Corporate profiteers want to ransack an institution older than America itself.
At a Morgan Stanley conference last week, Elon Musk told attendees the federal government should privatize “as much as possible” – and singled out the U.S. Postal Service as a top target.
Musk’s comments are the latest in an alarming push from Trump’s team to strip-mine America’s oldest and second-most popular agency (USPS narrowly trails the National Parks Service, another victim of Musk’s austerity chainsaw). Trump – who has long feuded with the Postal Service over mail-in balloting – stated in December he was “looking at” privatizing USPS. The Washington Post recently reported on Trump’s plans to end USPS’ independent status and move it to the corporate-captured Commerce Department, where it would be under the direct control of billionaire ex-banker Howard Lutnick.
Though Trump has yet to make anything official, Big Business is already giddy at getting its hands on USPS’ valuable assets. A leaked February 27 paper from Wells Fargo’s equity research team lays out in disturbing detail how Wall Street and corporate couriers could profit from a privatized Postal Service.
Wells Fargo Report is DOGE-esque Roadmap for Looting USPS
The Wells Fargo report, entitled “USPS Privatization: A Framework”, includes many eye-catching tidbits about what privatization could mean for customers, workers, and corporate investors. The biggest takeaways:
- Postage Prices: The report recommends carving out USPS’ parcel delivery operations to either IPO or sell to private competitors like FedEx and UPS. It states that “raising [parcel] prices would be likely” under privatization, by as much as 30 to 140% across parcel products. This would hurt millions of e-commerce sellers and small businesses who rely on USPS’ statutory commitment to affordable pricing, and have similar inflationary effects for consumers.
- Scrapping universal service: Wells Fargo describes USPS’ universal service obligation (USO) – a statutory requirement to provide a minimum level of service at reasonable prices to ALL domestic addresses – as an “restructuring issue” to be addressed. The analysts propose severing USPS’ lucrative parcel business from its less profitable letter mail delivery, selling the former to private investors and potentially leaving taxpayers on the hook for the latter. Without the USO, parcel and package delivery to regions deemed “unprofitable” (such as rural communities) could be scaled back or cease entirely, while public 6-day letter mail service could enter a death spiral.
- Selling off postal real estate: The Wells Fargo report takes note of USPS’ 8,500 properties, which include historic post offices, sorting centers, and vital rural community hubs. It notes ominously that “value can be harvested” by “unlocking” these properties via sale or lease to commercial bidders (who could include real estate developers, corporate landlords, private couriers, or retail monopolists like Amazon).
- Layoffs and Pension Obligations: Citing “recent DOGE efforts on federal cost control”, the report states that USPS’ 600,000-person workforce – 91 percent of whom are unionized – would either receive deferred buyout offers or see mass layoffs as a “required step” of privatization. The authors expect “sizable opposition” to privatization from postal workers, noting USPS’ “union dynamics and collective bargaining agreements”. Another “required step” involves shifting $400B in postal pension and healthcare liabilities to taxpayers (as the UK’s Royal Mail did), or selling off parcel operations and postal real estate to fund workers’ hard-earned retirement benefits. In other words, privatizing the profits and socializing the losses.
- Path to privatization: Wells Fargo floats scrapping the Postal Reorganization Act of 1970 (which turned USPS into an independent agency after the Great Postal Strike) by sneaking PRA repeal into the GOP’s forthcoming budget package. The report concedes that privatization would be unlikely to garner 60 Senate votes, meaning it would have to be attached to “must-pass” legislation to become law.
- “Challenges” to privatization: The report notes that USPS enjoys strong bipartisan support among the public, and that its delivery of election ballots, medicine, taxes, and government distributions and notices (e.g. Social Security checks) would make privatization politically toxic. It also observes the “particularly strong affinity” rural communities have for USPS, and its offering of financial services in unbanked or under-banked areas. Singling out those specific services is a blaring alarm that a privatized USPS would gut them.
- Wall Street’s lobbying helped bring an end to the US Postal Savings System and has helped thwart recent efforts to revive postal banking.
