understand the vital importance of a healthy postal service. you know, we've spent a lot of time and these guys have done a lot of good work. if you see the work that's been done already from the administration and with senator call and senate lieberman, they've gotten a lot of things done over in the house side with congressman issa, ross, cummings and lynch, they've done a lot. so, there's a lot of interest. it's just a matter of trying to get what's out there right now thought through and pushed so we get, a, something done quickly, and we're able to quickly go forward. >> one questioner says "what is the intent of the issa/ross bill, if, as you say, it wouldn't actually save the postal service?" >> well, you know, again, i think it's, from their perspective, it's the best way to approach the issue. you know, there's a couple things there. they do allow us to quickly move into a six-day -- from a six-day to a five-day environment. they are saying give us the overpayment back from the first

system. however, there are constraints that i see. we'd have more government oversight with network changes, post offices. i think we can do these things quicker if we just act on them now. within the bill, the issa bill also has a control board which would almost step in, like washington, d.c., and take over the roam of tle of the postal s and our governors. if we get to that point, we've failed. what we're saying is give us the freedom to act like a business now and we will make sure that we get a much stronger postal service going forward right now. we don't really need another body to be telling us what to do. >> last night, you announced the postal service was extending contract negotiations with your two unions. the questioner asks, "are you on your way to arbitration and a deal that favors unions?" >> here's the thing, as i mentioned earlier, our employees do a tremendous job. they provide great service. when you see the reductions

we've done from a cost standpoint and the productivity improvements that our people have shown, they do a great job. we have an excellent working relationship with our unions. we have four unions, three management associations. they understand the issues that are facing the postal service. so, when we got to the point last night where we needed an extension, i think it's well worth sitting down to continue to talk. i mean there may be a solution in there. from a postal service standpoint, we're looking to resolve this health care issue, and at the same time, more flexibility with our labor. >> okay. what happens if you don't reach an agreement? >> well, then we go to arbitration, but let's -- i'm a glass is much more than half full person, so i'm hoping we can get something worked out. >> questioner says, "the november 18th deadline for you to make a $5.5 billion retiree health payment has come and gone. did you default, and if so, what's the consequence?" >> we didn't default, and what's happened is, in the continuing resolution, the postal service has been exempted from making

that payment now until i think the 18th of december. our proposals on health care would basically eliminate the need to prefund. we've laid out a game plan, taking the plans over ourselves, working with the unions as a potential provider in there as we work through that. we can eliminate substantial requirements now that exist on this organization to require the prepayment. this prepayment is the sort of dam klees above the head of the entire industry that needs to get resolved. >> so, does that change and infer a denim yunsion of benefits that it covers. >> i don't think so. there are people in this room that i've spoken to, two big companies who have recently renegotiated their own health care plans with big providers. it's not like we'd be out getting health care from somebody on the street corner. you know, there are big providers, and these guys have told me, hey, want to reduce health care costs by 13%, the other by 12%. this year, the post office will

pay $7.2 billion in health care without the prefunding. without the prefunding. so, if we're able to strike a deal with a health care providers to take a 10% cost reduction, that's $720 million forever. that gives you big opportunities to cut costs going forward. and the same thing -- you know, one of the other pushes we've had with the health care has been working with our retirees to move them on to medicare. the way it's set up now, we are paying -- we're overpaying for retiree health benefits for our retirees since they're not required to go on medicare. we think we can get a better deal for them, better cost coverage and better health care with the proposals we're going for. >> here's a question that came over the electronic transom, said to be from a postal employee near lansing, michigan. this is the question, "how do you plan to ratify two contracts currently in negotiations, when" in this person's view," you haven't honored the apwu

