A Printing Industry Without Postal Reform?

There has been a lot of talk lately about the “Fiscal Cliff.” Many of us lack confidence that our lawmakers will unite to avoid a certain recession trigger.

There hasn’t been as much talk about our industry’s own fiscal cliff: What happens if we don’t get postal reform by the end of the year? Like so many in our industry, I’ll admit that I’ve been asleep at the wheel, complacently assuming the problem will get solved. Unfortunately, this is far from assured. If we lack confidence that our lawmakers won’t spin us into certain recession (clearly an issue that will generate more press coverage, public outcry and legislative attention), how can we possibly delude ourselves into thinking they will come together on postal reform?

The stakes are high for our industry, with 65 percent of ALL print distributed through the USPS system. What would happen if the system shuts down? Within the next year, that is a REAL possibility and we must not continue to ignore it.

While the Senate has already passed a bill, the House has yet to do so. There is a constituency in the House that believes a national post office is no longer necessary; there are others who believe we need dramatic efforts to right-size the service and implement labor saving technologies. Still others are merely happy to kick the can down the road, yet again.

The point is this: postal reform means different things to different people, and the ticking we hear is either the countdown of the clock…or the countdown of a bomb that could explode our industry. So what are the likely scenarios?

1. The House passes a bill, it’s reconciled with the Senate version, and we get the status quo—uninterrupted postal service.
2. No bill is passed before the end of the year. We start over in the new legislative session, potentially with a Congress that won’t be as sympathetic to our cause. In this scenario, we’d be lucky to eke out a bad bill at the midnight hour to prevent a complete collapse.
3. No bill. The USPS collapses, probably by next October when it can’t pay its bills.

What happens to print in scenario number three? People will pay their bills online, read their periodicals on tablets, and CMOs everywhere rejoice that they get to cut a big line item out of their budget and reallocate marketing dollars to other channels and tactics.

From foresters to paper mills to the printers, ink suppliers to postal workers, the biggest losers will be concentrated at the bottom of the supply chain. Mail owners can reallocate spend and deliver their message via alternative electronic or interactive means. But printers, papermakers, and foresters have no product to deliver without the USPS as a distribution mechanism.