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By Suzanne Blake
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The United States Postal Service has hiked stamp prices, and Americans aren't happy about it.
The price increases arrived after Postmaster General Louis DeJoy said he stepped into a "broken business model" once he started working at the agency in the middle of 2020, he said at the National Postal Forum this week.
The agency was soon to run out of money, and the price upticks came as the postal service looked to remain financially viable.
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"Failure to adequately adapt to social, economic, technological, and industrial changes have destroyed giants in their industry—Kodak, Motorola, Blockbuster—in just a few short years," DeJoy said in a keynote speech.
"The demands of the changes experienced by the Postal Service were magnitudes greater. In addition, these organizations did not have a Congress or a regulator to contend with."
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"The future we seek has simple goals: Evolve, serve, and create long-term viability. However, this undertaking is of historic proportion," he added.
Beginning in July, the USPS will up prices once again, marking the sixth price hike since 2020. In 2020, the Postal Regulatory Commission agreed to allow the USPS to raise prices higher than the rate of inflation.
Read more: What Is Inflation? Current Inflation Rate, Causes and How to Stay Ahead of Rising Costs
Those price changes go into effect July 14 and will see the first class stamp go from 68 to 73 cents. That's a 31 percent uptick since DeJoy took office.
Ahead of the change, a flurry of backlash has hit the federal agency.
"This week, I wrote a letter to the Postmaster General urging him to reconsider the recently proposed stamp price increase," New York Representative Ritchie Torres wrote on social media platform X. "We must ensure that the USPS remains affordable to the lowest-income families who live on a fixed income and those who lack access to the Internet."
Former presidential candidate and consumer advocate Ralph Nader echoed these concerns on the platform.
"Next month, the First Class postage stamp takes a huge leap from 68 cents to 73 cents and it takes longer than ever to deliver a First Class letter thanks to Trump supporter/Republican Postmaster General Louis DeJoy," Nader wrote.
"Letter writers are seeing routine delays of 5 days or longer around the U.S. DeJoy cut service and raises rates, while the Democrats—now in control of the Postal Board of Governors—refuse to fire him. That's why people see the Democrats as weak. DeJoy is bringing misery to people who use the postal service."
The agency has also looked to make its mail process more efficient, with larger trucks running delivery instead of having smaller ones on the road.
Still, the agency has to cease some of its plans until January or later after the Senate told the USPS to get a handle on its mail delays in several regions.
Ultimately, the USPS plans to implement $40 billion in upgrades, including adding an electric fleet. All of these initiatives cost money, and much of it is felt by the everyday American.
"Our efforts do not come without uncomfortable consequences, to our customers, to the American people, and to our employees. But they must be made," DeJoy said. "We are doing the necessary and important work for the nation, to develop a new path forward."
Currently, the USPS delivers 44 percent of mail worldwide. However, its numbers have been dwindling in recent years due to the rise of e-commerce giants like Amazon.
"It's a price increase that many may not like, but they can understand. The Postal Service has struggled over the years to be financially viable, with some years racking up billions of dollars in losses," Alex Beene, a financial literacy instructor at the University of Tennessee at Martin, told Newsweek.
"Price increases like this one unfortunately have a trickle-down effect. A 5-cent increase from 68 cents to 73 cents may not feel substantial when you're paying for an individual letter or package to be shipped, but it can have a larger impact on many products shipped to stores, as we've seen with price increases carried out by FedEx and UPS, as well. It's nice to see the Postal Service attempting to be more fiscally sound. It's just sad it comes at the price of more burden on their customers' wallets."
The agency saw a 40 percent loss of mail volume industry-wide after the 2008 Recession, and volume never recovered to its prior levels.
"We are an organization that no longer has a sustainable monopoly," DeJoy said. "We are an organization that now has a costly public service obligation and lacks a funding source adequate to cover the cost, in the manner that we serve."
Over 14 years after 2008, the USPS lost $90 billion and was in a state of disarray during the pandemic, according to DeJoy.
"We avoided making big decisions, and we developed a strategy of simply getting through the day," he said.
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