contract you just signed?" >> we've done a lot of work with the apwu from the standpoint of implementing the changes. i think we have honored it. we continue to honor any of the contracts that we sign with our employees. you know, we want to -- we have to work to get more flexibility. we achieved that to a large extent with the apwu. that's what we're implementing now. >> okay, the person asks "are you making any changes in your position on post office closings? senator collins said you endorsed the language that would create a new post office standard." >> here's what we're looking at. there's -- the one thing that we don't want to do is close up a post office and walk away. many of these towns, and it depends where you're at in the united states. the farther out west you get, they're a lot farther apart. what we're looking at is, between a consolidation to a nearby post office, providing additional rural service -- our rural carriers today can actually, they're a post office on wheels and we can provide that service. matching up the hours with the

actual workload. many cases, we're open for eight hours when we have less than two hours work, less than one hour's work in some cases. a number of those as well as -- >> sounds like a good job to have. >> no, it would be boring. think how boring it would be, seriously. >> speaker, please -- >> oh, i'm sorry. at any rate, we have those opportunities, plus we're looking at things like the village post office where you can team up with a local store and provide service. that keeps the store open, gives us the ability to provide that service. >> the questioner asks "do you still have only one week's worth of operating cash?" >> i'll have to ask the cfo. he's here. here's where we are on the cash. right now, we had a ruling that came out that says we're going to have to pay back the frs money that we set aside. we're doing that. we still will have a couple weeks of operating cash. that's why it's so important to get this bill resolved, because like any other business, we'd like to get the operating cash and pay the debt down so we're

much stronger going out into the future. >> another e-mail -- "has the postal service studied international models? i know canada and new zealand have intriguing postal systems. does the postal service feel it can use another country's model to fix its current situation?" >> i spoke, as a matter of fact, i was in canada on friday and spoke with a couple people from different posts around the world. there are different models, pbu a lot of it comes back to a public expectation, and b, what you do. we have almost 50% of the world's mail because we have a very different postal service. you know, you've got bills come through the mail, payments come through the mail, magazines, catalogues. many of these other posts are a much lighter volume post. they also charge a heck of a lot more. now, germany charges 75 cents a letter. how about if we just move the price up to 75 cents and everybody would be happy? i don't think so. but you know, so those are some of the suggestions we get in. we think from a business model

perspective, looking forward, first class mail is going to drop off. we know that. we're preparing. that's why we need to make some changes. but we think from an advertising standpoint, we think from a package delivery standpoint, and we think that there is definitely an opportunity for us in the digital world and we want to go in that direction. >> so, along those lines, somebody asks, besides the five-day week delivery schedule, what other best practices can you adopt? i mean, sort of a variation on the same question. >> well, you know, we adopt things based on what we see that are industry bests. we are very much tied into both fedex and u.p.s. from a standpoint of delivering their packages, and you know, we use them for transportation purposes, too. and we've learned a lot from them as far as visibility and customer expectations that way. we've learned a lot from retailers around how to best serve customers, looking at different options on self-service and some of those. so, from a standpoint of best

practices, we're open to anyone, any business in the u.s. tot to the same thing with >> what do you do with respect to measuring customer satisfaction and where are you with that? >> we have a saying,were measur everything. we measure point-to-point service, whether it's blue mail, box mail. we measure right now all of the commercial mail that comes through. we probably on a monthly basis have a delivery score for about 8 billion pieces of mail. so, we measure that against time and service. we also run mystery shopper programs and we've got customer experience measurement. we're constantly looking at what the customer's saying in order to try to improve our performance. >> so, how are you doing, generally speaking? >> well, our overnight mail service right now is about 96.5% on time, two and three days is in the mid-90s from a customer satisfaction standpoint. we only measure on very satisfied or mostly satisfied.

