Trump is rethinking his plan to privatize the USPS, an initial plan that didn’t get far

President-elect Donald Trump says his next administration will reconsider plans for possible privatization of the Postal Service after repeated reviews of the agency’s operations during his first term.

The first Trump administration unveiled plans to restructure and potentially privatize USPS as part of a 2018 government restructuring plan, but the proposal never gained momentum after opposition from unions and Congress.

“There’s talk of privatizing the Postal Service, you know that – not the worst idea I’ve ever heard,” Trump told reporters at Mar-a-Lago on Monday. “It’s very different today between Amazon and UPS and FedEx and all the things that didn’t exist. But there is talk about it. It’s an idea that many people have liked for a long time. We’ll look into it.”

The Washington Post reported Saturday that Trump discussed privatizing the USPS with transition officials — including Howard Lutnick, co-chair of his transition team and Trump’s nominee to lead the Commerce Department.

Mark Dimondstein, president of the American Postal Workers Union, said in a statement Monday that privatizing USPS is the “last thing we should be thinking about as a country.”

“Privatization would end universal service. Currently, the USPS delivers to every address, regardless of who we are or where we live. Universal service is particularly important for rural America. Privatization would also lead to price gouging by private companies,” Dimondstein said.

APWU represents more than 200,000 active and retired USPS employees and nearly 2,000 private sector postal workers.

House Republicans, particularly those who support Trump’s new Department of Government Efficiency, expressed support for privatizing some USPS operations at a hearing last week.

House Oversight and Accountability Committee Chairman James Comer (R-Ky.) told Postmaster General Louis DeJoy that USPS was “bleeding red ink” and suggested the agency privatize its mail processing operations.

“There are private companies that are interested, and that’s where I think most of the problems lie,” Comer said at a Nov. 10 hearing.

However, Comer declined to support a plan to privatize the entire agency.

“When we talk about efficiency, especially members on this side of the aisle, we think about privatization, and people will say, ‘We should privatize the post office.’ The problem is that no one wants to deliver mail to every home in America six days a week and run all of these retail postal facilities. There is no private company in the world that wants this,” he said.

Government Operations Subcommittee Chairman Pete Sessions (R-Texas), one of the three co-chairs of the DOGE Caucus in Congress, called on DeJoy to name a contact at the USPS to work with the new caucus.

The DOGE Caucus will support the Trump administration’s Department of Government Efficiency, an advisory council outside the federal government led by billionaire businessmen Elon Musk and Vivek Ramaswamy.

Sessions told Federal News Network that the DOGE Caucus intends to take a closer look at USPS operations and find ways to make the agency more efficient.

“Government efficiency is important. Workforce and personnel issues are important, and money is important,” Sessions said. “I told (DeJoy) that essentially what I would like to see him create is a point of contact where we can take these ideas, rather than a more bureaucratic response system that doesn’t give us answers today.”

USPS is an independent agency that is generally self-funded but reports to Congress and the federal government.

The President appoints and confirms the Senate members of the USPS Board of Governors, which functions like the board of trustees of a private company.

Congress passes legislation that impacts USPS operations. In 2006, lawmakers required the USPS to prefund its retiree health benefits well in advance, adding to its annual losses. Congress passed a postal reform law in 2022 that eliminated this prefunding mandate.

The Postal Regulatory Commission oversees USPS pricing and performance.

Additionally, the White House generally avoids interference with the day-to-day operations of the USPS. Before 1970, the Post Office was a cabinet-level federal agency that received taxpayer money.

However, Trump has repeatedly commented on USPS operations. In 2020, he said he would block the Treasury Department from giving USPS $10 billion in emergency pandemic aid unless the agency agreed to a significant increase in its package prices. USPS ultimately received emergency funding without raising prices.

In a sweeping government restructuring plan during his first term, Trump proposed a major restructuring and possible privatization of the USPS, noting that the agency was experiencing more than a decade of net losses at the time.

Trump has launched a USPS task force led by the Treasury Department to examine ways to restructure the agency. In its recommendations, the task force urged the USPS to rely on contractors to process and sort mail.

USPS hires contractors to handle shipping and logistics work, but DeJoy has begun outsourcing some of those operations.

In the Trump administration’s 2018 government reform plan, the Office of Management and Budget wrote that USPS was “caught between the mandate to operate like a business but with the costs and political oversight of a public agency.”

“A private postal operator that delivers mail fewer days per week and to more central locations (not door-to-door delivery) would operate at a significantly lower cost,” OMB wrote.

OMB added that most international postal operations have undergone significant restructuring, “including reducing their physical and personnel footprints.”

The 2018 report said a privatized USPS would have more freedom to set higher prices for mail and package delivery, but would still receive some price control from the Postal Regulatory Commission or another agency.

OMB wrote that under this new model, a private USPS could reduce costs more by engaging in more comprehensive negotiations over wages and benefits, “rather than mandating participation in costly benefit programs for federal personnel and allowing them to defer to them on compensation and labor relations.” “To maintain private sector practices.”

According to the 2018 report, declining mail volumes are making it more difficult for USPS to provide the same services as other federal employees while delivering to every address at least six days a week.

“USPS can no longer meet the obligations arising from its enormous infrastructure and workforce needs,” OMB wrote.

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