Friday, March 19, 2010

Déjà vu: The Postal Service’s Economic Troubles

Weekly column by Senator Susan Collins

The United States Postal Service (USPS) recently outlined a ten-year plan intended to address declining mail volume and increase its slumping revenue. In recent years, the USPS has been hit with falling mail volume, the recession, and the loss of customers to digital technology, such as e-mail and online bill paying, that has replaced traditional mail.

During a recent hearing before the Senate Appropriations Subcommittee on Financial Services and General Government, of which I am Ranking Member, Postmaster General John Potter testified that the Postal Service faces a projected $238 billion shortfall during the next decade. And he’s asking Congress to help fix its dire and deteriorating financial condition.

If this sounds familiar, it’s because we have been here before.

I also serve as Ranking Member of the Homeland Security and Governmental Affairs Committee, which has held 14 hearings related to the financial crisis at the Postal Service since 2003.

Nine years ago, the Government Accountability Office (GAO) first placed the Postal Service on its “high-risk list” because it faced formidable financial, operational, and human capital challenges that threatened its long-term viability. As a result of the passage of the postal reform act of 2006, which I authored with Senator Tom Carper (D-DE), the GAO removed the USPS from the list. But last year, the Postal Service, losing billions and facing a crisis, was once again added to the high-risk list.

Approximately every three years – in 2003, 2006, and again last year, the Postal Service has come to Congress seeking relief from its financial obligations in exchange for promises of future profitability. Now, among other things, the Postmaster General is asking Congress to allow it to reduce delivery services from six to five days a week. The USPS also wants to be freed from its obligation to pre-fund retiree health benefits.

In 2003, Congress passed pension reform legislation I coauthored that reduced the Postal Service’s pension costs by approximately $9 billion from fiscal year 2003 to 2005.

In 2006, the Postal Accountability and Enhancement Act that Senator Carper and I sponsored relieved the Postal Service of a $27 billion obligation, primarily by transferring the Postal Service’s obligations for the retirement benefits of its employees with prior military service to the Treasury Department.

In 2009, Congress voted, at the Postal Service’s request, to reduce the Postal Service’s annual retiree health benefits payment that was due on September 30th by $4 billion.

Over and over again, the Postmaster General has promised that if only Congress would allow the USPS relief from its financial obligations and take other actions, it would be on solid financial footing. But time and again, I have been disappointed in the results.

The Postal Service is one of our oldest institutions and is the linchpin of a $900 billion mailing industry that employs close to nine million people in businesses as diverse as paper manufacturing, printing, catalog companies, publishing, and financial services.

This is why I believe the Postal Service needs to focus first on expanding customer services and developing new revenue streams rather than cutting services in order to reduce its red ink.

I will, as I always have, carefully consider the Postmaster General’s latest requests. But the USPS will have to present a compelling case that cutting services, such as reducing delivery to five days a week, will not further decrease volume, drive more customers away, and set off a death spiral.

It will take all members of the postal community, including Postal Service employees and management, members of the mailing community, Congress, and the Administration to contribute to the solution to this financial crisis.

Friday, March 5, 2010

Working with Maine Families to Support Critical Funding for Diabetes Research

Weekly column by Senator Susan Collins

As the founder and co-chair of the Senate Diabetes Caucus, I have learned much about the disease and the difficulties and heartbreak that diabetes causes for so many American families as they await a cure. Diabetes is a life-long condition that affects people of every age, race and nationality. It is the leading cause of kidney failure, blindness in adults, and amputations not related to injury.

According to the Centers for Disease Control and Prevention, 85,000 Mainers were diagnosed with diabetes in 2008, up from 34,000 in 1994. The burden of diabetes is particularly heavy for children and young adults with Type 1, or juvenile diabetes. Juvenile diabetes is the second most common chronic disease affecting children, and it is one that they never outgrow. On average, a child with Type 1 diabetes will have to take over 50,000 insulin shots in a lifetime.

I recently met with several Maine children, and their families, to discuss federal efforts to help those who are afflicted with this devastating illness. Among them was Caroline Sweeney of Gray whose seven-year-old son, Aidan, was diagnosed with Type 1 diabetes just months before his second birthday. Youngsters, like Aidan, whose lives have been forever changed by diabetes, motivate me to continue to devote so much energy to this issue.

It was heart-warming to receive hugs from these children who are so thankful for federal efforts to help find a cure, and we are making progress. Since I founded the Senate Diabetes Caucus in 1997, funding for diabetes research has more than tripled from $319 million to more than a billion dollars last year. That sounds like a lot of money, but consider this-- treating people with diabetes accounts for more than $174 billion of our nation’s annual health care costs. Overall, health care spending for people with diabetes is almost double what it would be if they did not have the disease. If we can find a cure for diabetes, not only do we dramatically improve the lives of children like Aidan and millions of other people, but we also significantly reduce the nation’s overall health care costs. And, as a result of our commitment, we have seen some encouraging breakthroughs in diabetes research, and we are on the threshold of a number of important new discoveries.

