[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]

                             POSTAL UPDATE



                               BEFORE THE


                                 OF THE


                        HOUSE OF REPRESENTATIVES


                             SECOND SESSION


                           SEPTEMBER 14, 2020


                           Serial No. 116-117


      Printed for the use of the Committee on Oversight and Reform

                       Available on: govinfo.gov,
                         oversight.house.gov or

41-956 PDF             WASHINGTON : 2020                              

                CAROLYN B. MALONEY, New York, Chairwoman

Eleanor Holmes Norton, District of   James Comer, Kentucky, Ranking 
    Columbia                             Minority Member
Wm. Lacy Clay, Missouri              Jim Jordan, Ohio
Stephen F. Lynch, Massachusetts      Paul A. Gosar, Arizona
Jim Cooper, Tennessee                Virginia Foxx, North Carolina
Gerald E. Connolly, Virginia         Thomas Massie, Kentucky
Raja Krishnamoorthi, Illinois        Jody B. Hice, Georgia
Jamie Raskin, Maryland               Glenn Grothman, Wisconsin
Harley Rouda, California             Gary Palmer, Alabama
Ro Khanna, California                Michael Cloud, Texas
Kweisi Mfume, Maryland               Bob Gibbs, Ohio
Debbie Wasserman Schultz, Florida    Clay Higgins, Louisiana
John P. Sarbanes, Maryland           Ralph Norman, South Carolina
Peter Welch, Vermont                 Chip Roy, Texas
Jackie Speier, California            Carol D. Miller, West Virginia
Robin L. Kelly, Illinois             Mark E. Green, Tennessee
Mark DeSaulnier, California          Kelly Armstrong, North Dakota
Brenda L. Lawrence, Michigan         W. Gregory Steube, Florida
Stacey E. Plaskett, Virgin Islands   Fred Keller, Pennsylvania
Jimmy Gomez, California
Alexandria Ocasio-Cortez, New York
Ayanna Pressley, Massachusetts
Rashida Tlaib, Michigan
Katie Porter, California

                     David Rapallo, Staff Director
              Wendy Ginsberg, Subcommittee Staff Director
                          Amy Stratton, Clerk

                      Contact Number: 202-225-5051

               Christopher Hixon, Minority Staff Director

                 Subcommittee on Government Operations

                 Gerald E. Connolly, Virginia, Chairman
Eleanor Holmes Norton, District of   Jody B. Hice, Georgia Ranking 
    Columbia                             Minority Member
John P. Sarbanes, Maryland           Thomas Massie, Kentucky
Jackie Speier, California            Glenn Grothman, Wisconsin
Brenda L. Lawrence, Michigan         Gary Palmer, Alabama
Stacey E. Plaskett, Virgin Islands   Ralph Norman, South Carolina
Ro Khanna, California                W. Gregory Steube, Florida
Stephen F. Lynch, Massachsetts
Jamie Raskin, Maryland

                         C  O  N  T  E  N  T  S

Hearing held on September 14, 2020...............................     1


Written opening statements and statements for the witnesses are 
  available on the U.S. House of Representatives Document 
  Repository at: docs.house.gov.
Ann M. Ravel, Former FEC Chair and CA Fair Political Practices 
  Chair, Adjunct Professor at UC Berkeley Law
Oral Statement...................................................    10

S. David Fineman, Former Chairman, United States Postal Service 
  Board of Governors
Oral Statement...................................................    11

Lisa Graves, Executive Director and Editor-in-Chief, True North 
Oral Statement...................................................    12

Michael Plunkett, President and CEO, Association for Postal 
  Commerce (Postcom)
Oral Statement...................................................    15

Richard W. Painter, S. Walter Richey Professor of Corporate Law, 
  University of Minnesota Law School, Former Chief White House 
  Ethics Lawyer and Associate Counsel to the President 2005-2007
Oral Statement...................................................    16

                           Index of Documents


Documents entered into the record during this hearing and 
  Questions for the Record (QFR's) are listed below/available at: 

  * USPS Mission Statement; submitted by Rep. Keller.

  * Service Performance Measurement of the Postmaster General by 
  the Postal Service; submitted by Chairman Connolly.

  * Washington Post, ``Meet Richard Painter, the Anti Trump 
  Former Republican Who Is Running for Senate As a Democrat'', 
  article; submitted by Rep. Hice.

  * Washington Post article about Minnesota Primary Election 
  Results; submitted by Rep. Hice.

  * CNN, ``Financial disclosures reveal Postmaster General's 
  business entanglements and likely conflicts of interest'', 
  article; submitted by Chairman Connolly.

  * NBC, ``Postal contracts awarded to DeJoy run company were 
  questioned in 2001 Postal Service audit'', article; submitted 
  by Chairman Connolly.

  * The Guardian, ``Trump's postal chief ousted brother to win 
  control of family firm, court files allege''article; submitted 
  by Chairman Connolly.

  * Washington Post article about Postmaster General Dejoy; 
  submitted by Chairman Connolly.

  * ``Tips for Treasurers'' from the FEC; submitted by Rep. 

  * FEC Complaint filed by CREW against Mr. Dejoy; submitted by 
  Rep. Speier.
  * Letter from the Project for Government Oversight; submitted 
  by Rep. Speier.

  * Postal Customer Postcard; submitted by Rep. Speier.

  * Minneapolis Star Tribune article, ``DFL in Bitter Clash with 
  Senate Candidate Richard Painter''; submitted by Chairman 

  * Statement of Support from Citizens of Responsibility; 
  submitted by Chairman Connolly.

  * Statement of Support from Ethics in Washington; submitted by 
  Chairman Connolly.

  * Statement of Support from Candlelight Marketing Economics; 
  submitted by Chairman Connolly.

  * Statement of Support from Released Reports by Lisa Graves; 
  submitted by Chairman Connolly.

  * Questions for the Record:to Mr. Richard Painter; submitted by 
  Chairman Connolly.

  * Questions for the Record: to Ms. Lisa Graves; submitted by 
  Chairman Connolly.

  * Questions for the Record: to Ms. Ravel; submitted by Chairman 

  * Questions for the Record: to Mr. Plunkett; submitted by 
  Chairman Connolly.

                             POSTAL UPDATE


                       Monday, September 14, 2020

                   House of Representatives
      Subcommittee on Government Operations
                          Committee on Oversight and Reform
                                                   Washington, D.C.

