USPS Collaborates with Elon Musk's DOGE Team for Operational Reforms

In a significant move to tackle its ongoing financial challenges, the United States Postal Service (USPS) has entered into a partnership with the DOGE government reform team, led by Elon Musk. Postmaster General Louis DeJoy announced this collaboration during a congressional session, highlighting the necessity for assistance as the agency grapples with substantial operational issues.

USPS, which operates independently with a workforce of 635,000, reported a staggering loss of $9.5 billion in the previous fiscal year. Despite these financial troubles, the agency has not been subjected to the federal employee reductions mandated by DOGE initiatives. In a letter addressed to Congress, DeJoy indicated that USPS is set to reduce its workforce by 10,000 employees through a voluntary early retirement program, initially introduced in January. This reduction follows a trend with the agency having already cut 30,000 jobs since 2021.

The agreement with the DOGE team, in conjunction with the General Services Administration, aims to enhance efficiency within USPS operations. DeJoy expressed appreciation for the DOGE team's willingness to address significant challenges faced by the agency. He pointed to various issues, such as the management of retirement assets and workers' compensation programs by other federal agencies, unfunded mandates, and excessive regulatory burdens.

DeJoy has spearheaded a comprehensive restructuring plan for USPS over the past five years, which has included significant workforce reductions and renegotiation of contracts. His efforts have reportedly halved projected losses from $160 billion to $80 billion over the next decade, utilizing strategies similar to those employed by the DOGE team.

In his remarks, DeJoy criticized the Postal Regulatory Commission, labeling it as an unnecessary entity that has caused substantial financial damage due to outdated pricing models and bureaucratic processes. The commission, however, countered his statements, asserting that USPS had squandered $100 billion in financial assistance from Congress and the commission itself, resulting in increased losses and decreased efficiency, particularly affecting rural communities.

Representative Gerald Connolly, the leading Democrat on the committee overseeing USPS, expressed concerns about the influence of DOGE within the agency. He suggested that the collaboration could lead to an undermining of USPS operations, potential privatization, and profit motives at the expense of American citizens.

Recent reports have indicated that former President Donald Trump was considering actions to restructure the Postal Service further, including potentially merging it with the U.S. Commerce Department--an idea that has been met with significant pushback from Democrats who argue it would contravene federal law. Musk, a prominent figure in the Trump administration, has previously advocated for the privatization of USPS.

Commerce Secretary Howard Lutnick has suggested that USPS could play a role in reducing costs within the department by providing personnel for tasks such as conducting the U.S. census and performing duties currently managed by 20,000 Social Security employees.

Amid these developments, USPS is implementing new service standards expected to yield savings of at least $36 billion over the next decade. The agency has incurred losses exceeding $100 billion since 2007 and recently reported a modest profit of $144 million for the fourth quarter. However, the ongoing decline in first-class mail volume--down 80% since 1997--poses a persistent challenge, with current mail volumes at their lowest since 1968.

As DeJoy prepares to step down after nearly five years in his role, the future of USPS remains uncertain, with stakeholders closely monitoring the outcomes of this new partnership.