
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: FRIDAY, March 23, 1990                   TAG: 9003232713
SECTION: EDITORIAL                    PAGE: A8   EDITION: METRO 
SOURCE: 
DATELINE:                                 LENGTH: Medium

POSTAL SERVICE

THE U.S. Postal Service has asked the Postal Rate Commission for a package of rate increases, the centerpiece a rise in the cost of a letter stamp from the present 25 cents to 30. Along with that 20 percent increase in first-class rates go average increases of 22 percent for newspapers and magazines, 18 percent for advertisers.

The commission has 10 months to consider this. Postmaster General Anthony M. Frank points out that the service is required by law to break even. Costs have risen 19 percent since 1988, and, he notes, the only significant source of revenue is postage.

Frank acknowledges that the package of rate increases would run 6 percent over recent inflation. He promises that in the future, the service will operate below inflation, a goal he says has been met so far this year. The agency has 20,000 fewer employees than it had last May.

That is a commendable reduction, although it leaves the Postal Service with about 750,000 employees, nearly 100,000 more than in 1978. U.S. postal rates are less than those of several other industrial nations, but an operation so huge, so sprawling and so labor-intensive begs for greater efficiency. This is an area where the service still lags.

One recent evidence of that is in the revelation - from the Postal Rate Commission itself - that the Postal Service awarded bonuses to every one of its division general managers in 1988, when postal costs rose twice as fast as inflation. Last year the service made ends meet, and again, all 75 of those managers got bonuses. During the same period, reports the General Accounting Office, the Postal Service was spending from $6.2 million to $10 million on meetings and conferences, some in resort areas of Hawaii, Florida and Arizona.

The general managers run divisions of 5,000 to 24,000 employees, and their annual salaries range from $76,100 to $87,000. Each qualifies for a quarterly bonus of $400 based on performance, chiefly service: Depending on distance, at least 95 percent of mail in that division must be delivered in three days or less. Twelve division managers got no quarterly bonuses last year.

But the annual bonuses, ranging from $3,200 to $11,200, were a sure thing. The maximum possible bonus is $12,000; those awarded in 1988 averaged $5,564, in 1989 $6,173. The managers - who get no longevity or cost-of-living raises - can plan on some bonus no matter how poorly they do. Sen. David Pryor, D-Ark., says the service is "refusing to lead by example at the upper echelons."

Consumer advocate Ralph Nader calls it "part of the official Washington lifestyle, in which officials overpay themselves and their cronies for a job not done." The practice is hardly confined to Washington. But while many businesses seem to exist in order to reward their top managers, greater accountability and efficiency should be demanded from even a quasi-governmental agency. For openers, the commission should sit on the latest request for a few months to see whether Frank's people can really deliver on his promise of below-inflation performance. Some rate increases may be necessary, but unlike those annual bonuses, they should not be automatic.

by CNB