    The subcommittee met, pursuant to notice, at 12:08 p.m., in 
room 2154, Rayburn House Office Building, Hon. Gerald E. 
Connolly (chairman of the subcommittee) presiding.
    Present: Representatives Connolly, Maloney, Norton, 
Sarbanes, Speier, Lawrence, Plaskett, Khanna, Raskin, Hice, 
Massie, Grothman, Palmer, and Keller.
    Also present: Representatives Wasserman Schultz, Scanlon, 
and Cooper.
    Mr. Connolly. The committee will come to order.
    Without objection, the chair is authorized to declare a 
recess of the committee at any time.
    The chair would also ask, without objection, that Ms. 
Debbie Wasserman Schultz, Ms. Scanlon, and who else? Mr. 
Cooper? I'm sorry. I've got it right here. Yes. Mr. Cooper, Ms. 
Debbie Wasserman Schultz, and Representative Mary Gay Scanlon 
be waived on to the committee for their participation in 
today's hearing. Without objection, it is so ordered.
    I want to welcome everyone to our hearing on recent 
developments regarding the Postal Service. I now recognize 
myself for an opening statement, and then I will recognize the 
ranking member, Mr. Hice, for his opening statement.
    Mr. Hice, I have agreed--is the chairwoman on? Does the 
chairwoman wish to have an opening statement, because I'll 
recognize her with your permission, Mr. Hice, after myself?
    Our colleague, Mrs. Lawrence, given her long involvement in 
this issue, is also going to issue--have an opening statement, 
I will recognize. And if somebody on your side wants to have 
additional--OK, that would be fine. You just let me know. OK.
    The Postal Service is the crown jewel of our Federal 
Government. It serves every household and business every day. 
It employs 630,000 brave individuals who live in every single 
congressional district. According to Pew Research, 91 percent 
of Americans have a favorable view of the Postal Service--leaps 
and bounds above that of any other Federal entity.
    During the coronavirus pandemic, the Postal Service's value 
to this Nation is greater than ever. The Postal Service is a 
formal component of our Nation's National Response Framework, 
serving as a linchpin of our Nation's response to the pandemic.
    A June 2020 Harris Poll found that the Postal Service 
ranked as the ``single-most essential company to Americans 
during the pandemic,'' because it's a constant in our lives. It 
outranks companies that manufacture PPE and sanitizers in that 
    Starting now and going through November, the Postal Service 
will also play a critical, unprecedented, in the sense of 
expanded, role in our democracy, protecting the health of 
voters who cast their ballots by mail. We know postal workers 
can handle the volume of that election mail. The question is 
whether those at the helm are taking steps to hinder that 
capacity and slow it down in ways that hurt the prospects of a 
fair election but benefit one candidate's reelection campaign.
    It's essential that Postal Service leadership demonstrate 
nonpartisanship and not cronyism or favoritism.
    Leading the Postal Service, serving everyone in our 
country, and particularly during this pandemic, is a 
responsibility to bestow upon only the most qualified and 
honorable of leaders. It's a job for those who are ready and 
willing to listen to the millions of stakeholders--mail 
recipients, mailers, voters, unions, veterans, older Americans, 
Congress, and so many others--to connect the United States, as 
Benjamin Franklin foresaw, and serve as the thread that unites 
our society's many fabrics.
    Unfortunately, that's not what is happening. Instead, we 
have a Board of Governors who inserted a political ally of the 
President into the search process at the 11th hour, 
circumventing proper vetting and background checks.
    We have a crony at the helm of our Nation's Postal Service, 
a man rife with conflicts of interest and potential violations 
of law even. We have a Postmaster General who would benefit 
financially if the Postal Service contracts out its services 
and sprints toward privatization. He who would benefit 
financially and politically if mail-in ballots are delayed or 
    That would be unacceptable under any circumstance. It's 
catastrophic, however, during a global pandemic, on the 
precipice of one of the most consequential national elections 
in our lifetimes.
    This hearing seeks to provide the public with an update on 
what we know about the background and qualifications of the 
Postmaster General selected by the Board of Governors. In fact, 
one might say that this is the homework that Board of Governors 
should have done but failed to do.
    Using publicly available resources, we'll piece together 
the troubling past of Mr. DeJoy. We'll examine his actions 
related to campaign donations while he was at the helm of New 
Breed Logistics. We'll explore his continued investments in 
companies that benefit from contracts with the Postal Service, 
companies that would also benefit if the USPS pursued the 
President's plan for privatization. We will discuss why these 
actions and those connections matter and why they should have 
rendered him, in my view, ineligible for consideration for this 
    Mr. DeJoy's first day of work was June 15. Today marks the 
start of his 13th week of Federal service. Yet, his record is 
characterized by tumult, controversy, plummeting service, 
betrayal of customers in dire need of lifesaving medicines and 
supplies. But the trucks are on time, albeit with the mail 
often left behind. So, there is that.
    We learned at our last hearing that Mr. DeJoy has known for 
weeks that his so-called ``operational changes,'' that just so 
happened to coincide with the election starting, slowed down 
the mail by 10 percent. That's according to their own inside 
sources, as the chairwoman of this committee made public at our 
last hearing.
    For two weeks, he withheld from Congress and the public the 
data and analysis that demonstrated how his leadership 
undermined the actual mission of the Postal Service--to deliver 
the mail.
    Days later, details of Mr. DeJoy's personal lack of ethics 
have come to light. He reportedly forged his own brother's 
signature to take greater control of his family's company. Mr. 
DeJoy, reportedly, and potentially illegally, used the family 
company as a personal political action committee, coercing his 
staff, reportedly, to donate to preferred Republican 
candidates, and then reimbursing those employees with bonuses 
and salary.
    If true, DeJoy's actions should have been of great concern 
to the Board of Governors and could be prosecuted for criminal 
    But we're not done. Over the weekend, the Postmaster 
General sent every home in America a mailer instructing all who 
seek to vote by mail to request a mail-in ballot, sending 
misinformation and confusing voters in nine states that 
automatically send out such ballots. This debacle could have 
been avoided if Mr. DeJoy had simply accepted the offers of 
state election officials to proofread that message before he 
sent it out.
    Today, we see reports emerging that when Mr. DeJoy was the 
CEO of New Breed Logistics and contracting with the Postal 
Service, his company may have received as much as $53 million 
in overpayments for services rendered.
    The dossier released today by Ms. Lisa Graves, one of our 
witnesses, shows that Mr. DeJoy continues to hold investments, 
assets, or other interest in entities that benefit when the 
Postal Service contracts out its operations. Moreover, Mr. 
DeJoy improperly mixes his personal and political friendships 
with his nonpartisan position, ostensibly, as PMG.
    What should scare every American who believes that the 
Postal Service should not be an arm of any campaign is that Mr. 
DeJoy, in his official capacity, continues to conceal his 
secret coordination with Trump campaign associates, about which 
he has also provided misleading information and testimony 
before the Congress.
    The chairwoman and I have repeatedly asked the Postmaster 
General and the Board of Governors for information that would 
justify the sweeping operational changes, clarify what Mr. 
DeJoy's investments are, ensure transparency of operations, and 
restore trust in the Postal Service. They have not given the 
committee the documents we have requested and that we require.
    On September 2, Chairwoman Maloney issued a subpoena 
compelling Mr. DeJoy to produce a wide range of documents, 
including those previously requested and a list of contacts, 
all contacts, with Trump campaign affiliates and individuals.
    Today is the deadline for the Board of Governors to provide 
the committee documents and information to shed light on the 
way Mr. DeJoy was selected for this position.
    While the Board of Governors might be, quote, ``tickled 
pink,'' unquote, with Mr. DeJoy's performance, the American 
people are not. Perhaps they need to be reminded that their job 
is to serve the country, not any particular President.
    I look forward to hearing from our expert witnesses today 
and continuing this critical discussion and the committee's 
ongoing investigation.
    With that, I recognize my friend, the distinguished ranking 
member, for his opening remarks.
    Mr. Hice. Thank you, Mr. Chairman.
    I think just the mere notion that this hearing is a postal 
update is utter nonsense. By the chairman's own admission, just 
moments ago, the issues that will be discussed in the hearing 
today shows this hearing for what it is, an absolute farce. In 
fact, not a single one of the witnesses who are here--we're 
supposed to be having a postal update. Not a single one of the 
witnesses even work for the USPS currently.
    The fact is, in relation to the Postal Service update, 
because of better than expected revenue during this pandemic, 
because of packages, the Postal Service has reported that it 
has enough money to be totally solvent through at least August 
of next year, 11 months from now. Eleven months. There is no 
immediate need for a $25 billion bailout.
    However, as GAO reported in May, and as we have all known 
now for decades, the USPS' current business model is not 
financially sustainable because of such things as declining 
mail volumes, increased compensation costs, and rising unfunded 
    The $25 billion bailout money cannot fix these types of 
problems. All it does is just push the problems down the road a 
little bit further for us to have to deal with it later.
    We have 11 months, as of right now, 11 months to come 
together to work in a bipartisan fashion to bring real reforms 
to the Postal Service, just like, Mr. Chairman, you did with my 
predecessor, Mark Meadows. But instead of having a serious 
discussion about proposals for a postal reform bill, we are 
using this valuable time to delve into conspiracy theories 
about the Koch family and to opine into Mr. DeJoy's financial 
    Assembling a group of people like we are doing here today, 
regardless of their experience, to speculate with no more facts 
or information than what is printed in The Washington Post, is 
absolutely a waste of time. This is, in my opinion, as close to 
a kangaroo court as anything I've seen.
    And given the reckless apathy toward facts and truth as the 
Democrats have exhibited throughout this entire affair, it's 
clear that this so-called hearing is nothing more than a 
further attempt at political assassination.
    What we do know at this point is that the USPS Ethics 
Office cleared Mr. DeJoy to retain certain assets. And to the 
best of anyone's knowledge here, he has complied with the 
conditions around that ruling.
    For his part, the Postmaster General has confirmed at our 
full committee hearing that the OIG is currently conducting an 
investigation, and he said that he welcomed the results of that 
    Furthermore, the President himself has said that he is open 
to a campaign finance investigation of the Postmaster General, 
and said if he did something wrong, if it could be proven, if 
there is evidence of wrongdoing, then he should lose his job.
    Despite all of the cooperation between those two, the 
Democrats try to paint them as partners. It sounds like at 
least the two of them, the Postmaster and the current 
administration, are willing to at least collect the facts and 
evidence before rushing to judgment, something certainly that 
this committee so far has not done.
    Just for example, when the entire House was forced to vote 
on a postal bailout bill before we even had a hearing, before 
we even had the opportunity to question the Postmaster General 
and analyze data on what was causing the reported slowdowns, or 
when the Democrats claimed that the removal of collection boxes 
and sending letters to states about their election deadlines 
was somehow an assault on the Postal Service and democracy 
without even admitting the fact that these are the same actions 
that Postmaster Generals in the past have done, the same 
actions that they have taken time and again.
    Today we're having a hearing two days before the Postal 
Service is due to start producing documents from the Democrat 
subpoena which asked for documents regarding the Postmaster 
General's divestments, recusals, and communications with the 
Ethics Office.
    But let me just add this. In the documents that have 
already been received from the Postal Service, there is 
evidence of the Democrats' disingenuous narrative about the 
USPS. The documents show in black and white evidence countering 
two of the Democrats' favorite topics on this issue: the postal 
boxes and mail-sorting machines. Interestingly, more of these 
were removed just prior to the 2016 election than have been 
removed this year. Yet, strangely, I don't recall any talk 
about it then.
    So, as a result, the hearing today will not be based on 
fact, it will be based on conjecture and supposition.
    In the hopes of one day that we will resume genuine postal 
reform, I have invited Mr. Mike Plunkett of the Association for 
Postal Commerce, or PostCom. This is a national association of 
businesses and organizations that rely on the use of mail for 
communications and commerce.
    I certainly look forward to hearing from him, as well as 
our other witnesses who are here with us today. Hopefully, we 
will be able to move forward with genuine efforts for postal 
reform rather than these types of hearings that are nothing 
more than a kangaroo court to score political points.
    With that, Mr. Chairman, I yield back.
    Mr. Connolly. I thank the gentleman. I would simply note 
for the record what was characterized as character 
assassination was actually an in-depth investigation done by 
The Washington Post, and independent media outlets confirmed 
the findings of The Washington Post investigation that members 
of New Breed staff, when Mr. DeJoy was the CEO, were pressured 
to make straw donations, to make donations which could be 
construed as straw donations.
    Mr. Hice. I appreciate the chairman's remarks with that. 
But the fact is this hearing is supposed to be about postal 
updates, not about potential investigations or the kangaroo 
court type investigation that we're having here today.
    Mr. Connolly. We appreciate the gentleman's point, but 
leadership of the Postal Service is directly related to issues 
about performance of the Postal Service. That's what leadership 
is about.
    Before I call on Mrs. Lawrence and then Mr. Keller for 
opening statements, I recognize the chairwoman of the full 
committee for any comments she may wish to make.
    Mrs. Maloney. Good morning. I would like to thank you, 
Chairman Connolly, for holding this important hearing and being 
such a strong partner in our investigation to hold the Postal 
Service and its leadership accountable to the American people.
    I would like to welcome our witnesses. We look forward to 
learning from you and working with you to ensure that the 
public interest is protected, and I thank you for being here.
    Ever since the Board of Governors announced the selection 
of Mr. DeJoy as Postmaster General, questions have been raised 
about the process for selecting him and possible conflicts of 
interest given his many financial interests in Postal Service 
    During our full committee hearing on August 24, 2020, 
multiple committee members questioned Mr. DeJoy and Board 
Chairman Duncan about his selection process and whether it was 
influenced by the fact that both Mr. DeJoy and Mr. Duncan are 
longtime megadonors for the Republican Party.
    When directly asked by Congressman Cooper whether Mr. DeJoy 
had ever paid back any of his executives for contributing to 
Republican campaigns by providing bonuses or rewarding them, 
Mr. DeJoy responded in no uncertain terms and, strongly, and I 
quote, ``That's an outrageous claim, sir, and I resent it,'' 
end quote.
    Yet, less than two weeks later, a headline appeared in The 
Washington Post which stated, and I quote, ``Louis DeJoy's rise 
as GOP fundraiser was powered by contributions from company 
workers who were later reimbursed, former employees say,'' end 
    If true, these allegations are not only incredibly 
unethical, they are illegal. And to compound these possible 
crimes, Mr. DeJoy would have lied to Congress as well.
    The United States Postal Service is one of our Nation's 
most trusted institutions. It dates back to the very founding 
of our country, it is mentioned in our Constitution, and 
consistently receives the highest rating of Federal agencies 
from the public. Every day it provides millions of people with 
access to critical mail, medications, and especially in this 
unique election, mail-in ballots. But how long can we expect 
the faith of the American people to last if the Postal Service 
is tainted by partisan leadership and alleged criminal 
    These are just a few of the reasons why I have introduced 
the Nonpartisan Postmaster General Act, which will prevent 
Postal Service leadership from participating in any political 
activity and will prevent anyone who has held a political 
position in the last four years from being hired as Postmaster 
General or Deputy Postmaster General. This is critical, time-
sensitive legislation that the full committee will consider 
this week.
    Again, I thank Chairman Connolly for holding this important 
hearing and the witnesses for being here today, and I look 
forward to hearing from all of my colleagues on both sides the 
aisle on this vital issue.
    I yield back the balance of my time.
    Mr. Connolly. I thank the chairwoman, and I also thank her 
for her leadership. You know, after she was elected chairwoman, 
she and I had a conversation minutes after the election, on the 
floor of the House, and the very first thing the chairwoman 
brought to my attention was postal reform, the need for 
comprehensive postal reform.
    So, obviously, that's been a priority, you have said, since 
you became chairwoman of this committee, and I really 
appreciate it. Thank you, Mrs. Maloney.
    Mrs. Maloney. Thank you. I look forward to working with you 
on it, and my colleague Mr. Comer and others. Thank you.
    Mr. Connolly. I am now going to call on Congresswoman 
Brenda Lawrence for an opening statement. Then, Mr. Keller, you 
will also be called on for an opening statement. Then we will 
hear from our witnesses.
    Mrs. Lawrence, welcome.
    Mrs. Lawrence. Thank you.
    I want to thank Chairman Connolly for holding this 
important hearing.
    Prior to serving in Congress, I want the record to reflect 
that I spent 30 years, almost 30 years with the United States 
Postal Service. During that time, I worked alongside some of 
the Nation's most dedicated public servants, individuals who 
work long hours to ensure that the American people across this 
country receive their mail in a timely manner.
    The Postal Service's existence is a critical government 
service that began in 1775. Throughout history, whether it was 
world wars or global pandemics, the Postal Service rose to the 
challenge and continued to deliver mail across this country and 
throughout the world.
    During the Civil War, the Postal Service did not cease 
their operations. During the 1918 flu outbreak, which was the 
same as the pandemic, COVID-19, that we're going through, the 
Postal Service never stopped continuing to move the mail, even 
while people were dying within the Service.
    To this day, the Postal Service's ability to deliver mail 
to our Nation's heroic servicemembers serving at home, and even 
abroad in a war zone, provides a vital link to their families 
and to their friends back home.
    Never before have I seen a Postmaster General undermine the 
Postal Service's ability to do its work; by undertaking the 
kind of drastic and ill-informed operational changes that our 
current Postmaster General, Mr. DeJoy, has instituted in recent 
    In a hearing before this very committee last month, the 
Postmaster General confessed that he didn't know the Postal 
Service's stated mission and that he couldn't explain some of 
his most harmful operational changes.
    I feel like I'm stating the obvious, but a businessman with 
absolutely no experience serving in the Postal Service should 
not have changed operational procedures without first grasping 
the negative impacts that they would have on our delivery.
    I want everyone to know that he ordered the removal of more 
than 700 sorting machines, just this year alone, nearly double 
the average number of mail-sorting machines that are removed on 
an annual basis.
    While I try to find the best in people, Mr. DeJoy's recent 
reversal can better be understood as an admission that his 
policies ended up being more disastrous to the Postal Service 
than he even understood.
    Regardless, mail sorting machines are still being removed, 
leading us to question whether Mr. DeJoy is serious about 
correcting his mistakes.
    In the more than four months--think about this--700 
machines. And more, he has only been there four months. He has 
caused incredible harm to the reputation and, most importantly, 
the trust that the American people have in the Postal Service.
    We cannot take this situation lightly in the midst of a 
global pandemic when millions of Americans may plan to vote by 
mail. The disastrous policies by this Postmaster General 
jeopardizes the American people's well-being and pose an 
immediate threat to our democracy.
    I look forward to hearing from our witnesses today. Again, 
I want to thank the chairman. And I yield back.
    Mr. Connolly. Thank you, Mrs. Lawrence. Thank you for your 
    Mr. Keller, you are recognized for a five-minute opening 
    Mr. Keller. Thank you, Mr. Chairman.
    First, I would like to echo the sentiments of the ranking 
member and say that reports about the Postmaster General are 
speculation. This hearing is another attempt to attack the 
Postmaster General instead of tackling the real issue of postal 
    My colleagues on the other side of the aisle have been 
critical of Postmaster DeJoy's focus on operational 
efficiencies and have launched into conspiracy theories that 
these are somehow tied to destroying the Postal Service.
    So, the key question is: Why does USPS need be to 
efficient? The answer is simple: It's so Americans can have a 
reliable and affordable Postal Service.
    As one of our witnesses has mentioned in his testimony, the 
Postal Reorganization Act of 1970 established the USPS to be a 
self-sustaining, business-like entity that would cover its 
costs primarily with revenues from postage. When the Postal 
Service is spending money on inefficient routes or extra 
machines, those costs get passed on to Americans and businesses 
in the form of slower service or possibly increased postage.
    Meaningful postal reform will require changes from the 
status quo and the current broken business model that results 
in regular threats of insolvency.
    The Government Accountability Office recently published a 
report, and the title says it all: ``U.S. Postal Service: 
congressional Action is Essential to Enable a Sustainable 
Business Model.''
    USPS' financial viability has been on GAO's High-Risk List 
since 2009 due to their poor conditions, worsened by the long-
term decline in mail since the rise of the internet.
    GAO found that First Class mail declined 44 percent since 
Fiscal Year 2006, and that the Retiree Health Benefit Fund is 
projected to be depleted by 2030 if the Postal Service 
continues to not make payments.
    These are the issues we need to focus on and develop 
bipartisan solutions. We also need to hear from stakeholders 
who rely on the mail, like Mr. Plunkett, who the Republicans 
invited. We need to hear from them about reforms that should be 
put in place.
    Furthermore, the Postal Service needs to communicate a 
long-term business plan to Congress, an item I have been 
requesting since the previous Postmaster General's tenure. None 
of that is achieved by today's hearing.
    Last, I want to address the false notion about privatizing 
the Postal Service. Mr. Chairman, I would like to submit to the 
record the USPS Mission Statement from the agency's website 
adopted by the Board of Governors on April 1, 2020.
    Mr. Connolly. Without objection.
    Mr. Keller. Thank you. This statement was adopted by the 
very Board of Governors that some witnesses today claim are 
hyperpartisan actors. It was also created before Postmaster 
DeJoy arrived and remains unchanged. It states that part of its 
mission is to serve the American people and through the 
universal service obligation bind our Nation together by 
maintaining and operating our unique, vital, and resilient 
    To carry out this mission, the Board of Governors states 
that the Postal Service will remain an integral part of the 
U.S. Government, providing all Americans with universal and 
open access to our unrivaled delivery and storefront network.
    The Postal Service is a crucial part of our Nation's 
communications and commerce. Fearmongering and sham hearings, 
like this one today, only weaken the public's trust in such an 
important institution.
    Thank you, and I yield back.
    Mr. Connolly. Thank you, Mr. Keller.
    I would also ask that we enter into the record the findings 
of the Trump task force that President Trump put together just 
a few years ago that, in fact, did recommend privatization of 
the Postal Service, contradicting the statement of the Board of 
Governors. So, there's a contradiction that I think ought to be 
in the public record.
    With that, our first witness is Ann Ravel, who is a former 
Federal Election Commission Chair and California Fair Political 
Practices Chair, currently serving as adjunct professor at UC 
Berkeley Law.
    Then we'll hear from David Fineman, who is the former 
Chairman of the Postal Service Board of Governors and currently 
serves as a senior partner at Fineman Krekstein & Harris as 
Chairman and Secretary of the Fair Elections Center.
    Then we will hear from Lisa Graves, who's the Executive 
Director and Editor-in-Chief of True North Research.
    After that, we'll hear from Michael Plunkett, who is the 
President and CEO of the Association for Postal Commerce.
    Finally, we'll hear from Richard Painter, who is here with 
us in real time, a familiar figure here on this committee, who 
was a former chief White House ethics lawyer under the Bush 
Administration and current law professor at the University of 
    If we could ask all of our witnesses to be unmuted, and if 
you would raise your right hand. And if you would rise, Mr. 
Painter, and raise your right hand.
    Do you swear or affirm that the testimony you are about to 
give is the truth, the whole truth, and nothing but the truth, 
so help you God?
    Let the record show that all of our witnesses answered in 
the affirmative. Thank you.
    Without objection, your written statements will be made 
part of the record. We ask you to summarize in your five-minute 
opening statement what you want the committee to know.
    Ms. Ravel, welcome.


