
standards and guidance as to whether those standards have been 
met. I understand that the Postal Service is responsive to the 
Government Performance and Results Act (GPRA), and I would 
expect the Board of Governors to play a role in matching those 
standards, consistent with the GPRA process, and applying those 
standards to postal management and postal practices.
    I recall that during President Clinton's Reinventing 
Government Initiative there were only three agencies that first 
stepped to the plate and offered to make performance standards 
public, and the Postal Service was one of those three agencies. 
And I think that speaks well to its willingness to make those 
standards available to the public in a timely manner.
    Chairman Collins. I want to turn to the issue of labor 
relations. This has been a longstanding postal issue, the need 
to improve labor-management relations within the Postal 
Service. Obviously, if anyone looks at the Postal Service, you 
see that a great deal of the costs are personnel related. You 
would expect that given the mission of the Postal Service.
    Congressman Bilbray, I am actually happy to learn that you 
were a member of the postal union when you were in college for 
a short time because maybe you will bring some extra 
credibility to dealing with that issue. But is there anything 
in particular that you think the Postal Service should be doing 
to encourage and facilitate greater cooperation between postal 
managers and the postal unions? Mr. Bilbray.
    Mr. Bilbray. I have not--and, of course, I have talked to 
members, the heads of the different postal unions, the 
Postmaster General, his assistant. I was not aware that there 
is really any problem right now. They seem to like each other. 
The Postmaster General comes out of the system. He is not a 
newcomer into it. But, again, I have only been there for one 
meeting, the last meeting, and have not had time since I have 
been on the Board to really sit down and discuss this issue 
with members of the union as well as the Postmaster, except the 
fact they are just beginning, I guess, negotiations starting 
next week, and I think we will get a good feeling of how those 
negotiations are going. But I think good relations with labor--
and I have always had a good relationship, even as a 
Congressman, with labor. And I really think that they are the 
backbone of our business. And so I feel a happy postman is a 
good postman. So I am hoping that improves.
    Chairman Collins. Also, having dealt extensively not only 
with the unions but the Postmasters' associations, there is a 
lot of expertise there. There is a lot of wisdom in these 
groups, and I think most--not all, but most of the leaders of 
those groups recognize that the stakes are very high and they 
want the Postal Service to be a strong, economically viable 
institution that can continue to serve our country for 
centuries into the future.
    So I think the more outreach that can be done, the better. 
I realize it is difficult during labor negotiations, perhaps, 
to have those kinds of discussions, but that is something I 
would urge.
    Mr. Marshall.
    Mr. Marshall. Well, as with any longstanding institutional 
relationship, particularly one with such a long and storied 
history, I suspect that in this instance an additional set of 
eyes and ears, particularly those of an independent member of 
the Board of Governors, can be valuable. And so I would hope 
that those of us who have an opportunity to serve on the Board 
of Governors will be able to help to encourage a cooperative 
spirit and to provide guidance, taking into account what we are 
able to pick up through those independent eyes and ears.
    Chairman Collins. I think there is still work to be done in 
this area, and as evidence of that, I would share a personal 
experience where the Maine congressional delegation was 
recently invited to the opening of a new postal facility in 
southern Maine. We arrived to find an informational picket in 
place where members of the Postal Workers Union were picketing 
over what they felt were unfair schedule changes, adverse 
working conditions, and some safety concerns.
    Needless to say, that took the celebration out of what was 
supposed to be the celebration of a state-of-the-art new 
facility, and the members of the delegation, including myself, 
decided not to participate.
    I felt bad that those issues could not have been worked 
through earlier and that there was not better communication 
between the local managers and the union representatives. But 
as I will share with you, I have found that, for the most part, 
all of the various associations, whether it is the postal 
supervisors or the postmasters or the various--the Mail 
Handlers Union, the rural letter carriers, the letter 
carriers--I am undoubtedly forgetting one, but there are so 
many of them, and for the most part--there are always 
exceptions, but for the most part, they really care about 
sustaining the Postal Service for the future and working 
together, and they understand the need for legislation as well.
    One of the major challenges is, of course, the decline in 
First-Class mail volume. This is a dangerous decline given how 
important First-Class mail is to support the institutional 
costs of the Postal Service, and, unfortunately, we see the 
Postal Service in a continuing decline as people turn more and 
more to the Internet for bill paying and for other services.
    Declining First-Class mail volume reduces the revenue 
available to pay for institutional costs and places upward 
pressure on postal rates, which in turn leads to further 
reductions in First-Class mail volume.
    I think this needs to be a primary focus of the Board, and 
I realize you are both just getting into these issues. But, Mr. 
Bilbray, we will start with you since you are on the Board, 
albeit a new member. Are there ways that the Postal Service can 
reduce this very disturbing trend?
    Mr. Bilbray. Well, I think there are a couple. One is we 