we don't even like to deal with satisfied. and we're up in the high 80s on those scores. the goal is to get up to 100%. >> how about the treatment at the counter? all of us have had different experiences with that over time. some people are better than others. how do you work on that kind of a situation? >> that's -- you have to work on that every day, because if you make changes, what happens is, with the work hour changes, work hour reductions you make, you constantly have to work with the employees to talk about how good that it is for good customer service. do we have spots where we have to do more work? absolutely. and we have a lot of great people out there that providy. >> someone asks, "how many post offices have you closed, or any, under the latest closing initiative, and how many processing plants? and is there a delay in that process of closing?" >> in the last year, we've closed about 500 post offices. that was in the first run-through, this 3,700 we're looking at now, we're still in the evaluation process. we closed about 50 processing

facilities over the course of the last year and a half, and we'll continue to do that. i mean, it's -- as the volume has dropped, we have to make these changes. you just can't wait until the bitter end and then try to close. we've got to take the costs out now. >> and is there an appeals process where a community says, hey, we're special? >> yes, yes. >> how does that work? >> here's what happens. if you close a post office, you have to have a public meeting and you explain why you want to do that. one of the things we've learned going through this is it's better to go in and give people some options. i think that that's an area where we haven't done as well going in. it's not been -- we haven't articulated the options. so, we'll go in, a town has the opportunity to come back to us with an objection or to the regulatory commission. they're doing that. we're trying to work through those things now. the same with the processing facility. we have what's called an area mail processing process, where it's the same kind of public hearing, and we go through that process, too. and you know, the key thing for

us is as we shrink this network down, the most important thing for people to know from a customer's perspective is we do not want to make it any more difficult to get mail into our system. we want to make it easy, so we'll retain locations where we're closing a facility so that people don't have to go out of their way. in fact, for a lot of the small businesses, we want to have the mail come through the front door rather than through the back door to even make it easier for people. so, as we make these changes, we'll use technology to make it a much better, friendlier process for the customers. >> so, can the political process get involved here when you're asking congress, obviously, to give you legislation to make your operations fiscally sustainable? what kind of involvement politically do members of congress have on this decision-making process as it relates to closing post offices? >> well, you know, you get opinions from many different people. some people -- and it's interesting. i mean, there's 535 members of congress, and i think if you gave them a list of ten issues

with us, you would have 535 different scores at the end of that. there are some congress, members of congress that, don't close the post office for any reason. there are some that are pushing close. there are some that want us to move six to five. a lot of it is our responsibility to educate and put options in front of people. the more we can communicate and make sure people understand, a, where we're trying to get to, and b, how we're going to get there, i think we'll be able to move both the public and congress in that direction. six to five-day, hey, you know, 80% of americans are now saying move from six to five-day do not become a burden on the american taxpayers. we do not want to become a burden on the american taxpayers. >> back he the questioner says "there is a lot of animosity between management and unions. do you have any hopes or plans toa" >> well, i think that -- i don't think that there is that much animosity between management and -- you're going to have that

down through an organization at any point in time. you can find that in the auto industry, the steel industry, anywhere else you've got a unionized workforce. i think our four union leaders are very responsible people. the three heads of our management associations are very responsible people. they have their opinions on things. i like to be able to listen. i also respect those opinions and i also know that they've listened to a lot of our suggestions. i think, bottom line, bottom line, both with the unions and the other stakeholders in this industry is we've got to coalesce, we have to give some things up, in some cases. but any time you're going to come up with a good win-win-win situation, everybody's got to be able to give a little bit. >> so, a knowledgeable person in our audience says 80% of americans may want six to five-day delivery, but senator collins isn't among them. how are you going to work around that? >> well, just like anything else, you constantly work at it. and we've talked to senator collins on this. her biggest concern is, what about rural america? what about people not being able

to get medicines on the weekend? that's her issue. and we've talked through, is there some potential other changes in there? do you go with, you know, to five, or holidays and have a saturday delivery there? that's been a proposal. bottom line is, there's two things that are happening -- we've lost 24% of the mail, we're losing another 20%, and the shift from first class, which pays the bills, is relentless. and we've got to get our finances in good order. so, we'll keep working with senator collins and everyone else to work through these issues. >> speaking of giving politically correct answers, here's one that says, "assess your regulator. do they do a good job of helping the postal service remain financially solvent?" >> i think we have an excellent relationship with our regulator. i do. and ruth is here, and i think she would tell us that. i mean, we try to reach out and communicate. we have spent a lot of time over the last few years, whether it's price and product and service changes, service standards.