    Ms. Ravel. Thank you, Chairman Connolly and Ranking Member, 
for the opportunity to testify today.
    In his farewell address, President Obama said something 
that is pertinent to this hearing. ``Our democracy is 
threatened whenever we take it for granted. All of us, 
regardless of party, should throw ourselves into the task of 
rebuilding our democratic institutions. When voting rates are 
some of the lowest among advanced democracies, we should make 
it easier, not harder to vote. When trust in our institutions 
is low, we should reduce the corrosive influence of money in 
our politics and insist on the principles of transparency and 
ethics in public service.''
    We have, unfortunately, allowed our institutions that are 
meant to protect our democracy to atrophy, and we're seeing the 
results. I observed it as the Chair and Commissioner of the 
Federal Election Commission, and we can certainly see it in the 
actions of Mr. DeJoy.
    Which is why it's so important to have this hearing on Mr. 
DeJoy's violations of campaign finance laws, his ethical 
transgressions, and his potential to suppress the vote of 
Americans through the Postal Service, which, has been noted, is 
crucial for all citizens to be able to cast their ballots.
    The almost $1 million that was contributed by Mr. DeJoy's 
employees to political candidates, at his urging, which was 
paid back in the form of bonuses, is an illegal straw donor 
scheme. Contributions through conduits and funds that are 
diverted from the corporate treasury and laundered to 
contribute directly to a candidate are prohibited. Even 
Citizens United held that it's corrupting for a corporation to 
contribute directly to candidates, and funneling the money 
through employees is clearly illegal.
    Discussing similar facts in 2017, the United States 
Department of Justice concluded in their Federal Prosecution of 
Election Offenses manual that a contribution in the name of 
another is often used to disguise other campaign finance 
violations by those who are at their distribution limit, and 
that a common conduit scheme involves a corporate official who 
instructs corporation employees to make contributions to a 
candidate, and then reimburses them from corporate funds, 
generally, they said, through fictitious bonuses or pay raises. 
So, Mr. DeJoy's actions are the poster child for these 
    Additionally, Mr. DeJoy coerced his employees to 
contribute. Employees thought their jobs were on the line or 
they wouldn't be promoted if they didn't contribute. The DOJ 
manual, again, states that in all employment situations, the 
potential for coercion, expressed or implied, is inherent in 
the supervisor-subordinate relationship.
    So, contributions solicited from a subordinate aren't 
voluntary. It's illegal to coerce any individual to make a 
contribution or engage in fundraising for a candidate. Such 
coercion is also a threat to democratic processes, because 
workers' freedom of expression and exercise of their own 
political views is threatened.
    But in nearly every case of major significance over a 
decade, the FEC has not even investigated serious allegations, 
such as this, and rarely enforced the law. It's well known that 
the laws can be ignored.
    These ethics laws meant to stop corruption and provide 
valuable information to voters are essential to the integrity 
and fairness of the political process and to ensure trust in 
government. The failure of these protections led to where we 
are today with Mr. DeJoy, who was skirting campaign finance 
laws, knowing that with no consequences for violations he could 
instead be rewarded for his illegal and unethical acts.
    Now, we have to be vigilant that our right to vote won't be 
impacted by a politicized Postal Service. Across the political 
spectrum, faith in the democratic process disintegrates as 
Americans might question both the validity of the election and 
the government's response to the voting challenges that we're 
    Just one important comment here. To return faith in our 
democracy and put our protections back, we need to have H.R. 1, 
the For the People Act, enacted. Thank you so much.
    Mr. Connolly. Thank you, Chairwoman Ravel. Right on the 
nose. Appreciate it.
    Chairman David Fineman.


    Mr. Fineman. Thank you, Mr. Chairman, for inviting me to 
participate in this hearing. I am the Chairman of Fair 
Elections Center, a 501(c)(3) nonpartisan group that works 
diligently to ensure that every American has a right to vote.
    I served during both the Clinton and Bush Administrations 
on the Board of Governors of the United States Postal Service 
and was Chairman from 2003 to 2005, during the Bush 
Administration, as its Chairman. I would also indicate to you 
that never did I hear from the President of the United States 
or any member in the executive branch regarding postal affairs.
    I was offended when the President referred to the Postal 
Service as a joke. I was even more offended when I realized 
that there were 600,000 employees who were not a joke, who were 
risking their lives to deliver the mail every day.
    Folks like Al Rosen, who after World War II joined the 
United States Postal Service in Philadelphia, stayed there for 
over 30 years, and led a wildcat strike in 1970. You see, Al's 
son, Joe, is a fraternity brother of mine. Joe, after 
graduating college and then going to law school, joined the 
FBI, and he had a distinguished career in the FBI and then 
became an immigration lawyer in Philadelphia.
    There are hundreds and thousands of stories like this of 
middle-class families being affected by their jobs at the 
Postal Service, and Al Rosen was not a joke.
    In 1968, it became evident to the American public that the 
post office was failing in its mission to deliver mail on a 
timely basis. As a result, the Kappel Commission issued a 
report in June 1968. It begins by describing how mail is piling 
up and not being delivered in Chicago, and it concludes that 
the reason for this is because of the intrusion of politics 
into the United States Postal Service.
    As a result of the commission's report and wildcat strikes 
in most eastern cities, Congress passed the 1970 Reorganization 
Act to take politics out of the Postal Service. It created the 
U.S. Postal Service as an independent establishment in the 
executive branch with a Board of Governors, five of one party, 
four of another, who would then select the Postmaster General. 
This process was to lead to an apolitical Postmaster General.
    In 2006, the law was amended again to eliminate an 
antiquated postal rate system and to allow the Postal Service 
more flexibility. However, it established the law that if the 
Postal Service was going to change the manner in which it 
delivered mail on a national basis, it had to go to the Postal 
Regulatory Commission for a hearing.
    This Postmaster General and the Board of Governors decided 
not to do that. It resulted in 25 lawsuits filed throughout the 
United States by attorneys general.
    The law also requires that the Postal Service pre-fund--and 
we have heard about this--its pension obligation for 75 years. 
This Congress passed House bill 2382 with 309 votes in a 
bipartisan manner. The bill presently sits on Majority Leader 
McConnell's desk awaiting action by the Senate.
    In my law practice, I sometimes act as a mediator. So, 
having heard the comments of the Republicans and the Democrats, 
and there has not been one written statement against this 
legislation, I'm asking that the Democrats and the Republicans 
on this committee ask Senator McConnell to bring this bill to a 
vote before the Senate. I also ask Postmaster General DeJoy, 
Chairman Duncan, who seem to be good friends with Senator 
McConnell, to ask him to bring that bill to a vote before the 
U.S. Senate.
    Thank you, Mr. Chairman.
    Mr. Connolly. Thank you, Mr. Fineman. You're also right on 
the money.
    Ms. Graves.

                   CHIEF, TRUE NORTH RESEARCH

    Ms. Graves. Good morning, Chairman Connolly, Ranking Member 
Hice, and distinguished members of the subcommittee.
    My name is Lisa Graves, and I am the Executive Director of 
the watchdog group True North Research. I help lead 
collaborations like KochDocs, BOLD ReThink, and the Ben 
Franklin Project. I previously served as Deputy Assistant 
General and Chief Counsel for Nominations for the U.S. Senate 
Judiciary Committee, where I vetted judicial nominees.
    Thorough vetting is essential to protecting the integrity 
of our democratic institutions. It helps to ensure appointees 
to positions of public trust are highly qualified and do not 
have conflicts or agendas that would put their personal 
interests ahead of the public interest.
    Unfortunately, based on new information about Mr. DeJoy's 
background and actions, it's clear that a new, inexperienced, 
partisan-led, and shorthanded Board of Governors appointed by 
Donald Trump failed to properly vet him to protect the 
interests of the American people, and it continues to fail to 
do so.
    I am calling on Mr. DeJoy to be fired or to resign.
    First, as Ms. Ravel testified, Mr. DeJoy is facing new, 
credible allegations of violating anticorruption laws for using 
straw donors. Congressman Cooper asked Mr. DeJoy if he had ever 
reimbursed employees for political donations, and he denied it.
    Based on this newly reported information, however, I 
respectfully ask the committee to make a formal referral to the 
U.S. Attorney's Office to investigate whether Louis DeJoy's 
testimony violated 18 U.S.C. 1001 of the Criminal Code.
    Second, Mr. DeJoy has been accused of violating the law 
before by his own brother. Dominick DeJoy, Jr., swore in a 
complaint that he was cheated out of the family business by Mr. 
DeJoy, who secretly created LLCs, private LLCs that were 
portrayed to him as jointly owned subsidiaries. Mr. DeJoy 
admitted that they were separate though similarly named firms, 
but denied that he did anything wrong.
    His brother also alleged in the suit--which he denied, and 
was settled through a secrecy agreement--that Louis DeJoy 
forged his signature and hid monthly mailed bank statements 
from two banks and an investment firm for accounts that were 
secretly opened in Dominick's name.
    No Postmaster General in history has ever been subject to 
such charges before in a civil court or criminal court. If Mr. 
DeJoy cannot be trusted by his own flesh and blood with not 
hiding his mail and millions of dollars, how can Americans 
trust him with millions of our votes? How could the new Postal 
Board of Governors approve a person with this troubling history 
to be Postmaster General? Well, the third point is the answer 
appears to be that Louis DeJoy's enormous political 
contributions made the difference.
    President Trump appointed Mike Duncan to the Board of 
Governors, and he has helped raise tens of millions of dollars 
to help keep Senator Mitch McConnell in power and aid GOP 
elections through donor data bases and more. Mr. Duncan 
admitted to this committee that DeJoy was not originally on the 
list of prospective candidates for the job. However, following 
$600,000 in contributions to the RNC and President Trump's 
reelection strategy, Mr. DeJoy suddenly jumped to the top of 
the list.
    It is simply wrong to put such a partisan political insider 
in charge of the Postal Service, especially in an election 
year. Mr. DeJoy's close ties to Trump, who has attacked vote by 
mail, are disqualifying and raise a legitimate question we have 
never had to ask before: Will Mr. DeJoy use his power as the 
Postmaster General to deliver our ballots on time, or to 
deliver the election to the man he has spent hundreds of 
thousands of dollars on and raised millions to help win, Donald 
    Fourth, Mr. DeJoy's financial conflicts are also enormous 
and unprecedented. Mr. DeJoy has tens of millions of dollars in 
stock in XPO Logistics, a contractor and competitor of the 
Postal Service, and he receives millions annually from it 
through leases and stock transactions. No known Postmaster 
General in history has ever had such financial conflicts like 
Mr. DeJoy.
    Fifth, his destructive actions. Mr. DeJoy's actions since 
he took the job in June warrant his dismissal. If he had been a 
probationary employee, he would have been fired at least a 
month ago.
    In the midst of an unprecedented pandemic, in a 
Presidential election year dependent on reliable mail, Mr. 
DeJoy suddenly fired or demoted nearly two dozen Postal Service 
experts. On his watch the Postal Service restricted the 
availability of overtime. And hundreds of mail-sorting machines 
were removed, far more than the usual amount in the past five 
years. He dictated a disruptive change in nationwide processes 
by ordering that trucks depart even if the daily mail sorting 
was not complete. He even micromanaged where mail trucks could 
    These dictates led to chaos and real consequences and 
hardships, such as for senior citizens and veterans whose 
lifesaving prescriptions are being delivered late.
    Our Postal Service needs a person of the highest integrity, 
not a leader of the highest partisanship and arrogance, like 
Mr. DeJoy.
    Sixth, unfortunately, his actions have destabilized the 
Postal Service and may be paving the way to privatizing it. As 
I have documented, billionaire Charles Koch has staked efforts 
to privatize the Postal Service since the early 1970's. His 
postal operation has been running digital ads to pressure U.S. 
Senators not to give the Postal Service the COVID relief funds 
that it has previously requested.
    A long-time Koch ally worked with Senator Collins in 2006 
to weigh the Postal Service down with an unprecedented debt 
burden for future healthcare benefits, an extraordinary 
liability no another agency or company has.
    But Mr. DeJoy is playing partisan politics with the Postal 
Service by refusing to seek the COVID relief funding it needs. 
Instead, it's slash and burn.
    So, in conclusion, I urge Congress to protect the Postal 
Service's mission and the American people and the integrity of 
our elections by calling for Postmaster General Louis DeJoy to 
be fired, by fully investigating his activities, and by 
restoring Congress' constitutional role in approving the 
Postmaster, restructuring the board, and repealing the 2006 
unprecedented debt anchor and other restrictions from that law.
    Mr. Connolly. Thank you.
    Ms. Graves. The Postal Service belongs to us.
    Thank you, Mr. Chairman.
    Mr. Connolly. Thank you, Ms. Graves.
    Mr. Michael Plunkett, you are recognized for five minutes.


