US Postal Service faces major changes amid efficiency push and talk of privatization

ISTANBUL

The controversial head of the US Postal Service says it will be working with Elon Musk’s much-criticized cost-cutting team to make the service more efficient while shedding thousands of jobs in the short term.

In a letter to Congress on Thursday, Postmaster General Louis DeJoy said Musk’s unofficial Department of Government Efficiency will "assist us in identifying and achieving further efficiencies," including enhancing the management of the service’s retirement assets and the Workers' Compensation Program, as well as addressing the agency’s legislative mandates and regulatory requirements, CNN reported.

The Musk team “was gracious enough to ask for the big problems they can help us with,” DeJoy wrote in the letter. “It has long been known that the Postal Service has a broken business model that was not financially sustainable without critically necessary and fundamental core change.”

DeJoy, appointed by US President Donald Trump in 2020, in his first term, attracted controversy for having investments with 14 companies that have done business with the US Postal Service, as well as for alleged campaign finance violations. Ahead of the 2020 presidential elections, he was criticized for destroying mail-sorting machines that could have been used for mail-in ballots, a form of voting Trump has lambasted.

DeJoy last month announced his intention to step down as Postmaster General.

The postal service, an independent government agency, has cut around 30,000 employees since 2021 and plans to reduce another 10,000 through a voluntary early retirement program in the next 30 days, according to DeJoy. The agency currently employs about 635,000 workers.

- 'Privatization would hurt rural communities'

In the letter to Congress, DeJoy states that postal service’s retirement assets and Workers’ Compensation Program have been “mismanaged,” creating a financial hole.

He also criticized the Postal Regulatory Commission, calling it “an unnecessary agency that has inflicted over $50 billion in damage to the Postal Service by administering defective pricing models and decades old bureaucratic processes that encumber the Postal Service.”

Musk recently suggested privatizing the US Postal Service and Amtrak. The service is four years into its "Delivering for America" initiative to improve efficiency, but has faced criticism for poor mail performance. In polls, however, about three-fourths of the US public rates the postal service as “excellent” or “good.”

Despite being self-funded, the service has been losing money for years, though it reported $144 million in net income for the last quarter of 2024. DeJoy said fixing the organization, with its $100 billion losses and regulatory challenges, is a difficult task.

Democrats criticized the plan, with Rep. Gerry Connolly warning that privatization would harm rural communities who rely on the postal service for essential services, stating, “Reliable mail delivery can’t just be reserved for MAGA (Trump’s ‘Make America great again’) supporters and Tesla owners.”

Trump has proposed changing the postal service, including giving the commerce secretary authority over the independent agency, which could be a step toward privatization. This shift could disrupt critical services like mail deliveries, online purchases, prescription drugs, checks, and vote-by-mail ballots.