we've worked with these guys. to a large extent, the issues that we're looking for are legislative issues. it's not -- the regulator does what they're supposed to do. so, if you give them a list of ten things that they have to do, they have to do ten things. if the list is only three things, then they only do three things. you know, i think we've got a good working relationship. i think the other thing the regulator definitely has an interest in the american public and the mailers, and you have to have that balance any time you're dealing with a large organization like the postal service. >> speaking of members of congress, someone asked, "is it time to start charging members of congress something to use the postal service?" >> we do charge them. they pay. >> they do? >> yeah. i mean, the one thing about the postal service, and people have said that to us -- you can't say that -- they'll say to us, you can't say that you don't take -- that you take no taxpayer money. we don't. even things like matter for the blind, offshore voting, that's just recouping postage because of laws that were passed.

the congress, they have to pay for that. >> so, the questioner says "how do you get past each member of congress not accepting post office closings in his or her congressional district? do any of them see the so-called big picture when it comes to jobs and services in their home districts?" >> i think that congress, in congress dealing with the postal service is not a whole lot different than dealing with the rest of the issues we face in this federal government. we are a microcosm of what's happening now. there's a $7 income and a $10 spend, and you have to figure out what's the best way, the fairest way, the least effect on customers, to shrink that down. as we sit down with people and you walk through the options and you explain things, they understand. there is very few people that i've run into over there who have been adamant and wouldn't listen on any point. if you share the ideas -- and we listen, going in, trying to understand both points of view. i think that that's the approach

we're going to have to take in order to get this resolved. >> i think one of our former presidents here at the table is saying what would ben franklin, our nation's first postmaster general, do to improve postal service operations? >> i'm not sure. i think the thing that's important about the postal service is you've got to keep the basic tenants of customer service and universal service in the forefront. you know, we had these issues that we've got to figure out from a financial standpoint and we'll do that without hurting our customers. and i think that's what ben franklin would tell us. >> someone asked, "if thousands of post offices do close, what happens to the real estate?" >> well, we are selling real estate and eliminating leases as we speak. last year, i think we probably sold about $250 to $300 million worth of buildings. we'll continue that. we, you know, it's an interesting statistic with the post office. wee floor space

is owned, yet we only own about 30% of our buildings. so, we own the big ones, we lease the small ones, and as you close some of these up, you get rid of leases. now, that's where some of the pushback comes from. there's somebody out there with a lease for a post office. that's considered better than a municipal bond, right? and now, don't get rid of that! >> so, then what happens to the employees once that facility closes? >> we're working through that. you know, from an employee standpoint, we've reduced the career head count and noncareer head count in this organization by over 250,000 people since the year 2000. we've never laid anybody off. there's been a couple of people that have chosen to leave based on moving somewhere. but you know, we're proud of that. i mean, i come from pittsburgh, steel town. i watched thousands, you know, 50,000 people get laid off in one fell swoop. when you come to work for the postal service, people do a good job. you ran our motto in the beginning. even though it's unofficial,

people feel that way. and trying to work through the process with the unions, with the local people, put options out there, that's what we want to try to do as we downsize. the one thing we have in our advantage is our advantage is there's 155,000 people right now who are eligible to retire. if they retire, then they're not unempl unemployed. we have to work through those, too. >> and have you had trouble selling the facilities in what is not a great real estate? >> we had a couple that have been on the market. it's interesting. maybe two years ago was we should hold on. but to look ahead with real estate is not getting any better. you're hearing this talk about the bubble. so our feeling is sell them, put the money in the bank. >> how much impact are the current campaigns having on reversing or slowing declining

revenues? >> priority is great. if it fits, it's ship. it's great. we have a new ad probably out next week. we increased priority mail by 70%. the other thing is we are advertising right now for first class. the first time we've done it in years. the message is first class male is important. customers need to think about it that way. >> for today's small businesses owners what are the most cost-effective ways to use postal product and services. >> every door direct. if you're a realtor, i was trying to sell them, it's a very simple way to reach your customers. you can go online. you can get into the mail. and a lot of the charges that we