    Mr. Plunkett. Good afternoon, Chairman Connolly, Ranking 
Member Hice, and members of the committee. Thank you for the 
opportunity to speak with you today about the current state of 
the Postal Service.
    I am here on behalf of the Association for Postal Commerce, 
PostCom. Our members are world-class organizations in financial 
services, healthcare, telecommunications, logistics, mail 
production technology, and shipping. They include some of the 
most recognizable brands in the world, as well as small 
proprietors offering specialty products and services.
    This diverse group is united in its reliance on the Postal 
Service and is committed to ensuring that reliable, affordable 
postal services remain available to all U.S. businesses and 
    The Postal Service is a beloved public institution and a 
critical component of the Nation's economic infrastructure. 
It's also the center of a mailing industry that employees more 
than 7 million Americans, providing jobs in every state and 
accounting for more than a trillion dollars in annual revenue.
    Like many industries, ours has been hit hard by COVID-19. 
Along with economic turmoil, the pandemic has brought into 
sharp focus the importance of the Postal Service to the 
American public. Postal employees have served the public 
admirably since the pandemic began and have been a reassuring 
presence in our communities during a difficult time.
    At the same time, the pandemic has brought about sudden and 
dramatic shifts in consumer behavior that are exposing the 
underlying fragility of the Nation's postal system.
    PostCom's members rely on the Postal Service to deliver 
bills, statements, magazines, prescription medication, 
packages, catalogs, and essential business communications. Our 
members, to a great extent, fund the provision of universal 
postal service in the United States through the rates that they 
pay for commercial mail and shipping services.
    As Congress considers how best to provide support to the 
Postal Service, we urge a measured and targeted approach with 
safeguards that ensure accountability for how any relief 
funding is utilized. We recognize the Postal Service has 
incurred unforeseen expenses to acquire personal protective 
equipment and emergency transportation services as a result of 
    The understandable desire of legislators to provide relief 
should not lead to excessive and unnecessary diversion of 
resources that may be better deployed elsewhere and that will 
do little to address the challenges facing the Postal Service.
    Despite persistent doom-laden stories about imminent 
collapse, the Postal Service has adequate resources and 
capacity to successfully navigate the 2020 election cycle. 
According to its own reporting, at the end of the third quarter 
the Postal Service had cash holdings approaching $13 billion. 
Since that time, Postal Service revenues have been growing 
thanks to significant growth in its package business. In the 
most recent postal quarter, the Postal Service generated almost 
$2 billion in cash-flow from its operations.
    No one can say whether these shifts from letter mail to 
packages are permanent, whether package growth will continue to 
sustain the Postal Service, or that letter mail will rebound 
when the pandemic recedes and the economy improves. But the 
CARES Act passed earlier this year provides for an additional 
$10 billion in borrowing authority for the Postal Service 
should unforeseen events create the need.
    At a recent hearing, Postmaster General DeJoy confirmed 
that the Postal Service has sufficient liquidity to fund 
operations well into 2021. Not only is an arbitrary infusion of 
funds unnecessary to ensure that election mail is delivered, 
the sums contemplated by Congress would barely make a dent in 
the primary obstacle to a financially sound Postal Service, its 
long-term retirement liabilities. In fact, our members are 
concerned that any major relief funding might lead Congress to 
declare victory and continue to postpone much-needed postal 
    We respectfully urge Congress to return to the task of 
enacting comprehensive postal reform legislation to secure the 
future of the Postal Service. In order for mail to fulfill its 
statutory role as an integral part of the Nation's economy, 
it's important that it be affordable and reliable as a means 
for communicating and transacting business. We believe 
stakeholders can and will support reform legislation, centered 
on several critical elements.
    One, a well-defined universal service obligation based on a 
thorough assessment of what the U.S. needs from its postal 
    Two, safeguards to ensure that capped users of the Postal 
Service's monopoly products maintain pricing predictability.
    Three, a revised approach to funding the Postal Service's 
retiree obligations by utilizing funding investment strategies 
more in line with best practices.
    Finally, oversight to ensure that accountability and 
transparency are maintained, as funds provided by ratepayers or 
appropriated by Congress may be squandered or otherwise 
    The Postal Service is not on the verge of imminent 
collapse. The COVID-19 pandemic, which has tested the agency, 
has also reminded us that it remains a vital part of our 
economy and the civic life of Americans. The Postal Service has 
the employees, resources, and capacity it needs to perform its 
mission during the current election cycle without a massive 
infusion of supplemental funding.
    However, the systemic challenges that plague the Postal 
Service remain. Because the postal relief currently under 
consideration is unnecessary in the short term and inadequate 
in the long run, we respectfully suggest that Congress instead 
focus its efforts on much-needed and long-overdue postal reform 
    Thank you.
    Mr. Connolly. Thank you so much. Right on the money, Mr. 
    Finally, but not least, Mr. Painter.

                     PRESIDENT (2005-2007)

