Wells Fargo Is Plotting to Privatize the Post Office

Wells Fargo envisions a postal service where the mail is kept as a taxpayer-funded government entity while the package and parcel components, which are more profitable, are “sold or IPOed.” In order for the new private company to earn a decent profit, “USPS would need to raise prices by ~30-140% across its product line.”

A privatized postal system would also take aim at the Universal Service Obligation, which requires mail to be delivered to every address six days a week. Such dedication to equitable service “would be a challenge for a third-party operator to profitably move mail and packages,” the memo complains. This move would also put pressure on the proposed mail-only service, which would likely be financially hobbled, to downgrade from six-day delivery as well.

DOGE’s assault on federal workers has seemingly given Wells Fargo inspiration. Citing “recent DOGE efforts on federal cost control,” it recommends that postal employees be given a “deferred buyout offer to leave or layoffs could ensue.”  Taking a page from the UK’s Royal Mail privatization in 2013, it suggests that the government take over all pension liabilities and not offer them to workers at the new private company.

With surprising candor, the memo admits that privatization will cause “less job security amid inevitable loss of union protections, loss of pension benefits, higher healthcare costs and employee/wage restructuring.”

With post offices in every zip code, it’s not surprising that Wells Fargo is also looking at real estate as a major source of profit. The company estimates the real estate value for the USPS to be as much as $88 billion. This includes “smaller post office facilities” Wells Fargo would love to sell off or lease. These post offices serve as critical pieces of public infrastructure, especially in small towns and rural areas.

The authors of this memo are aware that USPS privatization will not be an easy task. They’re forced to acknowledge that “public, private, labor, and federal support of the USPS remains high” because it “provides critical services to many communities.” Additionally, rural customers have a “particularly strong affinity.” This speaks to the reality that the USPS does much more than just deliver mail; people rely on it for election ballots, medicine, financial services, and more.

Due to the broad public affection for the USPS and the unlikelihood of bipartisan support for privatization, the memo recommends a backdoor strategy of getting it done through a budget reconciliation bill. The authors also raise the possibility that Trump could replace the Postal Board of Governors with people who will implement policies “which could effectively work to accomplish some of what could be done through privatization,” such as rate increases.

Wells Fargo is smart enough to know that the main bulwarks of opposition to privatization are the major postal unions. Referencing the Great Postal Strike of 1970, the memo’s authors fear the prospect of “employees jointly striking and causing material damage” to the economy as a whole.

They’re right to be worried about the consequences of organized opposition from postal workers. Nor is the notion far-fetched: there are currently rumblings among the rank and file that could link postal workers’ militancy to a broader fight against privatization. As Labor Notes has reported, a new caucus in the National Association of Letter Carriers (NALC) called Build a Fighting NALC led a movement to overwhelmingly vote down the latest tentative agreement from USPS (which offered a measly 1.3 percent annual raise). They also pushed the national union to endorse their national day of action on March 23.

Wells Fargo is right about one thing: with postal workers in motion, a privatization ploy won’t go down without a fight. As the memo begrudgingly admits, the USPS enjoys majority support from the American public that allies can build on to defend against these attacks. It has been a critical source of stable unionized employment, especially for African Americans and veterans.

Instead of privatization, the postal service should be expanded to perform services like postal banking, copying documents, wrapping holiday presents, and more. Financial institutions like Wells Fargo want to turn an essential public service into another moneymaking machine and destroy unionized workers in the process.

If the Wells Fargo memo is any indication, the silver lining is that they know we have the power to stop them.