This is clearly no time to take our foot off the accelerator. We have two choices, we can sit back and continue to pay the bills and endure the suffering, or we can aggressively pursue a national strategy aimed at curing this terrible disease. That is why I recently joined Senator Byron Dorgan (D-ND) in introducing bipartisan legislation to renew the Special Diabetes Program which expires next year. We need to act now to renew and increase the funding. This program is credited with helping the medical community achieve major advancements, resulting in tangible improvements in the lives of Americans who are living with diabetes. But if this crucial program is not renewed, federal support for Type 1 diabetes research will be cut by 35 percent.

During our meeting, Caroline Sweeney thanked me for my support of the Special Diabetes Program. “Renewing this program provides hope for Aidan and all those living with Type 1 diabetes,” she said. But it is I who wants to thank families, like the Sweeneys, who are so committed to helping me lead the effort to secure critical funding that, one day, will hopefully lead to a cure.


U.S. Senator Susan Collins, a member of the powerful Senate Appropriations Committee, received a commitment from U.S. Transportation Secretary Ray LaHood that his staff will work closely with stakeholders in Maine and New Hampshire to carefully consider supporting an application for grant funding to rehabilitate the historic Memorial Bridge that links Kittery with Portsmouth.

Senator Collins, along with other members of the Maine and New Hampshire Congressional delegations, supported a joint request from Maine and New Hampshire for $70 million in funding from the Transportation Investment Generating Economic Recovery (TIGER) program which would have been used to update this critical bridge. The Department of Transportation received $56.5 billion in grant application requests for a total just $1.5 billion. Unfortunately, the Memorial Bridge project was not funded in the first round of grants announced last month.

Today, during a Senate Appropriations Transportation Subcommittee hearing, Senator Collins explained to Secretary LaHood the importance of this rehabilitation project and urged him to carefully consider supporting the project in an upcoming, second round of TIGER funding.

“These two states collaborated on a TIGER grant application with unanimous support from the Maine and New Hampshire congressional delegations and both governors,” said Senator Collins. “This is a major thoroughfare connecting Maine and New Hampshire. It’s important for commerce, for tourists, and for day-to-day residents, and I urge you to take a close look at this proposal as you consider the second round of grant applications.”

Secretary LaHood responded, “Senator, let me suggest that we work with your staff and get the stakeholders from both states together to review their application in anticipation of us posting up our guidance on the next round. That may be helpful for them and if we could work with your staff to get those people gathered together we could talk about the previous application and the way forward.”

Senator Collins said her office will work with local officials in Maine and New Hampshire to discuss the next steps.

Thursday, March 4, 2010


WASHINGTON, D.C.—U.S. Senator Susan Collins, a member of the powerful Senate Appropriations Committee, today secured a commitment from U.S. Transportation Secretary Ray LaHood to work with her, state, and local officials in an effort to keep the important Maine, Montreal & Atlantic (MMA) Railway operating in Northern Maine. Secretary LaHood pledged to send the Federal Railroad Administrator to Maine to work on a plan to keep the railway operating.

During a Senate Appropriations Transportation Subcommittee hearing, Senator Collins explained to Secretary LaHood how the current owner of MMA recently filed a notice of intent to abandon 233 miles of its track in Aroostook and northern Penobscot Counties, citing high operating costs and low shipping volume as a result of the current economic climate. MMA provides the only freight rail service in Aroostook County, serving primarily the pulp and paper, agricultural and potato processing industries.

Senator Collins expressed serious concerns regarding the proposal to abandon this critical rail link, which would have a devastating impact on the economy of Aroostook County and the State of Maine.

“I am so committed to saving freight rail service to Northern Maine. If the MMA rail line is abandoned, it will be devastating to Maine’s economy, especially given the already steep 9.8 percent unemployment rate in Aroostook County,” Senator Collins said to Secretary LaHood. “Twenty-two shippers directly rely on the rail line. The pulp and paper industry is the primary source of traffic for the MMA. Other major sources of traffic include petroleum, forest products and chemicals.

Senator Collins continued, “All parties involved agree that in order to make this line work, it will take an investment of capital whether from state, federal and private sources. Today, I am asking you to work with me to help identify a solution.”

Secretary LaHood responded, “Senator Collins, thank you for your leadership on this issue. You’ll have my full commitment. Freight rail is very important-- it’s a big component of our transportation system in America. What I’d like to offer is for our Rail Administrator to go to Maine as quickly as possible and meet with all the stakeholders and we’ll figure out some kind of funding opportunity to make sure that this rail line is not closed down. It’s like an interstate- you can’t close down part of an interstate that connects so many different parts of the state. I am committed to helping you. I’ll have our Rail Administrator in Maine and we will work with you on a plan to get this funded.”