    Mr. Painter. Thank you very much, Mr. Chairman, Ranking 
Member, members of the committee. I'm Richard Painter. I'm a 
law professor at the University of Minnesota. And from 2005 to 
2007, I was the chief White House ethics lawyer for President 
George W. Bush.
    In the White House Ethics Office one of our principal 
obligations was to make sure that senior appointees and 
nominees to the executive branch were free of financial 
conflicts of interest. The reason is that financial conflicts 
of interest in Federal office are a crime.
    Eighteen United States Code 208 makes it a crime for a U.S. 
Government official to participate in a particular matter that 
has a direct and predictable effect on the financial interests 
of that government official.
    That statute, it's a criminal statute, 18 United States 
Code 208--please read it, members of the committee and staff--
it applies not just to particular party matters, such as 
contracts and investigations, this criminal statute applies to 
generally applicable matters that have a direct and predictable 
effect on an identifiable class of persons or companies if the 
government official has a financial interest in the company.
    This is the reason why in the Bush Administration we never 
allowed the head of an agency to have any financial interest in 
a company that had substantial contracts with that agency.
    I certainly never allowed it. When I looked at the 
financial disclosure forms, and we sent those nominations on to 
the Senate, we would not have tolerated that, for anyone in the 
executive branch, whether or not nominated by the President, 
appointed by the President, or anyone else in a senior 
position. Why? Because there is a grave risk that that person 
will commit a crime when they're in office.
    How can you run the post office and make decisions about 
scheduling the mail, about the specification for contracts, 
about when the trucks leave, all of those decisions, if you own 
millions of dollars of stock in a company that is trucking the 
mail around? A contractor with a post office. It doesn't make 
any sense.
    So, either Mr. DeJoy, the Postmaster General, has not been 
doing his job over the past 13 weeks or so, or he has committed 
a crime that could be a felony. We should not be in that 
    Another thing we did in the Bush White House is we looked 
at the background of people who were coming into public 
service. We did not want to bring in people who had violated 
the law.
    I will not opine as to whether Mr. DeJoy violated campaign 
finance laws. I will say that if the stories reported in The 
Washington Post and The New York Times are true, or any piece 
of those stories is true, about reimbursement of employees for 
campaign contributions, that is a straw donor arrangement and 
that is a felony. People go to jail for that.
    So, we have a very real possibility--possibility, I'm not 
saying for certain, but a possibility--that the Postmaster 
General of the United States may have committed felonies before 
entering office and in office under 18 United States Code 208. 
In office.
    This is a grave situation. It requires investigation by 
this committee. It is your job to investigate. This is not a 
kangaroo court. I am offended as an American, and as having 
been a Republican for 30 years, to hear that language used. It 
is your job to investigate this.
    I have submitted an additional letter with Professor Claire 
Finkelstein with the University of Pennsylvania outlining 
additional concerns about the post office, and I will be open 
to your questions. This is a matter of grave concern for the 
American people, and I thank you for your time.
    Mr. Connolly. Thank you, Mr. Painter, for your testimony. 
And the chair will recognize himself for five minutes.
    Let me begin with you, Mr. Painter. We have heard that 
having a hearing that includes in large part an examination of 
the professional practices and potential conflicts of interest 
and allegations that have been corroborated by other members of 
the media, besides The Washington Post investigative team, with 
respect to illegal straw donations, do you believe that's a 
worthy subject of this committee and that it is, in fact, 
directly related to the operational changes undertaken by that 
    Mr. Painter. It certainly is a legitimate area of inquiry 
for this committee. The integrity of public officials in this 
country is critically important. That is why we screened out 
people with that type of background in the Bush White House. 
Why? Because we knew that, if we didn't, our officials would be 
sitting in front of this committee answering questions, because 
this committee is doing its job. That's what oversight is.
    And, yes, if you bring in someone who has committed 
campaign finance violations, who's willing to do anything, 
including violate the law, to elect someone who they want to be 
President or to win other elections, what's going to stop them 
from doing it when they run the government agency, whether it's 
the United States Postal Service or any other agency? So, yes, 
you are doing your job when you conduct these hearings.
    Mr. Connolly. Now, remind us again what your position was 
in the George W. Bush Administration.
    Mr. Painter. I was the chief White House ethics lawyer and 
associate counsel to the President.
    Mr. Connolly. A Republican President?
    Mr. Painter. Yes. And that was an appointment by the 
President. I was a member of the Republican Party. I've 
identified with the Republican Party for 30 years, up to 2018.
    Mr. Connolly. So, what we know just from the public record, 
if you were in that same position today, would that have raised 
flags for you? And what would you have done about it, in terms 
of the idea that this person could be named Postmaster General, 
or, for that matter, any position?
    Mr. Painter. Well, because Postmaster General is not 
actually nominated by the President--it's an appointment made 
by the board----
    Mr. Connolly. Right.
    Mr. Painter [continuing]. If we had heard about it, though, 
we would have contacted the board and made it very clear that 
it is unacceptable to have a Postmaster General who has any 
record of campaign finance violation.
    So, either that story in The Washington Post and The New 
York Times is true or it's not true, but we're going to find 
out before we nominate--before the board nominates someone. And 
financial conflicts of interest of this sort, absolutely 
unacceptable. It's a no-go.
    Mr. Connolly. Do you believe that the Board of Governors 
has a fiduciary responsibility to have done due diligence in 
terms of background checks on the Postmaster General before 
appointing him?
    Mr. Painter. Absolutely. I've taught corporate and 
securities law, and I work with nonprofit organization boards 
of directors. I'm on the audit committee of a big foundation. 
Directors have fiduciary obligations, and that includes 
investigating the background of the people appointed to senior 
positions and screening for financial conflicts of interest, so 
people are not violating the law when they're in their 
    Mr. Connolly. Mr. Fineman, you were chairman of the Postal 
Service Board of Governors. Is that correct?
    Mr. Fineman. That's correct.
    Mr. Connolly. And based on what we know from the public 
record and activities by this full committee and subcommittee, 
do you believe the Board of Governors, in fact, did its due 
diligence in a thorough background check before appointing Mr. 
DeJoy as Postmaster General?
    Mr. Fineman. What I hear--what's coming out in the press 
clearly were things the Board of Governors should have, and I 
would've expected they would have, found out had they done a 
proper investigation.
    Mr. Connolly. As former chairman of the Board of Governors, 
what is your view about the connection of the personal 
background, professional background of a candidate for 
Postmaster General and the potential connection with the 
operations of the Postal Service, which he or she would, in 
fact, theoretically head? Is there a connection?
    Mr. Fineman. Mr. Chairman, there certainly is a connection. 
I think that--I understand Professor Painter's point of view. I 
would extend it a little bit further. I would think that, if 
there is an apparent conflict of interest, we should not hire 
that person as a Postmaster General.
    You might ask why? Well, it's because the American public 
is entitled to have confidence that the mail is going to be 
delivered and it's not going to be in any way, shape, or form 
compromised by the actions of the Postmaster General.
    Mr. Connolly. Thank you, Mr. Fineman.
    My time is up.
    The chair now recognizes the distinguished ranking member, 
Mr. Hice, for his five minutes.
    Mr. Hice. Thank you, Mr. Chairman.
    I would like to note, just out of curiosity, if any of our 
witnesses today are currently employed by the USPS. Those 
online, if you could answer if you are.
    Mr. Plunkett. Not currently, no.
    Mr. Hice. All right.
    I would just like for the record to reflect that none of 
our witnesses today are employed by the Postal Service. Yet our 
hearing today is supposed to be about a postal update. And here 
we have no witnesses who are part of the Postal Service.
    In fact, we have witnesses who basically can do nothing on 
the issue of what this hearing really is turning into being--
they can do nothing but speculate. We have a law professor, a 
law school lecturer, who has determined guilt based from a 
Washington Post article.
    I counted at least two or three times, Mr. Painter, that 
you assumed guilt already to Mr. DeJoy. I don't see that as 
being very professional at all.
    This is not oversight. This is, again, an attempt to create 
political assassination, as I referred to in my opening 
    When it comes to the question of whether or not Mr. DeJoy 
broke any campaign finance laws, Mr. Painter, wouldn't you 
agree that, really, you have no more information than the 
general public has at this point?
    Mr. Painter. No, that is a false statement, and----
    Mr. Hice. You did two or three times, sir.
    Mr. Painter. I did not. And I'm going to repeat that I do 
not know whether the campaign finance laws were violated. It is 
a false statement that I assumed guilt.
    But if those stories are true, what is described in those 
stories is multiple felonies. It must be investigated.
    Mr. Hice. OK.
    Mr. Painter. It is unacceptable to have someone in a 
position of trust in our government who is suspected of those 
types of violations of the law, the same with respect to 18 
United States Code 208.
    I do not know for certain there has been a violation, a 
    Mr. Hice. Mr. Painter, you're answering questions I did not 
ask. I would appreciate your----
    Mr. Painter. You said that I assumed guilt. I did not. That 
is not true.
    Mr. Hice. You go back and read your statement, sir, because 
I'm going to go on with my questions here.
    Basically what we have, then, is your opinion, which is 
fine. You're certainly entitled to your opinion. But it's a 
hypothetical opinion at this point, because it's based on an 
article. There's not been any investigation that's come down to 
    Can you explain to me what XPO does?
    Mr. Painter. XPO, to the best of my knowledge, ships mail 
in trucks and performs other logistical operations for the 
United States Postal Service.
    Once again, I have not assumed that the Postmaster General 
has necessarily committed a crime, but the fact of the matter 
is, we have a contractor with large contracts with the Postal 
Service, and there is a very high degree of likelihood that a 
Postmaster General who is doing his job would be making 
decisions that have a direct and predictable effect on a 
contractor of that size with the Postal Service.
    Mr. Hice. So, are you qualified to evaluate whether or not 
the relationship between XPO and USPS has risen to the point of 
conflict of interest?
    Mr. Painter. Yes, I am, because I made that type of 
decision repeatedly for the Bush Administration. No one goes 
into a position, a high-ranking position----
    Mr. Hice. So, are you a member of the Board of Governors?
    Mr. Painter. I said I made that determination. You do not 
get that job if you keep stock at a contractor with your 
agency. That is a deal-breaker, because you could go into 
public office and commit a felony.
    And that I did repeatedly. I told people, you have to sell 
the stock. You don't go to the Department of Defense and own 
stock of defense contractors.
    Mr. Hice. I asked if you were qualified to make the 
assessment, and you're going back to your times in the Bush 
Administration. My question is on this particular situation. 
You're not a member of the Board of Governors. You are not part 
of the vetting. The Board of Governors did do vetting. They did 
look into these issues.
    Are you aware that Mr. DeJoy did divest certain assets that 
he had?
    Mr. Painter. Yes, I know he divested some assets, but 
that's not the point. He owns----
    Mr. Hice. Do you know which ones?
    Mr. Painter [continuing]. Contract stock in a company that 
has large contracts with the Postal Service. I am qualified to 
say that is unacceptable. It would've been a deal-breaker in 
the Bush Administration. We would not have nominated, 
appointed, or approved in any way of a senior executive branch 
official having that conflict of interest.
    Mr. Hice. You may not have; the Board of Governors did. He 
has divested other assets. When it came to XPO, the UPS cleared 
him to hold those assets.
    Now, whether it's wise or not I'm not getting into. But he 
made clear, transparent, he laid out there his assets, and he 
was cleared. Is that correct?
    Mr. Painter. Well, the Board of Governors made that 
decision, but I am here to say it's wrong. I am qualified to 
say it is wrong and it poses a grave risk that he could commit 
a crime when he's in office.
    Mr. Connolly. The gentleman's time has expired.
    Mr. Hice. Sounds like he just confirmed again his belief 
that a crime is committed.
    I yield back.
    Mr. Painter. I did not say that. I said a grave risk that a 
crime would be committed.
    Mr. Connolly. For the record, the chair heard Mr. Painter 
frame it in a hypothetical, ``if this were true.''
    The chair now recognizes the distinguished chairwoman, Mrs. 
Maloney, for her five minutes.
    Mrs. Maloney. Thank you very much.
    And I thank all of the panelists for their really important 
    Mr. Fineman, you have extensive experience with the high-
level inner workings of the Postal Service. You spent 10 years 
on the Board of Governors. You really are an expert on the 
Postal Service and the Board of Governors.
    I'd like to ask you about the process for selecting the 
Postmaster General. In your 10 years on the board, you were 
involved in the hiring of two Postmasters, one in 1998 and the 
other in 2001. Is that correct?
    Mr. Fineman. Yes. Yes, it is correct.
    Mrs. Maloney. During those selection processes, was it 
standard for the board to contract an outside firm to conduct 
the search?
    Mr. Fineman. Yes, it was.
    Mrs. Maloney. Well, that makes sense. The board is small 
and needs to perform an executive search for one of our 
country's most important independent agencies.
    Now, during our hearing on August 24, Chairman Duncan 
indicated that he put Mr. DeJoy's name into consideration after 
Russell Reynolds Associates had already provided a list of 
qualified candidates to the board for consideration. He went 
into detail: They had many people considered. They narrowed it 
down to 200, then to 50, then to 12.
    In either of your selection processes for Postmaster 
General that you participated in, did board members add 
candidates after the search firm had already done its work to 
narrow down the list of candidates, possible candidates?
    Mr. Fineman. To the best of my recollection, I do not 
remember anyone recommending anyone on a personal basis.
    And, quite frankly, if they did, it wouldn't come before 
the board, initially. It would go back to the search firm so 
that they could do their due diligence about the candidate.
    Mrs. Maloney. Thank you.
    The process the board followed in this instance, to me, 
seems very unusual. In your experience, how is the selection 
process for the Postmaster General supposed to work?
    Mr. Fineman. You hire an executive search firm. The 
executive search firm gives you a multitude of candidates. You 
narrow down that multitude of candidates. They do some 
interviewing. Then we come down to about, I don't know, 10 or 
so candidates that we interview, that the board interviews, and 
then a select----
    Mrs. Maloney. Well, Mr. Fineman----
    Mr. Fineman. Then we make a determination as to who we want 
to hire. And, in that process, we are getting information about 
the background of all of the individuals.
    Mrs. Maloney. Uh-huh. Thank you.
    Now, if you were still on the board, would you have gone 
out of your way to add Mr. DeJoy to the list of candidates? 
Would you have chosen him?
    Mr. Fineman. Let me first say that I would not have gone 
out of my way. If you're asking me whether I would have chosen 
him, the answer would be no.
    It's apparent that there was a conflict of interest to 
begin with, that he still had an interest in one of the largest 
contractors with the United States Postal Service. As I said 
before, it's not even the direct conflict; it's the appearance 
of a conflict which would concern me.
    And, second, if I can just say, if we leave aside the 
conflict issues, when you're looking for a Postmaster General, 
there's certain things that we look for. We look for 
communication skills. Am I going to--is the Postmaster General 
going to be able to communicate with the stakeholders of the 
Postal Service?
    Mrs. Maloney. Reclaiming my time, Mr. Fineman.
    Mr. Fineman. That means you and your Republican colleagues.
    Mrs. Maloney. OK.
    So, Mr. Fineman, we have requested information about the 
search from the board, but, to date, they have refused to 
provide us with any information at all. Do you think it is 
appropriate for the board to refuse to work with this 
committee, given the responsibilities that we have for 
oversight for the Postal Service?
    Mr. Fineman. Absolutely not. They should be giving you what 
you have asked for. And, quite frankly, they should be giving 
you more than you asked for.
    Mrs. Maloney. Thank you. Thank you very much.
    And very, very quickly, Mr. Plunkett, the metadata in your 
testimony says it was written by Jessica Lawrence. Who is 
Jessica Lawrence?
    Mr. Plunkett. She is my predecessor at my current position. 
I used a document template that had her name on it.
    Mrs. Maloney. So, she did not write it.
    Mr. Plunkett. No, absolutely not.
    Mrs. Maloney. She did not. OK.
    Mr. Plunkett. Absolutely not.
    Mrs. Maloney. My time has expired, but I really 
particularly want to thank everyone for being here today, 
especially Mr. Richard Painter.
    The Post Office should be a bipartisan, nonpartisan 
position that serves the American people, and you made that 
point very clear. I thank you for your service, for all the 
participants' service, and for your being here today. Thank 
    I yield back.
    Mr. Connolly. I thank the distinguished chairwoman.
    The gentleman from Alabama, Mr. Palmer, is recognized for 
five minutes.
    Mr. Palmer. I thank the chairman.
    First of all, this is all about politics; it's really not 
about the post office. And the witnesses reflect that. It's 
remarkable, some of the claims that have been made by these 
individuals and Ms. Graves' raising questions in her work about 
dark money and sources of funds, when her own organization 
received over $500,000 from outside sources.
    And Mr. Painter apparently thinks he's still campaigning 
for office. You're very animated in your responses, yet--and 
you want to tout your Republican credentials, when you ran for 
the Senate as a Democrat. And, in 2016, you filed a complaint 
claiming that James Comey violated the Hatch Act when he 
released information about the newly discovered emails on 
Hillary Clinton's computers.
    This just seems like it's not really about trying to 
resolve anything related to the post office. If it were, this 
would have been done years ago when, during the Obama 
Administration, they were going to shut down 3,700 post 
    I know Mr. Connolly cares deeply about this. And I think 