have, once you find it works, we have a tremendous resource of people out there in the mailing industry. they do a great job, too. it's the most direct way. it's the best return on investment in any way that you can reach your customer. >> one of the postal service unions hired ron bloom to create a low growth business plan. that was a union hire. have they talked to you about strategies or his role? >> we've talked to ron bloom. it was our people that said it was a good move. any organization that he's involved with the, focus is on how do you continue to make sure the organization thrives, they way you can provide excellent employment for the union member members. >> you talked about germany. how do you know what the rice price point is? particularly if you're trying to

stop the flow of red ink? >> well, that's been an issue for us. what we are very careful about is pricing ourselves out of business. whether catalogs or first class mail period kls. each of those provides a way to communicate with a seg m of the american public. our big fear is if you put a price change on standard mail, you'll chase people to the internet even though they went get the same return. >> you said that you stopped delivering the mail by next fall if they do not pass a bill to help you. if congress does pass a bill that gives you everything you want, how quickly do you see pulling out of the red? >> if congress gave us everything we needed we would be out of the red by the end of

2013 and getting that money back on the first overpayment would go right against debt, which would shrink our debt. we would be in excellent shape from a debt to revenue perspective. someone makes note of the fact you have prepared to distribute antibiotics in case of a bioterrorism attack. if god forbid an attack did come, how ready to you feel you are? >> we have worked with the department of human and health services and have run drills. in three or four cities. they come in and go to people's doors and delivers aebts or whatever they would need. we worked carefully with the rural car yore union. we would be ready if called upon. >> your website says you have some 216,000 vehicles that you use. what have you learned about

alternative energy to fuel them? >> well, we have run a number of small with it. we've had the largest natch ras gal leak. we've thinned that out a little bit. the key thing for us is this is you have to make good decisions with vehicles. people pitch that all the time. if we replace the fleet it will cost $7 million. we keep our fleet for 25 years. if you have a $7 million investment, you better make a good decision. if we had to make a decision there, i would go with a four cylinder gasoline engine because of the sale by far. >> is the fleet itself being reduced in size?

>> yep. we have reduced probably -- i know we're under 216 now. probably down to 211 or 212. we've been taking vehicles out of the fleet and also we've been providing vehicles to the rural carriers because it's a better vehicle to deliver out of and it's safer. probably net 12,000 to this 14,000 vehicles. >> questioner says the mail recovery center sell 200 lots of undeliverable mail at a profit. one must be in atlanta to bid and buy. are you considering internet based methods like gsa? >> i'm not so sure we should be doing that on ebay. we can look into that. a member say who is will be the first living person on a u.s. staff? perhaps lady gaga?

>> what is the time line? >> probably early next year. they have some excellent ideas. >> can you share a few? >> no, i can't. see, he's a good reporter. >> thank you. woor just about out of time. we have housekeeping matters to take care of. jim cantore the on camera meteorologist with the weather channel will be here on december 14th. that will be the next opportunity to see a journalist here at the national press club at the podium, aside from myself, perhaps. but the other thing we do is to present you with our traditional national press club coffee mug. >> thank you very much.

so here's our last question. the holidays are rapidly aproefing. busy time for shippers all over. including the postal service. when you have to mail something do you have to stand in line i got to south park postal union. i do that see i see just how our customers do it. buy all my stamps there it it works out great. they do a great job. >> thank you towel after ou ofm. i would like to thank our staff for helping to organize today's event. without her i would be dead. finally, here's a remind thear you can find out more information about the national press club on our website and if

you want to get a copy of today's program check it out at www.press.org. thank you. we're adjourned. you can see this program and more go to our website and search postal service. that's your access to c-span's archives and all related programming at c-span.org. rachel covers postal service issues for congio