News & Politics

Scam Alert! Press Sleeps Through the Great Post Office Fire Sale

How much of our public domain will turn into private fortunes?

In 1906, surveyor Stephen Puter wrote a tell-all book from prison, Looters of the Public Domain, which details how Puter transferred thousands of acres of prime timberlands in Oregon and Washington from public to private owners. This sort of hustle was common in the 19th century, when much of the public domain was enclosed and converted into private fortunes with congressional help.

History is repeating itself today with the nation's postal service, and much of the press is asleep at the wheel.

The public in 1906 became aware of frauds like Puter's because the U.S. then had a diverse and competitive media environment willing to support gumshoe journalists as well as a president willing to investigate and prosecute criminal activity at the highest level — even U.S. senators of his own party. How times have changed as we now watch the U.S. Postal Service (USPS) looted like prime timberland. A venerable institution that helped build the country is being gutted. This is not, as the mainstream media slothfully claims, because the Internet has rendered it obsolete, but because it represents lumber ripe for the taking while what’s left of the press takes an extended holiday from curiosity.

Last July, the USPS succeeded in uniting a famously fractious town when it announced plans to sell Berkeley’s century-old downtown post office. Berkeley has, ever since, proved a public relations migraine for USPS management. USPS occasionally meets its legal obligation to take public comment on pending sales, and it did so in Berkeley on February 26 at a meeting where USPS representatives endured hours of abuse and outrage from an overflow crowd at the old City Hall. The city council and mayor unanimously condemned the proposed sale. Activists demonstrated at the historic post office, gathered petition signatures, and — in lieu of local press — leafletted town residents about what they were about to lose. 

Perhaps because of that unprecedented resistance, Postmaster General Patrick Donohoe paid Mayor Bates the courtesy of a letter he said would “clarify the facts about the Postal Service’s financial crisis.”

That crisis, Donohoe claimed, has forced him to radically shrink his agency while selling properties paid for by U.S. taxpayers for over a century. Among those properties are architecturally distinguished, landmarked and centrally located post offices like Berkeley’s, many of them containing a gallery of unique New Deal murals and sculpture intended for and belonging to the American people. The handsome buildings marked by flagpoles are often the only federal presence in small towns where they double as community centers — and those public venues are vanishing under Donohoe’s watch.

The Postmaster General insisted that his agency’s nearly $16 billion deficit is not the result of a “manufactured crisis.” He neglected to mention the Republican Party’s stated intention to “modernize” the 238-year-old agency by privatizing it. Nor did he cite the pro-privatization white papers churned out by right-wing and libertarian think tanks like Cato and American Enterprise, or the political contributions lavished on congressional representatives by private carriers lusting for the USPS profit centers, or that some of those representatives and their spouses would like to “reform” the USPS right out of existence.

Absent, too, was any mention of the ruinous Postal Accountability and Enhancement Act passed by Congress in 2006 that requires the USPS, within 10 years, to fully fund its retiree health benefit fund 75 years into the future while simultaneously barring it from offering services that would compete with the private sector. Donohoe instead fell back on the “Internet-made-us-do-it” meme so often parroted by the U.S. press when it bestirs itself to report on the postal crisis at all. He explained that in order to put the USPS back onto a sound financial footing, he had slashed the size of its workforce by 193,000 employees through attrition, pared some 21,000 delivery routes, and reduced operating expenses by $15 billion. Despite all this and his recent effort to eliminate Saturday delivery, he clamed that the leaner and meaner USPS had “provided increased access to postal products and services.” Tell that to postal customers and workers these days.

The Postmaster General concluded his letter by insisting that “the Postal Service is the first to acknowledge how important it is to preserve our historic buildings, which,” he said, “is why we are going through a lengthy and transparent process to assure their protection before they are sold.” That lengthy and transparent process includes a minimum15-day comment period following a public meeting that it might hold. Those two weeks give citizens faced with the loss of their post office an opportunity to vent in writing to a USPS which displays all of the transparency of Kafka’s Castle.

Without addressing any of the city’s concerns, the agency responded to Berkeley’s storm of opposition a week after the mayor received Donohoe’s letter with a tart Notice of Approval to proceed with the sale.

The announcement came as little surprise to those who follow the website savethepostoffice.com, for Berkeley’s experience repeats that of dozens of other communities around the U.S from Ukiah, California to the Bronx. Postal customers find their wishes ignored and their historic downtown post offices locked and thrown onto the market. Soon thereafter, the once-public buildings if not demolished are converted to condominiums, real estate offices and restaurants while the services they provided “relocate” to cheesy leased spaces often less accessible to customers. The art they hold falls into limbo or itself becomes inaccessible.  

One doesn’t need an MBA to understand that selling a tax-exempt building one owns to lease space one doesn’t is not a good long-range business model —  unless one is the real estate broker that has scored an exclusive contract to sell the public’s property and advise on what to sell. That makes a very good business model indeed.

Although the USPS has a nation-spanning real estate portfolio estimated to be worth as much as $110 billion, the press has, with few exceptions, taken little interest in how it is being flogged and by whom. The USPS gave that remarkably favorable contract to the giant commercial real estate firm CBRE in 2011. That CBRE is chaired and largely owned by the private equity billionaire Richard C. Blum has likewise failed to elicit much curiosity from the press; that Blum is married to one of the most powerful U.S. senators, Dianne Feinstein, even less so.  

Where such august institutions as the New York Times and Feinstein’s hometown newspaper, the San Francisco Chronicle, would not go the La Jolla Light went. The Light has given extensive coverage to the pending sale of that town’s downtown post office with its exquisite mural of the coastal landscape. In one article reporter Pat Sherman linked La Jolla’s resistance to Berkeley's, where Blum is well known as the Alpha Regent restructuring the University of California. Sherman furthermore broached allegations of Senator Feinstein’s conflicts of interest past and present. Her office responded with its boilerplate disclaimer that “Senator Feinstein is not involved with and does not discuss any of her husband’s business discussions with him.” Ignoring California’s community property laws, the senator’s office told the Light that “Her husband’s holdings are his separate personal property.” That has satisfied most press outlets.

Despite the failure of the U.S. press to report on or investigate the fire sale of historic post offices and the uncertain fate of the art they contain, resistance is nonetheless growing. Angry customers from Redlands to Chelsea in New York City have been confronting postal representatives. One activist group in Berkeley continues to fight the sale of that town’s post office, while another — the National Post Office Collaborate — has been forging an alliance with other affected communities while engaging the legal firm of Ford & Huff to appeal individual sales and explore further legal actions. The California Legislature has passed a measure urging the USPS to rescind the sale of the Berkeley post office and is considering further action since the Golden State has been disproportionately hit with post office closures and sales.

The dismantling of the nation’s postal service and the sale of the public’s property is yet another facet of Grover Norquist’s famous pledge to so shrink the federal government that he can drown it. Norquist has also expressed his admiration for another Gilded Age when men such as Stephen Puter transferred the public domain into private fortunes. Senator Jennings Randolph once remarked that “When the post office is closed, the flag comes down. When the human side of government closes its doors, we’re all in trouble.” 

That is just the kind of trouble Norquist and his congressional marionettes want. That we are getting it has as much to say about the dereliction of the U.S. press as it does about what Postmaster General Dohohoe is doing to liquidate the agency he commands.