you and I and other members of this committee really want to 
see reform for the post office. But they were planning to cut 
$14 billion--I'm sorry, to cut $10 billion--$20 billion in cuts 
and close 3,700 post offices and cut 120,000 jobs. This is all 
documented in The Washington Post.
    Since we're using The Washington Post as a source, I've got 
multiple articles here from The Washington Post talking about 
the problems with the delay and delivery of mail, the changes 
that were being made, the closure of sorting facilities--not 
just taking sorting machines out, but closing facilities.
    Mr. Connolly. Would my friend yield for a minute?
    Mr. Palmer. I'll be happy to yield.
    Mr. Connolly. We'll freeze his time. Please freeze his 
    Just as a matter of record, it was not the Obama 
Administration; it was the Postal Service. And it was under the 
previous Postmaster General prior to Ms. Brennan, Mr. Donahue.
    I will point out, on a bipartisan basis, there was an 
uproar in Congress about it. And we got it stopped, because it 
was being done unilaterally, it was being done capriciously, 
and there was no consultation with Members or communities 
    I just wanted to make that point, because there was--Mr. 
Comer mentioned in our last hearing, where was the Democratic 
outrage then? Actually, there was a ton of it, and I was here 
for that, and it was on a bipartisan basis, because that 
Postmaster General didn't do his consultation with the 
administration or with Congress.
    I thank my friend for yielding, and his time is intact.
    Mr. Palmer. I appreciate your comments on that. It was an 
outrage with Congress.
    But the point is that the post office has had major, major 
problems for years and that we've been trying to sort through 
this in the most effective way that we can to resolve the 
problems for the post office. But now it has become political, 
when I would like to also point out that the changes that the 
current Postmaster General has been accused of making were 
implemented before he took office. He's the one that stopped 
them. So, to make that same point that you were making, I think 
we're trying to cast aspersions where they're not justified.
    As for these other issues, I just think that this has 
become so highly partisan and just adds to the divisiveness of 
what's going on in Congress that makes our ability to get 
anything done almost impossible. And to bring in witnesses who 
are as partisan as these witnesses are, this is not productive. 
This doesn't advance the agenda for the post office in any form 
or fashion.
    So, that's my problem with this hearing. I know, Mr. 
Chairman, where your heart is for reform, but, again, I just 
take exception at what I'm hearing here today.
    With that, I'll yield back.
    Mr. Connolly. I thank the gentleman.
    The gentlelady from the District of Columbia, Congresswoman 
Norton, is recognized for her five minutes.
    Congresswoman Norton, are you there?
    Ms. Norton. I'm trying to unmute.
    Mr. Connolly. We will return to Congresswoman Norton.
    Ms. Norton. Can you hear me now?
    Mr. Connolly. OK. Got it.
    Ms. Norton. Sorry about that. Sorry about that.
    Mr. Connolly. No problem.
    Ms. Norton. Mr. Chairman, I note that the ranking member 
wondered why you were having this hearing. And I simply want to 
commend you for this hearing. The Postal Service may be the 
most important agency in the United States today, when you 
consider the pandemic and how people are getting their 
medicines, not to mention the upcoming election. So, I 
appreciate this hearing very much.
    Let me go on to my first question.
    Mr. Chairman--rather, I'm sorry, Mr. Fineman, this question 
is for you, because, as a former chair of the postal Board of 
Governors, you will be particularly qualified, it seems to me, 
to answer this question. It has to do with privatizing the 
Postal Service.
    Now, I note that the reorganization document of the 
administration made it clear it wanted to privatize the Postal 
Service. Mr. Fineman, as the former chair of the Board of 
    Mr. Connolly. Can I interrupt you, Ms. Norton? Can you turn 
on your video, please?
    Ms. Norton. Oh, I'm sorry. I thought my--can you see me 
    Mr. Connolly. Not yet.
    Ms. Norton. Wait a minute. ``Start video.'' It says, 
``start video.'' And I have been on before. I've been on the 
whole time of this hearing.
    Mr. Connolly. I know. I know. But for some reason we do not 
see you.
    Ms. Norton. Can you see me now?
    Mr. Connolly. Not yet.
    Ms. Norton. I can see me.
    Mr. Connolly. And a beautiful image it is, I'm sure, but we 
have a technical problem here.
    Ms. Norton. I can see me on my screen, and I can hear me.
    Mr. Connolly. OK. Well, we're going to have to put up with 
technical problems. If there's no objection, the gentlelady may 
proceed. Hopefully her visual will come through shortly.
    Ms. Norton. Well, today, I'm better heard than seen.
    Mr. Connolly. Thank you, Ms. Norton.
    Ms. Norton. Mr. Fineman, I would like to know, since the 
notion of privatizing the Postal Service is on the 
administration's mind, who would benefit from privatizing the 
Postal Service, Mr. Fineman? And who, if anybody, would lose?
    Mr. Fineman. Well, let's start with your first question, 
who would benefit. More than likely, the private delivery 
services would benefit. As you raise the prices of the Postal 
Service and as you diminish its capability, more and more 
people will go through the private delivery services to get 
their mail delivered, their packages delivered, et cetera. And 
that's who would benefit.
    So, let's talk about whose services would be diminished. 
Particularly rural America.
    I don't know if Congressman Keller is still there.
    Congressman, I know your district, Sullivan County, 
Pennsylvania, where I've spent a fair amount of time. It's one 
of the most beautiful places in America. And those people will 
not get mail on a regular basis if it's privatized. The same 
goes for people in Potter County.
    And, Congresswoman Holmes Norton, let me just say, your 
constituents will not get mail on a regular basis if it's 
privatized. People in the inner city, people in north 
Philadelphia, in west Philadelphia, they're not going to get 
mail on a regular basis. Why? Because it's not profitable to 
private delivery companies to deliver mail regularly, 
universally to the inner city and to rural America.
    Quite frankly, one of the largest customers over the years 
of the United States Postal Service has been private delivery 
companies. Because when they have packages that they do not 
want to deliver, you know who they give it to? They give it to 
the United States Postal Service, because they're going to 
deliver packages into Montana, packages into Iowa. And the 
private delivery companies can't make money doing it. They 
can't fill that truck with enough packages to go into rural 
America to deliver packages.
    Ms. Norton. You've made a very important point, this kind 
of last-mile delivery to places in the United States where it 
is clearly unprofitable, and yet they see their mail every day, 
the way I do here in a big city. Very important, it seems to 
me, to note.
    Mr. Graves, could you speak to the concerns that the Board 
of Governors--that a member of the Board of Governors or a 
Member of Congress or a member of the public would have with a 
candidate like Mr. DeJoy who invests in companies that benefit 
from Postal Service contracts or would benefit if the Postal 
Service moves to privatization?
    Ms. Graves. Thank you so much, Congresswoman, for your 
    I think that it's important for the American people to 
understand that it is a tremendous conflict of interest, as the 
other witnesses have testified to, for a Postmaster General to 
have millions of dollars in stock in a company that does 
business with the U.S. Postal Service.
    In fact, one of the things that XPO Logistics does with its 
hundreds of contracts it's had with the Postal Service, 
including revenue of between $22 million and $37 million a 
year, is that it helps deliver the postal--it helps deliver the 
mail during peak holiday times and presumably during elections.
    Here we are, with a Postmaster General who has been 
appointed to this position in part--or basically because he's a 
donor to this President. He was chosen and steered through that 
process by Mike Duncan, who is the man who helps, to this day, 
Mitch McConnell stay in power in the U.S. Senate.
    So, when Congressman--pardon me--one of the Congressmen 
mentions the politicization of the Postal Service and says that 
it comes from this committee, I would say to you that, in fact, 
it's coming from the Postal Service at its helm, through the 
selection of Mr. DeJoy by Mr. Duncan, whose term, by the way, 
has been configured so that he will serve until 2025 unless 
he's removed.
    So, you have a Postmaster General and a chairman of the 
board who are the most political people to ever hold this 
position in its history, since the 1970's, since those reforms. 
And you have this pattern now, this summer, of these 
precipitous changes and edicts by Mr. DeJoy that have 
demonstrably affected the American people, have affected senior 
citizens and veterans in the delivery of vital medicines and 
more. Yet Mr. DeJoy----
    Mr. Connolly. Thank you.
    Ms. Graves. Oh, sure.
    Mr. Connolly. I'm sorry, but the gentlelady's time has 
    Ms. Norton. I apologize. I said Mr. Graves; it's Ms. 
    Mr. Connolly. Thank you.
    The gentleman from Pennsylvania, Mr. Keller, is recognized 
for his five minutes.
    Mr. Keller. Thank you, Chairman.
    I would like just to get at things. I know my district has 
been brought up or the people that I represent have been 
brought up, Sullivan County, Potter County, all 15 counties, 
which I do advocate for the people every day. That is my job, 
and I will continue to do that.
    But I wish that the people on the other side of the aisle 
would have the same concern to make sure that my constituents 
get mail, to make sure that we stand up for the hardworking 
people of the United States post office that process and 
deliver our mail and do all the good work, and get down to, 
really, postal reforms, which is what I thought this hearing 
was about. But somehow it has devolved into political 
contributions and accusations that were put out in the print of 
The New York Times and The Washington Post. So, I'm a little 
disappointed with where we're headed with this.
    But since we're there, Mr. Painter, you brought up 
accusations in The Washington Post and New York Times. Are you 
aware that they ever publish stories that were then found not 
to be true? It's an easy question, yes or no. Have they--are 
    Mr. Painter. I do not know whether this story is true or 
    Mr. Keller. No, that's not the question. Sir, the question 
is, yes or no, have you ever been made aware that they may have 
published something that was later out not to be accurate?
    Mr. Painter. I think every newspaper in the country----
    Mr. Keller. OK. That's good. I'm done.
    Mr. Painter [continuing]. Has done that once in a while.
    Mr. Keller. I'm done. OK.
    Mr. Painter. And I didn't say it's true. I said, if true, 
it's a crime.
    Mr. Keller. Well, again, I wish we were getting down to the 
issue of making sure the post office has the tools it needs to 
perform its job. But since we're on political contributions, 
I'm going to ask a few questions.
    Mr. Fineman, have you ever made political contributions to 
political campaigns?
    Mr. Fineman. Absolutely.
    Mr. Keller. OK. What party?
    Mr. Fineman. Both Democrats and Republicans.
    Mr. Keller. Have you contributed to any Democrats this 
    Mr. Fineman. Yes.
    Mr. Keller. Quite substantially, actually.
    Mr. Fineman. I don't think--well, I'm happy to tell you 
what I've contributed so far, if you'd like.
    Mr. Keller. I have the record right here.
    Mr. Fineman. I understand, but if you'd like me to tell 
you, I'm happy to tell you, Mr. Keller.
    Mr. Keller. Ms. Ravel, have you contributed to political 
    Mr. Plunkett. I'm sorry, was that question directed to me?
    Mr. Keller. Ann Ravel? Ravel?
    Ms. Ravel. I'm on the phone.
    Mr. Keller. Excuse me? I didn't get the answer.
    Mr. Connolly. Ms. Ravel, could you repeat your answer?
    Ms. Ravel. I'm sorry. The question was, have I contributed 
to campaigns?
    Mr. Keller. Yes.
    Ms. Ravel. I have.
    Mr. Keller. That's the issue we're talking about today.
    Ms. Ravel. Yes, I have.
    Mr. Keller. OK.
    Ms. Ravel. Yes, I have.
    Mr. Keller. Ms. Graves?
    Ms. Graves. I have not contributed $600,000 to the election 
of Donald Trump. Mr. DeJoy has. And, in fact----
    Mr. Keller. Yes or no, campaigns?
    Ms. Graves [continuing]. I have not made any contributions 
in this cycle, Mr. Keller. But I would note that you've 
received $10,000 from----
    Mr. Keller. Yes or no is the answer--is the question.
    Mr. Richard Painter, have you contributed to campaigns?
    Mr. Painter. Yes.
    Mr. Keller. OK. Thank you.
    Mr. Painter. Thousands of dollars to Republican campaigns.
    Mr. Keller. Thank you.
    Mr. Plunkett, have you contributed to campaigns?
    Mr. Plunkett. Small amounts, yes.
    Mr. Keller. OK.
    Again, I would think that, rather than having people that 
have contributed to campaigns, we ought to have people in here 
that understand the Postal Service and understand how we're 
going to make reforms so that this can be sustained.
    I've heard much testimony today tearing down character 
based upon stories written in newspapers and other items. If 
anybody has done anything illegal, I'll be the first one to 
tell you that they should be held accountable to the fullest 
extent of the law.
    But we should also be, and what I thought we were looking 
at, was making sure that the United States Postal Service 
provides the good service that they do for a very, very long 
period, taking care of our constituents that rely on that and 
also taking care of the good people that do the work every day. 
But we are not here doing that. We're here doing many other 
things, and it's, quite frankly, disappointing.
    The other thing I would like to say--and I'm very committed 
to making sure that we had--the issue of prepay of benefits. 
It's a serious thing, when the fund that pays for post-
employment benefits is in danger of running out of money in the 
upcoming years. And it's not prepayment of benefits. It's, when 
an employee is hired, you make a contribution now so that, over 
time, when they retire, there are adequate funds available to 
pay for that employee's benefits.
    Those are the things we should be discussing. We should be 
discussing how we work together across the aisle to make sure 
that those things are accomplished, not all the other things 
that have gone on.
    But I guess I've proven my point. And if it's about 
political campaigns, maybe we ought to adjourn this meeting and 
go on to a meeting where we can actually get down to the 
business of solving the issues with the United States Postal 
    Thank you, and I yield back.
    Mr. Connolly. I thank the gentleman.
    As the co-author of the major reform bill that was co-
sponsored by my friend Mark Meadows, I assure the gentleman 
from Pennsylvania of the commitment of this subcommittee chair 
and, I know, of the full committee chair to postal reform.
    I would also note for the record, the issue before us that 
was being discussed was not whether somebody made a political 
campaign contribution. There's nothing wrong with that. The 
question alleged in The Washington Post and The New York Times 
and other media outlets was whether straw donations occurred--
whether, in fact, there was, A, pressure or coercion and, 
second, a violation of the law by covering those donations 
through bonuses or a salary. That is illegal. And that was what 
was being pursued, not whether somebody made a contribution.
    Mr. Keller. And, Mr. Chairman, if I can, though--if I can, 
though, in the United States of America, under our 
Constitution, people are presumed innocent until proven guilty. 
And they are not supposed to be proven guilty or innocent by a 
newspaper article.
    Mr. Connolly. That's right. And, for the record, this 
committee of jurisdiction has an ethical obligation to examine 
charges that may be made about somebody who has a 
responsibility for running one of the largest enterprises in 
the country, including serving your district as well as mine.
    Mr. Keller. They should. Then let's get down to that, and--
    Mr. Connolly. We're doing it.
    Mr. Keller [continuing]. Let's call the people that can 
testify to that and not an innuendo in a newspaper.
    Mr. Connolly. Mr. Keller, that is precisely what we're 
doing. You're trying to discredit this examination as having 
nothing to do with the operations of the Postal Service, and 
with that, respectfully, I disagree.
    The chair now recognizes the gentleman from Maryland, Mr. 
Sarbanes, for five minutes.
    Mr. Sarbanes. Thanks very much, Mr. Chairman. Can you hear 
    Mr. Connolly. Yes, we can, and we can see you.
    Mr. Sarbanes. Excellent. Appreciate the hearing.
    As you know, Mr. Chairman, on August 24, in front of the 
full Oversight Committee, Postmaster General DeJoy and the USPS 
Board of Governors testified. And, at that hearing, Mr. DeJoy 
stated, quote, ``I have no patterns of misconduct in my 
background,'' end quote.
    Well, obviously, based on what we know now, based on some 
of the testimony we're getting today, we know that assertion is 
patently absurd. In fact, amidst the endless parade of 
conflicts of interest that we have seen from the Trump 
administration, Mr. DeJoy's conduct really sinks to new depths.
    So, let's look at some of this. I want to pick up on this 
straw donor situation that we have been talking about.
    Mr. DeJoy was chairman and CEO of New Breed Logistics from 
1983 to 2014. As the Post has reported, between 2000 and 2017, 
he may have allegedly operated this kind of straw donor scheme 
at his company by reimbursing employees in their salaries for 
contributions they made to Republican candidates.
    Ms. Ravel, if the reports from The Washington Post about 
Mr. DeJoy are true, and knowing what you do about campaign 
finance law, would you say that those actions would qualify as 
    Ms. Ravel. Yes, Congressman Sarbanes. If they are true, and 
since they quoted employees who indicated that there is 
veracity to it, it would certainly qualify as criminal conduct, 
in addition to civil.
    So, there is no question about it, which is why, in my 
testimony, I quoted the Department of Justice, who, in 2017, 
indicated that these sorts of schemes are clearly illegal and 
that they are, in fact--over $10,000, that person could be 
convicted and sent to jail for two years, and even more, which 
is what's alleged in this case, for five years.
    So, I think they're very serious allegations, and I think 
that they----
    Mr. Sarbanes. In fact, the----
    Ms. Ravel [continuing]. Need to be investigated.
    Mr. Sarbanes. Thank you for that. The Post found that, 
between 2000 and 2014, 124 individuals who worked for the 
company, together, gave more than $1 million to Federal and 
state GOP candidates. And this is worth noting: Many of these 
individuals had not previously made political donations, and 
they've not made any political donations since leaving the 
    So, something was going on there, and as a former 
commissioner of the Federal Election Commission, I'd be 
interested in knowing from you whether, if the allegations are 
true, exactly how does Mr. DeJoy's action violate the Federal 
election laws? What's the chapter and verse on that, in terms 
of these straw donor schemes?
    We're not hearing you.
    Ms. Ravel. Oh. So sorry. Although--I'm so sorry for the 
sound in the background.
    It is illegal and a felony to reimburse contributions. 
There is no question about that. If it is serious and willful, 
that's what the law provides.
    When a person contributes--wants to contribute to a 
campaign but doesn't want to disclose that they're the donor, 
either because it's an illegal contribution from corporations 
or for some other reason that they don't want to be identified, 
the statute is extremely clear that that is, on its face, 
illegal. And----
    Mr. Sarbanes. Let me jump in, Ms. Ravel. Let me jump in 
real quick, because I want to get something on the record from 