are looking at new businesses within the purview of the postal 
system. The Postmaster General has said at the last meeting 
that we really have not done the job on international mail that 
we should. International mail could be a real profit center for 
the Post Office, and I think if we adjust it as we go along and 
find other areas within the job description of the postal 
system that we can help by bringing revenue up there, it would 
take the pressure off First-Class mail. Because I agree with 
you, I think First-Class mail is not only--I just do not see 
any increase in the percentage of it. I think it is going to go 
down. And, again, the worst thing when you are out--I mean, 
everybody that knows I am on the Board of Governors now, the 
first thing anybody says to me, ``Don't increase my First-Class 
mail.'' They don't call it ``First-Class,'' but I know what 
they mean when they say ``mail.'' And I tell them about the 
proposal of forever stamps. Maybe this kind of pacifies them a 
little bit. But it is a sore spot with the general public, and 
we know that, and it causes more decrease.
    The other thing is, of course, more efficiency, and a lot 
of it is done through automation, and some of the new 
automation programs really--we have reduced--the Post Office 
has reduced over 100,000 employees over the last 10 years with 
more efficient systems. There is not a lot more to give, but 
there will be more that will go down unfortunately, and I don't 
think any postman or clerk or mail handler will ever be 
replaced at this point, but they will be replaced by attrition, 
and we get the cost of the service down.
    But, again, new products like an increase in international 
mail, people kind of look to the Post Office, and they go with 
FedEx or DHL, and they go with these other companies because 
they think that they can have a better delivery system, get it 
there faster.
    We are cheaper. We can do it as well as they can. And as 
people become aware of this, I think we can increase our 
revenues for the Post Office and keep the costs down, and 
hopefully we won't have continually this spiral of First-Class 
mail, which is, again, as you increase the price, you reduce 
the volume and it keeps going down.
    So I think that I am very impressed with the Administration 
of the Post Office itself, the Postmaster, his assistants, and 
the people around him. And they are very innovative, and I 
think that we are going to have to work on this over the years 
to keep the price down. And hopefully when I tell people, the 
Postal Commission, those dirty guys over there, they are going 
to raise it to 42 cents, it is not us, it is them.
    Mr. Blair. Thank you. [Laughter.]
    Mr. Bilbray. They really get a little excited about it. 
Let's put it that way.
    Chairman Collins. Thank you. Mr. Marshall.
    Mr. Marshall. Madam Chairman, I believe that the bottom 
line is that the decline in First-Class mail volume absolutely 
needs to be addressed, not solely because a huge portion of the 
Postal Service's institutional costs are offset by First-Class 
mail, but also because high-quality First-Class mail service 
has been a hallmark of the Postal Service and has been a 
significant reason that the Postal Service has engendered such 
confidence from our citizens.
    We are all acutely aware that the challenge is made all the 
more difficult by the national security challenges that the 
country faces, and as I stated in my prepared remarks, I would 
hope that the Postal Service can receive budgetary assistance 
on security issues, particularly research and development 
regarding the bioterror threat and related threats.
    Chairman Collins. Thank you.
    All three of you answered some questions in the pre-hearing 
questionnaire about Post Office closings. One area that is of 
particular interest to the general public and to the Congress 
is the transparency of those issues. Do you feel that it is 
appropriate for the Postal Service to be as transparent as can 
be about which Post Offices and postal facilities it plans to 
close and the reasons for closing them? Do you also feel that 
it is appropriate for the Postal Service to develop and publish 
standards that it plans to use to determine which facilities to 
close? Mr. Blair.
    Mr. Blair. I have never heard a good argument against 
transparency. I think it is always important for a government 
institution to be as transparent as possible so that the public 
has a right to know and understands what it is doing. 
Developing clear guidelines in this area and adhering to them I 
think would go a long way toward solving the confusion that 
surrounds this area.
    There is a clear statutory area in the closing of Post 
Offices, but with leased and rental facilities it gets much 
murkier. And for some communities, the leased or rental 
facilities are the only retail outlet they have. And so I think 
transparency and giving what the clear guidelines are that the 
community can follow would be helpful.
    Chairman Collins. Mr. Marshall.
    Mr. Marshall. I understand that the Postal Service has 
recently implemented a public meeting process during its 
efforts to consolidate mail processing facilities, and I 
certainly believe that is an important and valuable step. I 
also recognize that what is called for is a two-way dialogue in 
the process, and so I believe that providing standards for 
public analysis is an important step toward transparency.
    I would also expect the Board of Governors to receive 
regular briefings and consultation on service measurements and 
consolidation options and to work closely with management in 
analyzing how those compare.
    Chairman Collins. Mr. Bilbray.
    Mr. Bilbray. Closing anything is tough, as I knew in the 
2005 BRAC Commission. One of the things that, of course, I 
thought was very effective was the fact that many of us 
traveled to different facilities and met with the people, saw 
the facilities. As the Senator well knows, the Pentagon did a 
