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Blog Post | August 15, 2021

To Ditch DeJoy, Biden Must Replace Ron Bloom

2020 Election/TransitionExecutive BranchIndependent AgenciesUSPS
To Ditch DeJoy, Biden Must Replace Ron Bloom

Why does a Postmaster General who doesn’t even know the price of a postage stamp still have his job?

This question continues to frustrate members of Congress, watchdog groups, and countless everyday Americans despite its relatively simple answer: the Postal Board of Governors. Over the last year, the board’s Republican members (many of whom have close political and business ties with Trump and the Republican Party) have held a majority and protected Postmaster General Louis DeJoy from any attempts to fire him. But with the Senate confirmation of Biden’s three nominees to the board last month, DeJoy’s GOP allies no longer hold a majority on the board.

So why do experts still believe that DeJoy won’t be losing his job anytime soon?

The answer, frustratingly, is the same: the Postal Board of Governors. Despite Democrats gaining a nominal majority on the board in May, the board’s two Trump-era Democratic appointees have continued to side with Republicans on everything from DeJoy’s 10-year “reform” plan for the agency to the question of whether he should remain in office. The more vocal of these two DeJoy-supporting Democrats, Ron Bloom, is an asset management executive who was elected Chairman of the Postal Board this past February. Currently serving a holdover term on the board, Bloom has praised DeJoy as “the proper man for the job” as recently as April and boasted that his fingerprints are “all over” DeJoy’s widely-panned 10-year plan. With Bloom’s continued presence on the board, DeJoy will likely be able to follow through on his threat that Democrats should “get used to [him]” as the Postmaster General. 

Fortunately, Biden is not without options when it comes to saving the Postal Service from Trump’s lackeys. He can and must begin by replacing Ron Bloom. 

Who is Ron Bloom?

Prior to becoming DeJoy’s right-hand man, Bloom developed a reputation as a revolving-door consultant in corporate restructuring transactions. After working at investment banking giant Lazard for nearly two decades, he joined the Obama administration in 2009 as a Senior Advisor to Treasury Secretary Tim Geithner, helping shepherd the effort to rebuild the auto industry during the Great Recession. Upon leaving the Obama administration in 2011, Bloom revolved back to Lazard as its Vice Chairman of Investment Banking. Among his notable clients during his second Lazard stint was the National Association of Letter Carriers (NALC), a major postal union that hired Bloom to explore solutions to USPS’s solvency issues. Although celebrated by NALC as a “reality check” for broadly opposing service cuts and encouraging expansion of services, the final report issued by Bloom’s Lazard group also left the door open to “greater flexibility to pricing of products” (read: unpopular price hikes) and private-sector contract partnerships in logistics and freight forwarding services (which postal unions have long opposed as a form of privatization). Absent from Bloom’s final report was an explicit call for Congress to repeal the onerous retiree health benefit pre-funding requirements in the 2006 Postal Accountability and Enhancement Act, which many postal experts (including Bloom’s Lazard team!) attribute as a major cause of the Postal Service’s current financial woes.

In 2016, he again left Lazard to join controversial private equity firm Brookfield Asset Management as a Vice Chairman. Brookfield made headlines in 2018 for allegedly using Qatari financing to lease a Manhattan skyscraper from the Kushner family while Jared Kushner was serving as a senior White House advisor. Last December, Democratic Senator Ron Wyden and Congressman Joaquin Castro opened a formal probe into Brookfield’s dealings with Kushner Companies and Qatar, focusing on whether its Qatari-financed bailout of Kushner’s 666 Fifth Avenue was linked to Trump’s withdrawal of support for the Saudi-led blockade of Qatar.

Since being appointed by Trump to the Postal Board in 2019, Bloom has served as a reliable vote for both DeJoy and his agenda. Amidst the national outcry against DeJoy’s dismantling of mail-sorting machines last year, Bloom did not respond to press inquiries about his thoughts on DeJoy’s leadership. The subsequent chaos caused by DeJoy’s operational changes prompted New Jersey Congressman Bill Pascrell to call for the immediate firing of Bloom and the rest of the Board for their “silence and complicity in [a] deliberate campaign to subvert vote-by-mail elections and destroy the Post Office.” When asked by The Atlantic earlier this year about whether DeJoy’s operational changes had affected the election, Bloom offered a jaw-dropping response that such claims were “absolute BS”  and called the agency’s handling of 2020 mail-in ballots “awesome and amazing”. Bloom’s claims fly in the face of data released by his own agency, which showed that absentee ballot mail delays arising from USPS operational changes were the worst in key battleground states like Michigan and North Carolina. Despite continued public outrage over DeJoy’s leadership, Bloom has asserted that DeJoy will “have my support until he doesn’t, and I have no particular reason to believe he will lose it.” 

Bloom has also proudly proclaimed his support for DeJoy’s 10-year USPS restructuring plan — which would reduce service hours, extend delivery times, eliminate extra delivery trips, and raise postage rates — by coauthoring its introduction, pitching it to key stakeholders, and defending it alongside DeJoy himself in press interviews. He has reportedly also had a quiet but crucial role crafting the plan, with several Congressional Democrats noting some similarities to his 2012 NALC-Lazard report. In urging Democrats to work with DeJoy rather than push to fire him, Bloom finds himself allied with his onetime colleagues at NALC leadership, who have similarly tempered calls to oust DeJoy despite strong opposition from rank-and-file union membership. 