    If the FEC should hold Mr. DeJoy accountable, who is 
culpable in situations like this, where employers are being 
paid back through the company for political contributions they 
make? And what would you say to employees who are wrestling 
with whether to come forward and provide information about this 
straw donor scheme?
    Mr. Connolly. The gentleman's time has expired, but the 
witness may respond.
    Ms. Ravel. Thank you.
    When the CEO is pressuring employees to make these kinds of 
contributions, it is the CEO who is culpable. That is very 
clear in the law.
    If the recipient committee knows that they received the 
money through a fraudulent scheme, they should refund the money 
to the original source or disgorge it. But, again, given the 
information we know, it would not eliminate the culpability of 
the person who engaged in the straw donor scheme.
    Mr. Sarbanes. Thank you.
    Mr. Connolly. Thank you.
    The gentleman from Wisconsin, Mr. Grothman, is recognized 
for his five minutes.
    Mr. Grothman. Thank you.
    I have some questions for Mr. Plunkett, but, first of all, 
I'd like to thank Mr. Palmer for his questions. It really 
shouldn't matter, the political background of someone, but I 
had been left under the impression that Mr. Painter was a 
Democrat. Unless Mr. Palmer had brought up that he had--was a 
Republican, unless Mr. Palmer brought up that he had run for 
U.S. Senate, I never would have dreamed from his testimony.
    Mr. Painter. Mr. Chairman, I'm not a Democrat. I'm an 
independent. That's just not true. I ran in an open primary as 
an independent.
    Mr. Grothman. OK. But not a Republican.
    Mr. Plunkett, a lot of the attention----
    Mr. Connolly. I'm sorry, did you say you were an 
independent, Mr.--no.
    Go ahead, Mr. Grothman. Excuse me.
    Mr. Grothman. Are you an independent? Is that what you're 
saying now?
    Mr. Painter. I was a Republican for 30 years until 2018. I 
became an independent in 2018 because of my disgust----
    Mr. Grothman. OK.
    Mr. Painter [continuing]. With what's happening----
    Mr. Grothman. OK.
    Mr. Painter [continuing]. In the Republican Party.
    Mr. Grothman. OK. I was under the impression you ran in the 
Democratic primary.
    OK. Mr. Plunkett, a lot of the attention to the post office 
has come because Postmaster General DeJoy is trying to rein in 
cost. Do you feel his cost-control measures benefit mailers and 
anyone using the postal system?
    Mr. Plunkett. Well, certainly, any efforts that make the 
Postal Service more efficient redound to the benefit of all 
users of the system.
    Last week, the Postal Service's Office of the Inspector 
General issued a report showing that, from 2014 to 2019, 
overtime usage had increased at the Postal Service by 30 
percent despite the fact that mail volume declined in every one 
of those years.
    So, we care very much that efforts are maintained to keep 
the Postal Service efficient and to remove unnecessary costs.
    Mr. Grothman. So, you don't feel there's been any 
sabotaging of the post office or the mail? You feel that the 
things that have been done so far are moving things in the 
right direction?
    Mr. Plunkett. I would say the things we've observed so far 
are very consistent with similar efforts in the past under 
different Postmasters General and were not all that surprising, 
to be honest.
    Mr. Grothman. OK. How long have you been involved in postal 
    Mr. Plunkett. I've been in my current position--this is my 
fifth year, and I worked for the Postal Service for 
approximately 28 years.
    Mr. Grothman. So, I guess if anybody should know about the 
Postal Service, it should be you.
    How long has the Postal Service lost money?
    Mr. Plunkett. Oh, I think every year going back to at least 
    Mr. Grothman. OK. Could you give me some suggestions, how 
you feel that they can get a handle on costs?
    Mr. Plunkett. Well, I certainly think efforts to increase 
productivity would be beneficial and are much-needed. I would 
encourage the Postal Service to concentrate its efforts on 
making its last-mile delivery network as efficient as possible.
    As I said in my testimony, I think there are things that 
Congress could do that could relieve some of the unnecessary 
and burdensome retirement funding that would benefit the 
    I also think we really need to take a look at the Postal 
Service's universal service obligation and determine exactly 
what the American public needs in the 21st century. It really--
it goes back to 1970, and it needs some reexamination.
    Mr. Grothman. OK.
    It looks as though the Postal Service determined that $25 
billion in a five-year period was paid for overtime and that 
the amount of employees who earned more overtime than straight 
pay increased by 430 percent during that time.
    How can we get those costs under control? Do you have any 
specific ideas on the overtime?
    Mr. Plunkett. Well, you know, the report was maybe not as 
detailed in providing complete answers as to how that should 
take. I think, you know, for example, some of the things that 
we know the Postal Service is attempting to do--taking out 
excess equipment, eliminating unnecessary transportation 
trips--all of those things can help, and all need to be done to 
ensure that the costs of the Postal Service remain under 
    Mr. Grothman. OK. I've always had a good experience with 
the post office. I know some of the postal workers in my 
district tell me that they're getting more overtime than they 
want. Of course, some people always love the overtime. But, 
overall, I think in my life I've had one letter not delivered 
to me on time.
    Do you feel, overall, the post office is doing a good job 
delivering the mail?
    Mr. Plunkett. In general, yes, the Postal Service delivers 
mail very well, especially first-class mail. I think they've 
been tested because the increase in packages that they're 
seeing as a result of the pandemic is not really what their 
network was designed for. But, overall, the Postal Service does 
an excellent job delivering mail.
    Mr. Grothman. And just to emphasize, I go back to a vote we 
took a couple weeks ago. Is it really true the Postal Service--
I know people are trying to get them billions of dollars more 
money. But is it really true that their sales have gone up the 
last--since the pandemic?
    Mr. Plunkett. Actually, yes. In the last few months, Postal 
Service revenues are above plan and above last year. So, 
they're exceeding revenue expectations.
    Mr. Grothman. Thank you very much.
    And thank you for the time, Mr. Chairman.
    Mr. Connolly. Thank you, Mr. Grothman.
    I will enter into the record what has already been entered 
into the full committee record, the service performance 
measurement, a briefing of the Postmaster General by the Postal 
Service, which shows, contrary to what Mr. Plunkett asserted, 
quote, ``a sharp decline in service since week 41,'' which 
happens to be the same week in which Mr. DeJoy took over the 
Postal Service. And it consistently shows a fairly substantial, 
7-to-8 percent, decline in service below the baseline. So, it's 
not a normal fluctuation, according to the Postal Service's own 
    I enter that into the record.
    Mr. Connolly. I now call--well, Ms. Speier, you're next, 
but I understand you have yielded to Mrs. Lawrence. Thank you 
so much for your courtesy, and you will be right after Mrs. 
    Mrs. Lawrence, welcome.
    Mrs. Lawrence. Thank you so much.
    I just want to say, as we're having this dialog, let's not 
forget that this is an election year. We're being confronted 
with voting by mail. And Mr. DeJoy--just like we mentioned, 
there should be a comprehensive plan. We all are in support of 
postal reform. I've sat in those committees with Congressman 
Meadows, at that time, and with the leadership of Congressman 
Connolly, and that we are committed to that. Why didn't DeJoy 
do his job and present to us his plan for a comprehensive 
reform of the Postal Service? I would be glad to have that 
    But, today, we're here in the midst of a President of the 
United States continuously attacking the Postal Service and its 
longstanding ability to service the people.
    So, we are doing our job. If the President is saying that 
the Postal Service is not operating, if we have a Postmaster 
General who is not doing his job and has admitted that he 
doesn't understand the Post Office, and we're sitting here 
today saying we need postal reform, then that's what we're 
supposed to be doing. I join my colleagues in saying we will 
have that conversation any day of the week.
    So, with that being said, recently, millions of Americans 
received a mailer from the United States Postal Service urging 
people to vote by mail. Not surprisingly, Mr. DeJoy does what 
he has done in other situations: He did not consult with the 
key stakeholders. So, he actually mailed a mailer that tells 
the American people across the country, even though we have 
different--every state has established their own plan--that 
says request your mail-in ballot or your absentee ballot at 
least 15 days before election day, where we have states like 
Colorado who mails everyone an absentee ballot application. We 
did it here in Michigan. So, are you saying you have--an 
absentee ballot is being mailed to you; now go call your state 
and request the ballot? It is confusing.
    I'm going to ask Ms. Ravel: Given the circumstances 
surrounding Mr. DeJoy's actions and just the conflict that we 
are seeing, the Voter Integrity Commission, what should we be 
doing as Members of Congress to ensure that these actions that 
we continue to see will not continue to be a form of 
oppression, as some are calling it? Others are seeing it as a 
way to interfere in the voting process. Can you give me your 
educated opinion on what's happening?
    Ms. Ravel. Yes. Thank you. I was the recipient of one of 
those, and I know a lot about voting, and yet I was confused as 
to why they were telling me this. Because I live in California, 
where everyone gets a ballot.
    So, I absolutely think that it is so important that, if Mr. 
DeJoy is not held accountable, either by this public discussion 
of his behavior, alleged unethical behavior--but I believe 
there is sufficient evidence to see that--is that Mr. DeJoy, 
rather than acting independently, because of his campaign 
finance conflicts, will do whatever it takes to appease the 
person who got him where he is, the President, in particular 
with regard to the opposition to mailed ballots and his 
attempts to undermine the trust and confidence that people have 
in our electoral system.
    We know that, when people believe that there is going to be 
an issue with the electoral process, often, it is essentially 
voter suppression. It leads them not to vote because of fear of 
voting, or, in the case of the mail, that they're concerned 
that they will need to expose themselves to COVID-19 instead of 
mailing in order to cast a vote.
    So, it is really important----
    Mr. Connolly. Thank you. The gentlelady's time has expired.
    Mrs. Lawrence. Thank you.
    Mr. Connolly. Thank you, Mrs. Lawrence.
    Mrs. Lawrence. Thank you, Mr. Chairman.
    Mr. Connolly. The chair recognizes the distinguished 
ranking member for a unanimous consent request.
    Mr. Hice. Thank you, Mr. Chairman.
    Just to bring clarification to the point that Mr. Grothman 
brought up, I'd like to ask unanimous consent for two articles: 
the first from The Washington Post, entitled, ``Meet Richard 
Painter, the Anti-Trump Former Republican Who Is Running for 
Senate As a Democrat''; the other from The Washington Post, 
which is the Minnesota primary election results, which itself 
has Mr. Painter registered as a Democrat.
    I thank the chairman.
    Mr. Connolly. The chair would----
    Mr. Painter. Excuse me. That's not true. I did not register 
as a Democrat.
    Mr. Chairman, may I respond? Because he is challenging the 
credibility of my testimony.
    Mr. Connolly. As a matter of factual record, Mr. Painter, 
do you wish to correct the record?
    Mr. Painter. Yes, I do.
    And the chairman of the Minnesota Democratic Party, Ken 
Martin, publicly chastised me for refusing to say I was a 
Democrat and used that against me to beat me in that primary 
against Senator Tina Smith. I refused to say I was a Democrat.
    In Minnesota, we have open primaries. I have the right as 
an independent to run in a Republican primary or a Democrat. 
And I will choose to do so in the future if I want to. That is 
my right in the state of Minnesota.
    Mr. Connolly. I thank the gentleman.
    Mr. Hice. Mr. Chairman, I respect that right. I was just 
clarifying Mr. Grothman's point with these two unanimous 
consent articles, and I would ask them to be----
    Mr. Connolly. Without objection.
    Mr. Hice. Thank you, sir.
    Mr. Connolly. And the chair will add to that unanimous 
consent request a series of articles: one from CNN on 
``Financial disclosures reveal Postmaster General's business 
entanglements and likely conflicts of interest.''
    The second is the article by Heidi Przybyla on ``Postal 
contracts awarded to DeJoy-run company were questioned in 2001 
Postal Service audit.''
    Then there is, from The Guardian, ``Trump's postal chief 
ousted brother to win control of family firm, court files 
    Then, finally, The Washington Post article that has been 
referred to on multiple occasions on Mr. DeJoy's ``rise as GOP 
fundraiser was powered by contributions from company workers 
who were later reimbursed, former employees say.''
    Without objection, all of those articles will be entered 
into the record of this hearing.
    Mr. Connolly. The chair now recognizes the gentlelady from 
California, Ms. Speier, for her five minutes.
    And thank you for your patience.
    Ms. Speier. Thank you, Mr. Chairman.
    Thank you all for being here today.
    I, too, have a number of entries that I would like to make 
into the record. One is the ``Tips for Treasurers'' from the 
FEC, ``Contributions in the name of another is strictly 
prohibited''; also, the FEC complaint filed by CREW against Mr. 
DeJoy; and, also, a letter from the Project for Government 
    Mr. Connolly. Without objection, those documents shall be 
entered into the record.
    Ms. Speier. Thank you, Mr. Chairman.
    Let me also enter into the record the actual postal 
customer postcard that I received that has been the topic of 
conversation here this morning.
    It appears the Colorado Secretary of state attempted to get 
the Postmaster to correct the postcard for Colorado voters, and 
it was ignored, and the USPS mailer was being presented ``only 
as a recommendation,'' whatever that means.
    So, I would like to----
    Mr. Connolly. Without objection.
    Mr. Connolly. And let the record show the chairman also 
received that postcard in Virginia.
    Ms. Speier. All right. Let me go to Ms. Ravel.
    As a former FEC Director, you know the law very well. You 
indicated that, if, in fact, employees were coerced--and you 
included in ``coercion'' the word ``implied''--if they had a 
fear of being fired or if they would not be promoted.
    We do know that there is a human resources director of Mr. 
DeJoy's former company that has made these statements.
    Would you agree or maybe firm up what you mean by 
``implied''? So, the fact that you don't complain about it but 
are fearful that you may lose your job or not be promoted would 
be implied coercion? Is that correct?
    Ms. Ravel. Well, let me say that the Department of 
Justice's discussion of this issue made it very clear that, 
just asking, it's implied. And because of the unequal 
relationship between a boss, an employee, that in itself is 
    Ms. Speier. So, just asking is coercion.
    Thank you very much.
    Ms. Ravel. Yes.
    Ms. Speier. And then the other thing that's very 
interesting, if, in fact, you then either provide them a bonus 
at the end of the year, you get a business tax deduction as the 
employer. Is that not correct? So, they're lots of violations 
going on here, it would appear.
    Let me move on then to Mr. Painter.
    You were a former White House ethics lawyer, associate 
counsel to George W. Bush. You were a Republican for 30 years. 
You are now an independent, let's make that clear to everybody.
    Let me ask you this. Mr. DeJoy has retained his interest of 
anywhere between $30 million and $75 million in the company XPO 
Logistics. We also know that the Postal Service has paid XPO 
$33 million to $45 million annually since 2014, including for 
highway route contracts.
    So, records show a surge in revenue for XPO for the Postal 
Service since Mr. DeJoy took over on June 15. The Service paid 
XPO Logistics and its subsidiaries about $14 million over the 
past 10 weeks. If you go back to the same period of time last 
year, it was only $3.4 million.
    Mr. Painter, does that create a conflict of interest?
    Mr. Painter. Well, it sounds like somebody is making a lot 
of money. The conflict of interest is created by the fact that 
the Postmaster General has a financial interest in a company 
that's contracting with the Postal Service. And, obviously, if 
he is making any decisions that have a direct and predictable 
impact on that company, he violates the criminal conflict of 
interest statute.
    Now, whether the violations occurred or not, I cannot opine 
for certain, and I cannot opine for certain that those 
violations have added to the profitability of the company. I 
could just say that somebody is doing very well.
    But it's illegal for any U.S. Government official to 
participate in a particular matter that has an effect on their 
financial interest. And I'm afraid there's a grave risk that 
the Postmaster General could be doing just that.
    Ms. Speier. Thank you. My time has expired. I yield back.
    Mrs. Maloney.
    [Presiding.] Ms. Plaskett, you are now recognized. 
Congresswoman Plaskett? I believe we'll come back to her.
    Congressman Khanna. Ro Khanna? We will come back to him.
    Congressman Raskin. Representative Raskin, are you with us?
    Mr. Raskin. Yes, indeed, Madam Chair. Thank you very much.
    Mrs. Maloney. You are now recognized.
    Mr. Raskin. I appreciate it. Thank you for calling this 
astounding hearing.
    Postmaster General Louis DeJoy has between $30 and $75 
million invested in his former company XPO Logistics, which is 
a major private contractor of the U.S. Postal Service. Last 
year, he made somewhere between a million and a half and $11 
million from XPO in dividends and gains.
    Mr. Painter, you were George W. Bush's chief White House 
ethics counsel, his ethics adviser. Would you have signed off 
on Louis DeJoy's appointment as Postmaster General if you had 
been advising the Board of Governors, or even if you had been 
in the administration, without his commitment to divest the $30 
to $75 million that he owns, in stock, in this private 
contractor that gets contracts from the post office?
    Mr. Painter. Absolutely not.
    Mr. Raskin. Well, how could--could you tell us how----
    Mr. Painter. And indeed the Governors might have contacted 
the White House to ask about this type of situation, and we 
would have told them no way.
    If someone has stock in a contractor, they must divest if 
they want a job with the agency. That was a position of the 
Bush Administration. That is a rule I never, I did not see 
violated once.
    Mr. Raskin. Well, could a Secretary of Defense have taken 
office, while you worked for President Bush, while he was 
invested or she was invested in millions of dollars in defense 
contractors working with the Department of Defense?
    Mr. Painter. The position of the Bush White House is no go, 
we're not going to nominate that person, unless they agreed to 
sell the stock, all of it, every last penny. They get a tax 
benefit, by the way, too, for selling it. So, there's no excuse 
not for selling the stock. No, they would not have gotten the 
job in the Bush Administration.
    Mr. Raskin. Mr. Painter, how did this happen?
    Mr. Painter. This happened because the Board of Governors 
chose to appoint Mr. DeJoy, and this was not a Presidential 
appointment, so it didn't go through the Office of Government 
Ethics. The Office of Government Ethics never had a chance to 
review this.
    I don't think there's any way the Office of Government 
Ethics would have signed off on an agency head who has large 
amounts of stock in a company that's contracting with the 
agency. It's a nonstarter. But they bypassed that, the Office 