miserable job on doing their part of the BRAC, in many cases we 
found out that no one had ever visited the facilities; in fact, 
the Pentagon admitted that in some places they Googled the 
information and decided to close a certain facility.
    Nothing, I think, when you go to the Post Office system, 
when you go out to the rural areas in Nevada, Utah, and those 
areas, that little rural Post Office is as important to them as 
the big metropolitan Post Office in the middle of a big city.
    I know that the Board and the Chairman have encouraged 
people visiting and members of the Board going out to some of 
these areas before we close. And I think we should do more of 
that to allow local input. And I know that you can look and say 
there is a little Post Office in Lamoille, Nevada, and it is 
20, 30 miles from Elko. And it is not cost-efficient. It costs 
us money to run that facility. It does not take care of itself. 
But to the people around Lamoille and Elko County, that is an 
important facility. In the middle of winter to drive, it is 
like Maine, driving 30 miles in the snow and the bad weather to 
do certain things, to a Post Office, is tough.
    The problem, we have a part-time Board, and it sometimes 
gets very difficult. We come almost every month to Washington 
to meet on these issues. To get members to go off to Point A, 
Point B, Point C to meet with people is tough. But we have got 
to do more of that, and it may be one of the reasons that we do 
not do as much and we do not meet as much as we possibly can is 
somebody told me at the Post Office that we reach a Hatch Act 
situation where we are all political appointees, but when you 
have so many meeting dates and you do so many things, even if 
we are only paid up to--what?--40 meetings. But if you reach 
over a certain limit, you reach the Hatch Act, and you cannot 
do that anymore. It might be something we might want to adjust 
down the line because I think it is important that we reach 
out.
    In your facility, Portsmouth, New London, these kind of 
things, probably without a BRAC Commission that went out and 
looked at it, and if just the Pentagon could do it, those 
facilities probably would have been closed by the information 
just provided by the Pentagon in both those facilities. But as 
BRAC Commissioners went out and looked at these facilities, saw 
the need, saw the errors that were made in the projections by 
the Pentagon, we reversed those decisions, as you well know. 
And we did that across the country in many cases, even though 
we backed about 80 percent of the Pentagon recommendations.
    I think we need to do something similar here where we can 
talk to people in Lamoille and find out, yes, it is not 
profitable to keep this facility open, but, on the other hand, 
there is something beyond economics when it comes to these 
rural Post Offices. And I imagine Maine has that problem worse 
than many States because of the winter weathers and inability 
to go to the bigger cities and do your postal business.
    Maybe we can come up with more efficient ways, but those 
little rural postmasters are sometimes the key in a community. 
I know my great aunt in Louisiana back in the early 1900s was 
the postmaster of Ethel, Louisiana, and she was kind of a 
center of the community. She was also the midwife, too. But 
these are important situations, and I am very hesitant to close 
rural Post Offices because I think they are the backbone of the 
postal system. But I imagine some have to be closed. I don't 
think we will ever have a BRAC Commission for the Post Office 
system, but we can certainly get more involved, and maybe we 
need to work together with the Committee to find out how we do 
more meetings, how we go out and do these kind of things 
without crossing a threshold that puts us into a situation 
because--of course, I have got so many friends running for the 
Democratic nomination for President right now, I wish I was 
limited by the Hatch Act.
    Chairman Collins. Thank you. It is obvious that you 
understand that issue very well, and I love that your relative 
both could deliver babies and deliver the mail. [Laughter.]
    But that is an important issue. A lot of times the rural 
Post Office also is the town center. It is what brings people 
together. And I do have a deep appreciation, representing a 
large rural State, of how important those rural Post Offices 
are. So I very much appreciate your comments on that.
    Mr. Marshall, I want to switch to one final issue, and I 
touched on this issue when we met in my office. The Postal 
Service has occasionally been criticized for offering products 
or services that are not directly related to the delivery of 
mail. And photocopying is one example, passport photo taking is 
another; postal money orders is a third; selling cards or 
wrapping materials is yet another example.
    This is a difficult issue because in some very rural areas, 
the Post Office may have the only photocopier available for 
miles, and it is a real public service that you can go to the 
local Post Office and get something copied and pay a modest 
fee.
    On the other hand, in other communities you have small 
businesses that are available, willing, and able to provide 
these services, and they do not like the idea of having to 
compete with the Postal Service, which has, obviously, some 
competitive advantages and has a monopoly on First-Class mail, 
and it creates an unfair playing field for a small business 
that is trying to compete with the same service.
    What are your thoughts on how the Postal Service can strike 
the appropriate balance and not unfairly compete with small 
businesses?
    Mr. Marshall. Well, this is certainly an issue that I want 
to study further. I am interested in learning how the Postal 
Service's private sector competitors have lined up their 
product lines. I am also interested in learning more about the 
Postal Service's product lines, usage, and costs associated 
with what they are engaged in with their product lines. And I 
am interested in customer survey data.