Once Again: Postal Privatization is a Bad Idea
While this report may only be the work of one repeat-offender bank, it does echo the broader views and mission of the pro-privatization crowd (whose most recent evangelists include Hack Watch regulars Jason Calacanis and Matt Yglesias).
Corporations and think tanks like the Cato Institute, Heritage Foundation, and postal contractor Pitney Bowes have lobbied for decades to kill USPS and sell its assets to the private sector. During the first Trump administration, Treasury Secretary Steve Mnuchin led a task force that called for shrinking the Postal Service and stripping its workers of collective bargaining rights. Mnuchin later engineered the appointment of Louis DeJoy as Postmaster General, whose death-by-thousand-cuts austerity plan for the agency has left it even more vulnerable to privatization.
Make no mistake: if these privatization hawks get their way, corporate investors and shareholders will reap a windfall – while everyone else will suffer.
- Postal Privatization Harms Mail Recipients: Postal privatization would likely mean the end of the universal service obligation and 6-day delivery standard, as corporate carriers would seek to profit-maximize by conducting fewer weekly delivery trips or avoiding routes with fewer residents. This could result in millions of mail items and packages arriving late (including time-sensitive tax or legal documents, medication, government benefit checks, and election ballots) – or not at all. Rural, indigenous, and remote communities (where private couriers often rely on USPS for “last-mile delivery”) are particularly at risk of being cut off.
- Postal Privatization Harms Customers & Small Businesses: Steep postage hikes to satisfy corporate investors and shareholders (as the Wells Fargo report recommends) would raise costs on postal retail customers, including millions of small businesses and e-commerce sellers on platforms like eBay, Mercari, and Etsy. Lightweight packages (below 1lb) could see the biggest price hikes under privatization, as USPS’ current Ground Advantage offering is often significantly cheaper than similar offerings from FedEx and UPS.
- Postal Privatization Harms Workers: Privatization would likely mean mass layoffs to USPS’ 600,000-person workforce, which has historically been a road to the middle-class for non-white workers. Pay, working conditions, and benefits could also get worse for postal workers under privatization if USPS’ operations are absorbed by union-busting corporations like Amazon or FedEx. Workers’ pensions could also be at risk, either under the taxpayer-funded scenario outlined by Wells Fargo or by corporations with track records of mismanaging retirement benefits.
- Postal Privatization Harms The Public: A privatized postal service would have no obligation to prioritize or provide public services, like timely delivery of election ballots or infectious disease test-kits. Rural areas could lose more than mail service: rural post offices at risk of sale function as community hubs, while rural carriers often assist in local emergency response and national disasters. There would be few to no mechanisms to hold a privatized postal service accountable to the public, like an Inspector General or board meetings that allow public comment. (The Postal Board of Governors has recently rolled back public comment periods at its quarterly board meetings, now only allowing them once per year.)
These are not theoretical harms. The 2013 privatization of Royal Mail in the UK has already led to steep postage hikes, plummeting on-time delivery rates, job cuts, and chronic mismanagement of worker pensions.
Protect and Expand the Post Office
If they follow through on privatization threats, Musk and Trump will be attacking an American institution older than the country itself and one of the few agencies explicitly authorized by the Constitution. It would be Trump’s own voters who suffer the most under privatization: 57% of United States post offices and 88% of land served by USPS is located in rural America, where Trump won 63% of the vote.
USPS’ bipartisan popularity offers a glimmer of hope that Trump will back off from gutting it. Consider Louis DeJoy’s stealth-privatization agenda for the Postal Service, which has become so unpopular that even Republican members of Congress have grilled the outgoing Postmaster General on mail delays and postage rate hikes hurting their constituents. Any plan that would make these problems worse could be killed by just a few Congressional Republicans – but only if they fear their voters’ wrath more than Musk’s.
This gives Democrats an opening to not just oppose Musk and Trump’s Wall Street-backed scheme to loot the Post Office, but also embrace a forward-thinking vision for a public Postal Service. The People’s Postal Agenda provides exactly this roadmap, envisioning the restoration of postal banking and innovative new services like broadband expansion and local grocery delivery.
This is an existential fight for one of America’s oldest and most treasured public services. Neither Musk nor Trump nor gloom of night should stay Democrats from protecting it.