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CNN Live At Daybreak

Anthrax in America: Next Victim: Postal Service?

Aired October 31, 2001 - 07:54   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
PAULA ZAHN, CNN ANCHOR: It is hard to imagine the mail becoming a weapons delivery system, yet that is exactly what has happened to the U.S. Postal Service with those anthrax-tainted letters. Mail volume and revenue are both down sharply since the start of the anthrax attacks.

Postmaster General John Potter told Congress just yesterday the Postal Service will need several billion dollars in aid to recover from the crisis.

And as Hillary Lane reports, some wonder whether the post office can even survive.

(BEGIN VIDEOTAPE)

HILLARY LANE, CNN CORRESPONDENT (voice-over): From door to door, street to street, state to state, there is timelessness to the mailman. The country has had a postal service in some form since 1672. Today, the quasi-government agency employs nearly 900,000 workers, delivering 680 million pieces of mail a day.

It's an inflexible giant, lumbering along in a far more nimble world. Snail mail, unable to compete with the fax machine, e-mail, or even in the package business -- the younger upstarts, such as Federal Express and UPS, now deliver the vast majority of packages, especially for businesses.

GENE DEL POLITO, ASSOCIATION FOR POSTAL COMMERCE: They can go in there and negotiate very, very favorable rates, much more favorable than the Postal Service is able to offer them.

LANE: The anthrax scare has made matters even worse. Unions representing postal employees are now suing to close mail sorting facilities where anthrax fears have driven up worker absenteeism, adding to concerns about the safety of the mail.

(on camera): The Postal Service gets just 1 percent of its budget from the U.S. Treasury. Its revenues come from stamp sales and other mailing services. But adding a few pennies to the price of delivery isn't enough to pay off the Service's $11 billion in debt.

(voice-over): And the bleeding continues. Losses in the most recent fiscal year: an estimated $1.5 billion. Since September 11, the Service has lost $150 million a week. First, planes were grounded, then came a slowdown in volume and an increase in security.

A bill in the U.S. House proposes extensive changes to the postal system, giving it more independence in pricing and contracting out services. In the words of one postal commissioner, everything's on the table.

GEORGE OMAS, POSTAL RATE COMMISSIONER: I said to Sen. Thompson that I thought that maybe some consideration should be given to let the Postal Service do what they do best, and that's through the last mile -- the delivery -- and that maybe the processing and things that they can't get a grip on should be something that they should contract out.

LANE: Surviving as a smaller, swifter service behind the scenes, but maintaining the familiar face out front.

Hillary Lane for CNN, New York.

(END VIDEOTAPE)

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