    In light of my discussions with you, Madam Chairman, I am 
also very sensitive to the impacts that any such decisions 
would have on small businesses. I certainly recognize that, as 
Governor Bilbray has mentioned and as you schooled me on our 
visit, Post Offices do indeed serve as community focal points 
in many jurisdictions. And to the extent that there is a 
sliding scale that could be imposed in terms of the degree to 
which those services may be heavily relied upon in certain 
communities but less so in others, hopefully a balance point 
can be achieved on that sliding scale that takes those 
sensitive issues into account, so that services can be provided 
where appropriate, but businesses and local small business 
efforts are not threatened.
    Chairman Collins. Thank you. Mr. Blair, what are your 
thoughts on that issue?
    Mr. Blair. Well, I think you eloquently stated the 
balancing between a large governmental entity which in some 
people's view would have the ability to cross-subsidize 
competitive services versus the ability of government to 
provide a basic service when it cannot be provided by the 
private sector.
    I think what you want to do is--how do you strike that 
balance? I think that you have to look at it over a period of 
time. Maybe it is something that the Postal Service introduces, 
and then as the private sector enters the market, it slowly 
withdraws. I do not have an easy answer for you at this point, 
but you certainly recognize the public policy implications that 
the Postal Service competing with the private sector bring to 
the forefront. That was something that was struggled with in 
the original postal reform bill. I know that your postal reform 
bill addresses that the U.S. Postal Service will be only 
offering postal services. Sometimes when you cut the baby in 
half, neither party is completely satisfied, and it doesn't 
satisfy all parties. But recognizing the breadth and scope of 
the Postal Service and its ability to impact communities, both 
positively and negatively, I think that your approach in H.R. 
22 took the right tack.
    Chairman Collins. Thank you. Mr. Bilbray.
    Mr. Bilbray. I laugh at a story when I was in Congress. You 
know how sometimes we provide flags that have flown over the 
Capitol? I remember getting a letter from a couple of 
businesses that I should stop doing that because I was 
interfering with their selling of flags at their business. The 
same thing here in the Post Office. The fact is when I walk 
into a Post Office, I like the idea that you can buy the boxes, 
you can buy the packing material, you can buy the paper. I 
think these are related items to the Post Office. In some Post 
Offices, you can get passport pictures, and in my case, I can 
go down to the corner to the CVS or the Walgreen and get 
passport pictures. But in some communities you can't.
    I think you have got to be very careful in trying to 
interpret what are Post Office-related businesses. And I think 
that what I have seen in the Post Office when I go into the 
Post Office, boxes that fit my package, I will come in, ``You 
got a box that will fit it?'' I don't think it is a real 
conflict with small business. I understand if you go down to 
the Post Office to get boxes, there is a place by the 7-Eleven 
down at the corner, and if you want to buy it down there and 
you want to package it down there, it costs about twice as much 
as if you went to the U.S. Post Office, and I am sure those 
kind of businesses would like to see us get out of the boxing 
and the packaging and the wrapping and so forth because they 
have to make a profit. But it is very much more expensive, and 
I think most of my people in my district, especially seniors, 
would rather go to the Post Office and get what they consider a 
reasonable deal and a full-service Post Office where they can 
help them package, and the people are very accommodating, help 
you find the right size box, the right size bubble wrap, and so 
forth.
    So maybe I am just not as concerned as my colleagues are 
about our competition because if we want to keep First-Class 
mail down, we have got to expand into areas that are related. 
And I think what the problem is going to be here with the 
Committee, and maybe some others, is what is Post Office-
related business. To some people, some of the stuff we do, it 
maybe is not. But I think it is related to the Post Office, and 
I think it is a service we provide to the public.
    Chairman Collins. I think that is going to be an ongoing 
debate, and I very much appreciate hearing your insights on it.
    I want to thank all of the nominees for appearing here 
today and for your willingness to serve. The Postal Service is 
such a vital institution to this country, and I think it is 
absolutely vital that we have highly qualified individuals on 
the Board of Governors, on the Postal Rate Commission, and I 
believe that the President has chosen very well in sending your 
nominations before this Committee. So based on what I have 
heard today, I look forward to supporting all three of you and 
quickly advancing your nomination to the full Senate. It is my 
hope that the Committee will be able to favorably report you 
later this week and that we can encourage the full Senate to 
confirm you shortly thereafter.
    Without objection, the hearing record will be kept open 
until noon tomorrow for the submission of any written questions 
or statements for the record. Should there be any additional 
questions, I would encourage you to turn those around very 
rapidly because the Committee cannot vote to report you until 
we get your answers back to any additional questions.
    I do not expect, judging from the widespread participation 
in this hearing this morning, that there will be a great number 
of questions. Again, thank you for your service, both past, 
present, and future.
    This hearing is now adjourned.
    [Whereupon, at 11:05 a.m., the Committee was adjourned.]
                            A P P E N D I X

