[Congressional Record Volume 142, Number 92 (Thursday, June 20, 1996)]
[Extensions of Remarks]
[Pages E1144-E1145]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




              SUPPORT THE POSTAL SERVICE CORE BUSINESS ACT

                                 ______


                           HON. DUNCAN HUNTER

                             of california

                    in the house of representatives

                        Thursday, June 20, 1996

  Mr. HUNTER. Mr. Speaker, I rise today to introduce legislation to 
protect a small business industry from unfair Government competition. 
These small businesses exist in every congressional district and employ 
tens of thousands of people. The Government agency which is competing 
with them is one of the largest organizations in the world--the U.S. 
Postal Service [USPS]. My bill will insure that the Postal Service does 
not compete with these small businesses, while still maintaining the 
viability of the Postal Service to maintain its core business: the 
delivery of mail.
  Over the last 15 years, the American marketplace has fostered many 
new industries; one of these is the commercial mail receiving agent 
[CMRA]. The average American knows these businesses by their brand 
names: MailBoxes, Etc; Postal Annex; PostNet; Pakmail; and Parcel Plus. 
Together these franchise organizations represent over 4,000 store 
owners in all parts of the country, with an additional 6,000 stores 
which are not affiliated with any franchise organization. The CMRA 
industry is about 10,000 strong.
  What are CMRA's? This industry provides value added and ancillary 
services to postal customers and serve as mini-offices for many home-
based businesses and sales people. Specifically, CMRA's provide the 
materials and help their customers safely pack parcels to ensure safe 
delivery; they help customers identify the most efficient and cost 
effective manner to send their packages; they oversee mailboxes and 
offer personalized postal services to their customers; and these are 
just to name a few. Over 15 years ago, Tony DeSio saw the need for 
these services within his community of San Diego County, and he opened 
the first Mailboxes Etc. The rest, as they say, is history.
  These services simply were not provided at the USPS, however, given 
the rate by which this industry has exploded in less than two decades, 
there were clearly a need within our communities. This new kind of 
postal store provided these services and provided them quickly and 
efficiently. In a very short time, this one small store has grown into 
an industry of nearly 10,000 small business men and women who every day 
provide these services to their friends, neighbors, and customers.

  So what is the problem here, Mr. Speaker. So far, this story sounds 
like the American dream. Every day, American small business owners 
invest their own capital and work to achieve the American dream. That 
would be the case in this instance if it were not for one major 
problem: the Postal Service which has enormous taxpayer supported 
advantages, has decided to directly compete with this industry.
  Mr. Speaker, that is simply wrong. I am a big supporter of the U.S. 
Postal Service. Like every other Member of this body and every 
American, I depend upon the hard work and dedication of the Postal 
Service employees for the timely delivery of my mail 6 days a week, and 
I want a strong USPS. I do not think it is fair, however, that the 
Postal Service should start targeting small businesses for its revenue. 
This CMRA industry is home grown, and it should not be preyed upon by 
the U.S. Government.
  After all the USPS is a government industry with the following 
enormous advantages:
  The USPS does not charge tax on its retail items--that is a 5-10 
percent advantage right there.
  The USPS is self-insured as an agency of the U.S. Government--these 
small business CMRA's have to purchase insurance.
  The USPS does not have to make a profit--there is nothing that 
requires them to be profitable as far as I know. When they are under

[[Page E1145]]

threat of not breaking even, they request a postal rate increase.
  The USPS borrows money from the U.S. Federal Reserve at the most 
favorable rates--CMRA's have to borrow money at market rates.
  The USPS has a statutory monopoly on the delivery of first class 
mail, the revenue of which can be used to subsidize other services.
  Perhaps the biggest advantage of all is its size. If the Postal 
Service was a private business, it would be ranked as the 12th largest 
business in the Nation, and 33d largest in the world.
  Is it right that the Postal Service should enter into competition 
with small businesses with all of these inherent advantages? Would the 
Congress stand by and allow Ford to maintain a monopoly, while letting 
them use their profits to compete against small businesses on a 
different front? Would the Congress let Exxon compete with small 
businesses if it had limited sovereign immunity and was represented by 
the Department of Justice? The answer is a resounding no.
  Mr. Speaker, the Postal Service has a job to do--deliver the mail and 
sell postage. That is what it was designed to do by the Founding 
Fathers. These core services are what the Postal Service is good at, 
and what it should continue to do. Offering ancillary services only 
detracts from their core mission.
  My bill, the Postal Service Core Business Act, specifically prohibits 
the USPS from getting into the CMRA business. It addresses the question 
of what is the proper role for the Postal Service in areas where 
private industries already provide the service. That role is to stay 
out of private businesses way and let the marketplace work.
  My bill is remarkably simple. The Postal Service is prohibited from 
competing with private industry, like the CMRA's, unless the Postal 
Service was offering the service nationwide as of January 1, 1994. The 
purpose of the bill is to draw a clear line as to what the USPS can and 
cannot do.
  Such a line is necessary. I am familiar with reports of postal 
executives stating that they need to get into retail businesses to 
protect the Postal Service. That is simply not true. This is an agency 
which made $1.5 billion last year and has stated that it expects to 
make in excess $500 million this year. This is not a suffering agency.
  Furthermore, the USPS is an agency which does not seem to understand 
its mission. Representatives of the Postal Service have lauded the 
organization as the country's largest retail distribution system with 
50,000-plus outlets, and announced their intention to increase its 
retail revenue by $1 to $1.5 billion in the next few years. This is 
wrong. All of those outlets were built with taxpayer money and stamp 
revenue. The U.S. Government and the taxpayer built this system, but 
not to be a competitor with the private sector.
  Mr. Speaker, this is a vital bill. I again voice my strong support 
for the Postal Service, I want to help it remain strong and vital. 
Competing in industries which the private sector has created is not the 
way to meet their goal. My bill would redirect the Postal Service to 
its core mission: Mail delivery and stamp sales. That's why I call the 
bill the Postal Service Core Business Act of 1996. American 
corporations have learned that to be successful, they must concentrate 
on their core business. The Postal Service needs to understand this 
too.
  Congress has the ultimate authority over the Postal Service. The 
House Postal Service Subcommittee, chaired by my friend and colleague, 
John McHugh, is beginning to craft postal reform legislation. I hope 
that the subcommittee will give my bill serious consideration. This 
issue needs to be addressed. A vital Postal Service is critical to our 
Nation's future, but Congress must not stand by and let a giant 
Government agency destroy a whole industry of small private businesses. 
It is interesting to note that all of these CMRA's stores are 
independently owned and operated. There is not one franchise 
organization which runs stores as a corporation. This makes the 
industry very unique, and has directly contributed to their 
profitability.
  Mr. Speaker, there is not a single congressional district without at 
least one of these CMRA stores within its borders. Therefore, I urge my 
colleagues to join me in this legislation, which will most assuredly 
effect a small business within their hometown. This bill is pro-Postal 
Service and pro-competition. Every American has the right to the 
American Dream. These small business owners look to us to insure that 
their dream is not taken from them.

                          ____________________