As he remains in DeJoy’s corner, Bloom has drawn scrutiny for his financial ties to the Postmaster General. In August 2021, The Washington Post reported that DeJoy had purchased up to $305,000 in bonds from Brookfield Asset Management, leading many observers to deem Bloom’s continued service as Postal Board Chairman a “gross breach of government ethics”.

What Can Biden Do?

Fortunately for Biden, Bloom is in a fairly vulnerable position. He has been serving a one-year holdover term on the board since last December and — unlike the other Governors on the Board — can be replaced at any given moment due to his “normal” term having already expired. While Bloom himself has told the Atlantic that he hopes Biden re-nominates him to another term on the Board (a request that he must be denied), Biden is under absolutely no obligation to do so. The unique conditions of Bloom’s Board membership would therefore allow Biden to sidestep the potentially dicey legal consequences of firing the entire Board for negligence, as Rep. Pascrell has suggested, while also removing one of DeJoy’s key protectors from power. 

While immediately firing and replacing Bloom would be a positive step in the right direction, it alone would only give the board’s anti-DeJoy wing a 4-seat minority. Biden again has some good news here, as Republican Governor John Barger’s term is set to expire in December of this year. Alongside Bloom’s replacement, Biden can and should nominate another progressive Democrat or Independent to take Barger’s soon-to-be-open seat and ensure that the board has an anti-DeJoy majority by 2022. Replacing Barger alongside Bloom will also neuter the power of the board’s other pro-DeJoy Democrat, Donald Moak, whose term only expires in December 2022. 

With executive branch nominations quickly piling up in a Senate backlog, the sooner that Biden makes these two nominations, the better. 

There’s Never Been A Better Time To Fire DeJoy

Contrary to what NALC’s leadership believes, there has never been a better time to oust one of the most reviled and unpopular figures in the federal government. As of September 2020, a majority of voters supported removing DeJoy from office — a figure that has almost certainly increased since the chaotic election and holiday mailing season. DeJoy has also done little to win back the public’s trust, predicting that widespread mail delays will be “the new normal” for 2021 and championing a 10-year strategic plan that has received negative reviews from not only Congressional Democrats, but small business-owners and postal unions as well. Just this past month, DeJoy’s reputation took another massive hit after the FBI began investigating claims he operated an illegal straw donor scheme while running his private delivery company New Breed Logistics. DeJoy’s laughable response to the investigation — that he had not “knowingly” violated campaign finance law — has permanently erased any doubt among the public that DeJoy views himself as above the law. 

And all of this bad news for DeJoy comes as Congress considers the most sweeping legislative effort to reform the Postal Service since 2006, when lawmakers imposed a sabotaging requirement that the agency pre-fund its employees’ health and pension benefits decades ahead of their retirement. This latest bite at the legislative apple comes from House Oversight chair Carolyn Maloney, who — despite having expressed a willingness to work with DeJoy on reform legislation in the past — faces continued pressure from both postal unions and progressive primary challenger Rana Abdelhamid to fight back against DeJoy. There is already strong evidence that this union-led pressure campaign is working, as a harsh letter from the American Postal Workers Union (APWU) resulted in Maloney yanking a controversial DeJoy-friendly waiver provision from her draft postal reform bill last month. 

With DeJoy’s public standing on the decline and progressives holding greater leverage over postal reform legislation, those opposed to the Postmaster General’s disastrous leadership must strike while the iron is hot. The 2022 midterm elections are already on the horizon and the prospect of a GOP-controlled Senate remains historically likely, meaning that the window of opportunity for personnel changes at USPS is rapidly closing. If DeJoy’s stranglehold over the Postal Service is not broken soon, he will be granted free rein to continue widespread service delays and carry out his smash-and-grab plan for the agency — an unacceptable outcome for the millions of Americans who rely daily on the Postal Service. 

Biden must not allow this to happen. If he rests on his laurels and assumes that his three previous nominees will be enough to counter DeJoy, he will be complicit in letting a Trump crony hasten the decline of one of America’s most beloved public institutions. A failure to act by Biden would also break his own pledge to ensure USPS “is running at the highest of service standards and […] can effectively and efficiently serve all communities in our country.” Conversely, if Biden acts quickly to replace Bloom and Barger and secure an anti-DeJoy majority on the Postal Board, he will be rewarded by the millions of midterm voters who are sick and tired of their bills, medications, presents, and other mail being stranded at USPS sorting centers. It’s a win-win for both Biden and the American people.

The path forward is clear: to ditch DeJoy, he must boot Bloom and build a better Board.

This blog was originally published in June 2021. It has been updated to include reporting on Louis DeJoy and Brookfield Asset Management that was published by the Washington Post in August 2021.

PHOTO: “Ron Bloom by David Shankbone 2010” by david_shankbone is licensed under CC BY 2.0

2020 Election/TransitionExecutive BranchIndependent AgenciesUSPS

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