                              ----------                              


                  PREPARED STATEMENT OF SENATOR AKAKA
    Thank you very much, Madam Chairman. I join you today in welcoming 
our distinguished nominees, who I believe exemplify the best in public 
service. I also welcome their families and friends to the Committee 
this morning. And of course I welcome our Congressional colleagues who 
have introduced our nominees.
    I am pleased to be acquainted with all three of these fine 
individuals. Mr. Bilbray and I knew one another in the House, and Mr. 
Marshall, whose mother is from Maui and a friend of mine, can be called 
a son of Hawaii. I am pleased to have worked with Mr. Blair in his 
capacity as Deputy Director of the Office of Personnel Management.
    I believe all three nominees have the professional experience and 
qualifications to serve in the positions to which they have been 
nominated. They understand that sound management is key to the vitality 
of the U.S. Postal Service, and they share my belief that effective 
management demands accountability and transparency.
    That is why I look forward to working with them, if confirmed, in 
meeting the challenges and opportunities facing the Postal Service.
    I urge Mr. Blair, who will be Chairman of the Postal Rate 
Commission, to continue the gains made by the current PRC Chairman 
George Omas in creating an open environment and maintaining good 
relations with the Postal Board of Governors. I also urge Mr. Bilbray 
and Mr. Marshall to be independent and to express their opinions on how 
the Postal Service should be run today and in the future.
    Thank you, Madam Chairman. I look forward to moving these 
nominations quickly. I wish all three of you well. You may be assured I 
support acting on your nominations quickly.
[GRAPHIC] [TIFF OMITTED] 32352.001