of Government Ethics, because the Board of Governors made the 
decision on their own, with their own lawyers looking at it, 
and they, quite frankly, came up with a wrong conclusion.
    Mr. Raskin. Some of our colleagues seem very angry at you 
that you are a--you were a high-ranking Republican official in 
a Republican administration, you were a Republican for 30 
years, now you're an independent. But they seem to think that 
we should set ethics aside and just stand by our political 
    Tell me why you think it's important, as someone who has 
devoted his life to ethics, that we place ethical conduct in 
public office ahead of our partisan allegiance.
    Mr. Painter. The criminal conflict of interest statute is 
not about partisan politics. It's about the integrity that the 
American people expect in government. And we have the right to 
have a government with agencies run by officials who are free 
of conflicts of interest.
    We also have the right to a post office that is not 
politicized. And I've documented in detail with a letter with 
Professor Claire Finkelstein that is attached to my testimony 
the concerns we have about the politicization of the post 
    And I have to say that when we have to worry about whether 
we're Democrats or Republicans when it comes to delivery of the 
United States mail, this country is in serious trouble.
    Mr. Raskin. Well, why has the U.S. Postal Service not 
released Mr. DeJoy's ethics documents, even in redacted form? 
Should they do that?
    Mr. Painter. The United States Postal Service should 
release all of the ethics documents, all of the communications 
about the clearance of Mr. DeJoy immediately to this committee 
so this committee can conduct a proper investigation, which is 
what you are paid to do on this committee, as our 
Representatives, to investigate allegations of corruption and 
violations of ethics rules in the government. All of those 
documents should be produced to this committee immediately.
    Mr. Raskin. Ms. Graves, the Office of Government Ethics has 
yet to certify Mr. DeJoy's financial statements. Is that a 
problem? Is that something that should happen?
    Ms. Graves. Yes, that's definitely a problem, Congressman, 
and for us to be at this point in his tenure as Postmaster with 
these questions unanswered for you and for the American people 
is simply unacceptable.
    Mr. Raskin. Would you think that this is----
    Mr. Connolly.
    [Presiding.] The gentleman's time has expired.
    Mr. Raskin. I yield back then, Mr. Chairman. Thank you.
    Mr. Connolly. Thank you, Mr. Raskin.
    The gentleman from Tennessee, Mr. Cooper, is recognized for 
his five minutes.
    Mr. Cooper. Thank you, Mr. Chairman. I almost thought my 
day was never going to come here.
    I appreciate this excellent hearing, and I would like to 
urge the chair both of the subcommittee and of the full 
committee to consider calling as witnesses the 124 employees 
who worked for New Breed or XPO who were encouraged/coerced 
into contributing, and according apparently to the former H.R. 
manager of that firm, were reimbursed, not only in whole, but 
even the taxes were paid on their extra compensation, which is 
a little bit like committing a crime and then tying a bow on 
top of it to present.
    It's an extraordinary thing. So, I think this committee has 
a special opportunity here to find out the truth in this 
matter. And perhaps Mr. DeJoy will be completely exonerated. 
But to have 124 employees put in this situation, in aggregate 
about a million dollars of contributions, this is a substantial 
sum of money.
    But in an effort to be constructive, I think the single 
point of bipartisan consensus here is that this House passed 
H.R. 2382 this winter with 309 votes of substantial 
bipartisanship, and that would relieve the post office of this 
annual $5 billion straitjacket that it's required to wear and 
has been wearing since 2006. This is a requirement, as the 
chair well knows, that no other Federal agency, no private firm 
has to wear a straitjacket of this type.
    So, business always talks about level playing field and no 
unfair advantages. This is a crippling blow to our post office.
    One of the witnesses testified earlier that the post office 
has basically, since 2008, been losing money. One of the 
primary reasons is this annual $5 billion charge that is 
completely unfair to require of the post office if no other 
Federal agency and no private firm is required to pay this 
    Mr. Connolly. Would my friend yield?
    Mr. Cooper. I'd be delighted.
    Mr. Connolly. I couldn't agree with him more. And I would 
just point out, because my friend Mr. Hice has talked about 
comprehensive reform, one of the sticklers that's preventing 
comprehensive reform from coming to the floor is this very 
issue, because it involves Medicare, it involves a cost by CBO, 
even though it shouldn't, and it ultimately would involve the 
signing off by the Ways and Means Committee, which has been 
very difficult to achieve.
    So, I completely agree with my friend. Thank you for 
bringing it up.
    Mr. Cooper. To put a finer point on it, never has the post 
office been led by more partisan people, or people closer to 
the current Senate Majority Leader, Mr. McConnell. And yet he 
is the one who is refusing to even consider this legislation, 
which if it passed the House so overwhelmingly, and in a 
bipartisan fashion, presumably would have substantial support 
in the Senate.
    So, it's a particular irony that Mr. Duncan, who is from 
Kentucky and one of Mr. McConnell's closest friends, and Mr. 
DeJoy, who is at least a solid member of that team, are unable 
to persuade the Senate Majority Leader to move that crucial 
piece of legislation which could do more to restore the 
competitiveness of the post office than any other single 
    Another point I think that's come up in this hearing so far 
is that, not only as Ms. Speier pointed out, is XPO possibly 
overcharging the post office today. It was revealed this 
morning by NBC News, as I think Mrs. Lawrence pointed out, that 
20 years ago New Breed, Mr. DeJoy's prior company, was 
overcharging the post office because somehow he got a no-bid 
contract, and the IG, under the Bush Administration, where Mr. 
Painter worked as well, thought or concluded that the post 
office was probably being overcharged $53 million, and that was 
20 years ago.
    So, this is an extraordinary thing, to have someone who's 
probably overcharged the post office, according to the post 
office IG, $20 million--or $53 million 20 years ago--suddenly 
gets promoted to be Postmaster General? This is a history of 
wrongdoing even if you disregard the straw man contributions.
    So, this is an extraordinary situation, to have the post 
office led by someone, as I think Mr. Painter succinctly 
summarized, who has committed probably felonies before and 
during his tenure as Postmaster General. Never has the post 
office been so poorly led.
    So, I think the committee has a lot of work to do. There 
are ways that we can combine with our Republican friends to 
solve problems, like by relieving the post office of this $5 
billion annual obligation, but first we've got to make sure 
that the post office is not being led by criminals. This is a 
real problem.
    So, I thank the chair.
    Mr. Connolly. I thank the gentleman from Tennessee. Was 
that a question you were putting to Mr. Painter?
    Mr. Cooper. Well, he would be welcome to opine.
    Mr. Connolly. Mr. Painter, you may respond, even though the 
gentleman's time has expired.
    Mr. Painter. I am very concerned that there is a grave risk 
that there are ongoing violations of 18 United States Code 208. 
I have not opined as to whether for certain that certainty 
occurred. And I am very concerned of the reports of conduct 
which, if true in connection with contributions, would be 
illegal straw donations in violation of Federal election laws, 
also a felony.
    I am going to ask the chairman to introduce into the record 
to clarify my testimony and the truth of my testimony, which 
has been challenged before this committee, an article in the 
Minneapolis Star Tribune, August 1, 2018, ``DFL in Bitter Clash 
with Senate Candidate Richard Painter,'' saying, quote, ``Party 
Chair Ken Martin, called Painter, quote, 'a wolf in sheep's 
clothing,' end quote, who refuses to say he is a Democrat.''
    That's where we are in this country, partisan politics out 
of control. I'm attacked by the party chair in Minnesota for 
running in an open party, for refusing to say I'm a Democrat. 
And then I have to come before this committee, and have my 
testimony and the validity of my testimony challenged by 
Republican members of this committee who don't bother to do 
their research.
    I am an independent and I am an American. And I am 
disgusted with what's happening in the post office and in other 
parts of this administration.
    Mr. Connolly. Without objection, the article to which you 
refer will be entered into the record.
    Mr. Connolly. I must observe, ironically, I hope we don't 
get back to the point where we start asking witnesses, ``Are 
you now or have you ever been a member of a particular party?'' 
But that's a different subject for a different time.
    For the record, Mr. Painter insists he is not a Democrat 
and has entered into the record the conflict with the DFL 
chairman in Minnesota as evidence thereof, and we accept that.
    Thank you, Mr. Painter.
    The Chair now recognizes the gentlewoman from Florida, Ms. 
Wasserman Schultz, five minutes.
    Ms. Wasserman Schultz. Thank you, Mr. Chairman.
    Mr. Connolly. If we could begin Ms. Wasserman Schultz's 
time over again. Start--there we go. Thank you.
    Ms. Wasserman Schultz. Out of practice.
    Mr. Connolly. Wait a minute, did you say you were on your 
    Ms. Wasserman Schultz. No, I wanted to make sure it was not 
going to ring.
    Mr. Connolly. Oh, oh, oh, I can't believe that.
    Ms. Wasserman Schultz. You don't want to hear this phone 
ring in the middle of this hearing, trust me.
    Well, good afternoon. Thank you, Mr. Chairman, and I 
appreciate the indulgence in allowing me to waive onto the 
subcommittee for purposes of asking a question. Because there 
really cannot be a more critical time for the Postmaster 
General to cooperate with this committee in order to ensure 
that the American people are able to have confidence in the 
United States Postal Service, that it is functioning properly 
and prepared to meet the demands of the moment.
    However, instead of taking reasonable steps, like 
soliciting an advisory opinion before implementing operational 
changes, complying voluntarily with document requests, or 
listening to the needs of local plant managers, Mr. DeJoy's 
alarming lack of transparency and accountability has created 
more doubt about his motivations every step of the way.
    I got a personal taste of this stonewalling earlier this 
month, when I was denied entry to two south Florida United 
States Postal Service facilities when I arrived to observe the 
morning shift. There was absolutely no justification for 
turning me away. My office provided advance notice, well in 
advance notice to the USPS management. I had USPS employees 
with me who were able to escort me throughout the facility. I 
posed no risk to anyone's health or safety. I have toured USPS 
facilities in the past without being informed of any notice 
    The key difference from past visits is that we now have a 
Postmaster General who prefers to hide the damage he has caused 
and continue to carry out the implicit orders of our lawless 
    Mr. Fineman, as a former Chairman of the Postal Service 
Board of Governors, I want to ask you about the value of 
transparency in postal operations. Does the USPS have the duty 
to be transparent when it makes operational changes that affect 
mail service?
    Mr. Fineman. Absolutely. First of all, it has an obligation 
as a matter of law to be transparent. And, second, it just 
seems to me that I cannot understand why you would not be 
transparent with this committee and with other committees, just 
to tell people what's going on.
    And right now, we're in the middle of an election season. 
The American public deserves to know that it is going to be 
able to have a fair and equitable election. And in order to 
have that happen, we need a Postmaster General who is going to 
communicate with all the stakeholders that are interested in 
making sure that happens, and that includes you, Madam 
    Ms. Wasserman Schultz. Thank you, Mr. Fineman.
    And beyond any statutory obligations to obtain public 
comment, what are the financial or reputational benefits of the 
USPS being transparent with this committee and the American 
public, would you say?
    Mr. Fineman. You know, it's a question of, who are your 
customers? The Postal Service has thousands of stakeholders, 
Parcel Shippers Association, the First Class mailers, the 
unions, and others, and it is important that those people 
understand what is going on with the Postal Service and 
understand it in a regular and--a regular basis.
    But now it's even more important. There shouldn't be a 
woman who comes up to me and says, you know, I'm going to push 
my 80-year-old mother to vote, and we're going to stand in 
line, and I don't care how long it takes, because I'm scared 
that the Postal Service is not going to deliver my ballot on 
election day. That's scary. I say to her, you can't risk that. 
Get your ballot in early, et cetera. But people are scared.
    Ms. Wasserman Schultz. Mr. Fineman, as we move closer to 
the Presidential election and continue to deal with the COVID-
19 pandemic, how concerned are you about the continued report 
that sorting machines are not being utilized to their maximum 
extent, even in the face of admitted delays by Mr. DeJoy and 
slowdowns of the mail delivery?
    Mr. Fineman. I listened to the last hearing, and I remember 
you saying that you went into a facility and they were just 
    Ms. Wasserman Schultz. I had photos of that.
    Mr. Fineman. It just seemed to me, why can't you plug them 
back in and bring a technician in? It would take such a short 
period of time, and the American public would feel confident 
and feel more confident that their right to vote was not being 
    Ms. Wasserman Schultz. And the mail would be less likely to 
be delayed. Yet, Postmaster General DeJoy said that he would 
not allow local managers to plug those sorting machines back 
in. Very transparent what's going on here.
    Thank you so much for your previous service and for your 
answers to my questions.
    I yield back the balance of my time.
    Mr. Connolly. I thank the gentlelady. And the gentlelady is 
correct that as a matter record, in response to Mr. Lynch's 
question, the Postmaster General flat out refused, on the 
record, under oath, before this committee, full committee, to 
reconnect those sorting machines that had been disconnected.
    Ms. Scanlon, the gentlelady from Pennsylvania, I believe I 
saw you. Are you there?
    Ms. Scanlon. Yes. Thank you. I think I have to read a 
motion in Rules. And I am virtually in two different hearings. 
Hold on one second.
    Mr. Connolly. Ms. Scanlon. Ms. Scanlon, you're muted. Can 
you unmute? Ms. Scanlon, we cannot hear you.
    Ms. Scanlon. I'm sorry.
    Mr. Connolly. There you go.
    Ms. Scanlon. I have to appear in Rules right now. I'm so 
    Mr. Connolly. Well, while Ms. Scanlon is clarifying that, 
I'd like to insert into the record at this time statements in 
support of the hearing from Citizens for Responsibility and 
Ethics in Washington, Candlelight (phonetic) Marketing 
Economics, and two recently released reports by Lisa Graves. 
Without objection, so ordered.
    Mr. Connolly. Is Ms. Scanlon prepared to join us? She is 
not. OK.
    Let me just add, if I may, for the record, Mr. Plunkett, 
you indicated, I think, that the Postal Service did not 
necessarily need or didn't need the revenue stabilization of 
$25 billion that's in the Heroes Fund.
    For the record, that $25 billion was the recommendation of, 
of all people, the Postal Board of Governors. It was not a 
Democratic idea. It was actually by the Republican majority 
unanimously, by the way, of this Board of Governors. It 
recommended $25 billion revenue stabilization, which is 
included in the Heroes Act. It recommended $25 billion for 
infrastructure, which is in the Infrastructure Act. And it 
recommended an unfettered access to the $10 billion line of 
credit that Mr. Hice mentioned--unfettered. And we tried to act 
on those two and put the infrastructure piece in the 
infrastructure bill.
    Mr. Hice. Would the gentleman yield really quickly?
    Mr. Connolly. Yes. Of course.
    Mr. Hice. Just for clarification, that request was before 
the effects of COVID were realized. So, the context of the 
request, I think, is important to understand.
    Mr. Connolly. Well, I am so glad the gentleman brought that 
up again. Because, again, Mr. Plunkett mentioned the $13 
billion cash on hand as if somehow that solves our problems.
    I would point out, for the record, that the payroll of the 
Postal Service, every two weeks, is $2 billion-plus. So, $13 
billion is six payrolls. It's hardly a panacea. And, again, 
they've benefited, as my friend knows, from a surge in package 
    Now, just as that appeared, unpredictably, it could 
disappear, unpredictably. Especially, as we all hope, when the 
pandemic ends, what happens to that package demand? We don't 
know. But it's an uncertain thing to rely on and it's not a 
long-term stable solution for the Postal Service, which I know 
my friend from Georgia wants to address as well.
    So, I just want to put that on the record in terms of 
context of facts.
    Mr. Plunkett. If I may clarify?
    Mr. Connolly. What's that?
    Mr. Plunkett. If I may clarify, Congressman?
    Mr. Connolly. Of course, yes.
    Mr. Plunkett. My testimony agrees that we support targeted 
relief for the Postal Service to the extent required by the 
additional costs they have incurred as a result of the 
    I should point out, we do not always agree with the Postal 
Service or its Board of Governors. And yes, the 13 billion only 
covers a short amount of time in terms of postal spending. But 
they are taking in revenue far in excess of expectation over 
the last few months, and the most recent evidence is that 
package deliveries continue to run about 40 percent over normal 
    So, while I agree there is a need to address the long-term 
challenges faced by the Postal Service, we need to be careful 
how we do so.
    Mr. Connolly. Yes. Was there somebody else there?
    I would just, to underscore the uncertain nature, though, 
of relying on packages in the pandemic, you know, the President 
of the United States had said many things about the Postal 
Service, one of which was that their problems would all go away 
if we simply tripled or quadrupled the cost of package 
    And as I know Mr. Plunkett knows, if we, in fact, acted on 
that recommendation, we'd talk ourselves right out of package 
delivery for the Postal Service. We'd hand over all package 
delivery to private sector competition because we'd price it so 
far above the market.
    And as I know Mr. Plunkett knows, pricing by the Postal 
Service is determined by the Postal Regulatory Commission by 
law, not by the White House, not by Jeff Bezos, there aren't 
sweetheart deals, despite what the President of the United 
States has insisted.
    So, getting the price right and hoping that this market 
surge represents a new plateau is an uncertain thing to base 
the entire future on. And that's why we believe that we need to 
stabilize the Postal Service for a much longer period of time 
to make sure we get through the pandemic, to make sure that we 
clarify that all of the resources are there for the Postal 
Service to guarantee reliability during the election, and that 
we can buy some time to develop a new business model for the 
21st century.
    With that, everybody has five legislative days with which 
to submit additional written questions.
    And, Mr. Plunkett, there may be some for you from my 
friend, Congressman Steve Lynch of Massachusetts, who could not 
be here, just to alert you that might happen.
    Those questions will be forwarded to the witnesses through 
the chair. I would ask all witnesses who get such questions to 
try to be as speedy as they can in providing responses.
    With that, this hearing is adjourned.
    [Whereupon, at 2:36 p.m., the subcommittee was adjourned.]