[GRAPHIC] [TIFF OMITTED] 32352.002

[GRAPHIC] [TIFF OMITTED] 32352.003

[GRAPHIC] [TIFF OMITTED] 32352.004

[GRAPHIC] [TIFF OMITTED] 32352.005

[GRAPHIC] [TIFF OMITTED] 32352.006

[GRAPHIC] [TIFF OMITTED] 32352.007

[GRAPHIC] [TIFF OMITTED] 32352.008

[GRAPHIC] [TIFF OMITTED] 32352.009

[GRAPHIC] [TIFF OMITTED] 32352.010

[GRAPHIC] [TIFF OMITTED] 32352.011

[GRAPHIC] [TIFF OMITTED] 32352.012

[GRAPHIC] [TIFF OMITTED] 32352.013

[GRAPHIC] [TIFF OMITTED] 32352.014

[GRAPHIC] [TIFF OMITTED] 32352.015

[GRAPHIC] [TIFF OMITTED] 32352.016

[GRAPHIC] [TIFF OMITTED] 32352.017

[GRAPHIC] [TIFF OMITTED] 32352.018

[GRAPHIC] [TIFF OMITTED] 32352.019

[GRAPHIC] [TIFF OMITTED] 32352.020

[GRAPHIC] [TIFF OMITTED] 32352.021

[GRAPHIC] [TIFF OMITTED] 32352.022

[GRAPHIC] [TIFF OMITTED] 32352.023

[GRAPHIC] [TIFF OMITTED] 32352.024

[GRAPHIC] [TIFF OMITTED] 32352.025

[GRAPHIC] [TIFF OMITTED] 32352.026

[GRAPHIC] [TIFF OMITTED] 32352.027

[GRAPHIC] [TIFF OMITTED] 32352.028

[GRAPHIC] [TIFF OMITTED] 32352.029

[GRAPHIC] [TIFF OMITTED] 32352.030

[GRAPHIC] [TIFF OMITTED] 32352.031

[GRAPHIC] [TIFF OMITTED] 32352.032

[GRAPHIC] [TIFF OMITTED] 32352.033

[GRAPHIC] [TIFF OMITTED] 32352.034

[GRAPHIC] [TIFF OMITTED] 32352.035

[GRAPHIC] [TIFF OMITTED] 32352.036

[GRAPHIC] [TIFF OMITTED] 32352.037

[GRAPHIC] [TIFF OMITTED] 32352.038

[GRAPHIC] [TIFF OMITTED] 32352.039

[GRAPHIC] [TIFF OMITTED] 32352.040

[GRAPHIC] [TIFF OMITTED] 32352.041

[GRAPHIC] [TIFF OMITTED] 32352.042

[GRAPHIC] [TIFF OMITTED] 32352.043

[GRAPHIC] [TIFF OMITTED] 32352.044

[GRAPHIC] [TIFF OMITTED] 32352.045

[GRAPHIC] [TIFF OMITTED] 32352.046

[GRAPHIC] [TIFF OMITTED] 32352.047

[GRAPHIC] [TIFF OMITTED] 32352.048

[GRAPHIC] [TIFF OMITTED] 32352.049

[GRAPHIC] [TIFF OMITTED] 32352.050

[GRAPHIC] [TIFF OMITTED] 32352.051

[GRAPHIC] [TIFF OMITTED] 32352.052

[GRAPHIC] [TIFF OMITTED] 32352.053

[GRAPHIC] [TIFF OMITTED] 32352.054

[GRAPHIC] [TIFF OMITTED] 32352.055

[GRAPHIC] [TIFF OMITTED] 32352.056

[GRAPHIC] [TIFF OMITTED] 32352.057

[GRAPHIC] [TIFF OMITTED] 32352.058

[GRAPHIC] [TIFF OMITTED] 32352.059

[GRAPHIC] [TIFF OMITTED] 32352.060

[GRAPHIC] [TIFF OMITTED] 32352.061

[GRAPHIC] [TIFF OMITTED] 32352.062

[GRAPHIC] [TIFF OMITTED] 32352.063

[GRAPHIC] [TIFF OMITTED] 32352.064

[GRAPHIC] [TIFF OMITTED] 32352.065

[GRAPHIC] [TIFF OMITTED] 32352.066

                                 
