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BLACK A3
DAILY 03-02-10 MD SU A3 BLACK
TUESDAY, MARCH 2, 2010 KLMNO S A3
POLITICS THE & NATION
In Savannah, skepticism over a recovery Postmaster delivers
As Obama visits city to bundle of bad news
push economic policies,
many remain wary
Three studies — by Accenture,
by Ed O’Keefe the Boston Consulting Group and
McKinsey and Co. — reviewed the
by Michael A. Fletcher The U.S. Postal Service will re- Postal Service’s books and pre-
lease projections Tuesday that sented 50 options for cuts and
savannah, ga. — To hear confirm for the first time the sus- new services. The agency’s busi-
President Obama tell it, his plans picion that mail volume will nev- ness model is so poor, consultants
for reshaping the nation’s econo- er return to pre-recession levels. concluded, that privatizing it is
my are aimed at helping people In response, the agency is push- untenable.
like Ray Gaster, whose small ing anew for a dramatic reshap- As for Postal Service plans to
chain of lumberyards here has ing of how Americans get and sell banking, insurance and cell-
been walloped by the recession. send their letters and packages. phone services through post of-
Gaster’s business has plum- Customers are continuing to fices, the consultants point to the
meted by more than two-thirds migrate to the Internet and to agency’s lack of start-up funds
since 2006. At the same time, cheaper standard-mail options, and inability to afford potential
health insurance costs are be- and away from the Postal Serv- short-term losses.
coming an increasingly heavy ice’s signature product — first- But the Postal Service will ask
burden. Yet Gaster has nothing class mail, Postmaster General Congress to cut mail delivery to
but skepticism for Obama pol- John E. Potter will report in an- five days per week, a move
icies designed to lighten that nouncing the projections. backed by a June Gallup survey
load. He says the economic stim- The Postal Service experienced that found 52 percent of Amer-
ulus package has been all but in- a 13 percent drop in mail volume icans support eliminating Satur-
visible to his business, and he last fiscal year, more than double day deliveries in order to reduce
fears the White House’s renewed any previous decline, and lost costs.
effort at overhauling health care
PHOTOS BY STEPHEN MORTON FOR THE WASHINGTON POST
$3.8 billion. The projections an- Other possible changes carry
would only make a bad situation Tourism has helped lessen the ticipate steeper drops in mail vol- much greater risk: Officials can
worse. recession’s impact in Savannah, ume and revenue over the next 10 seek permission from the Postal
“You know what it’s like work- Ga., where the unemployment years, and mounting labor costs Regulatory Commission to in-
ing with the government. It’s just rate is lower than the national only complicate the agency’s path crease prices beyond the rate of
impossible,” he said. “The health- figure. But Ray Gaster, right, to firm fiscal footing. inflation, but doing so could
care system we have now isn’t said that business at his In an effort to offset some of scare away more customers.
perfect, but at least it works.” lumberyards has dropped by the losses, Potter seeks more flex- The agency also plans to ex-
Obama plans to visit this two-thirds since 2006, and that ibility in the coming year to set plore offering “hybrid mail prod-
charming coastal city on Tuesday the impact of the stimulus delivery schedules, prices and la- ucts” that deliver some mail to
to lead a day of meetings aimed at package has been negligible. bor costs. The changes could customers via e-mail, Potter said.
highlighting his economic pol- mean an end to Saturday deliver- Officials will also seek greater
icies and shoring up support for Still, he feels the pain of the ies, longer delivery times for let- flexibility in forthcoming union
his ambitious but endangered do- economic downturn and the ters and packages, higher post- negotiations, including address-
mestic agenda. Success could ul- skewed economics of health care. age-stamp prices that exceed the ing ballooning health-care costs,
timately turn on his ability to re- His company runs several loca- rate of inflation, and the poten- Potter said.
shape perceptions of a stimulus tions around Savannah, and it tial for future layoffs. He particularly wants Con-
plan that the White House says has 125 employees, down 25 over “At the end of the day, I’m con- gress to reverse a 2006 law re-
has pumped more than $130 mil- the past two years. His payroll is vinced that if we make the chang- quiring the Postal Service to pre-
lion into the local economy, but down $30,000 a week over that es that are necessary, we can con- pay its retiree health benefits, to
many here grumble about what time. Ask about the impact of the tinue to provide universal service the tune of $5 billion per year. No
they see as its lack of effective- stimulus plan and he says: “I ha- fore her. Although unemploy- plan to intervene in the economy for Americans for decades to other federal agency or Fortune
ness. ven’t seen where it has added any ment is high, she said she spends is unnecessary. She also said it come,” Potter said Monday. “We 500 company makes such pay-
In Savannah, as elsewhere, that jobs.” an undue amount of time trying has left her afraid to spend. She is can turn back from the red to the ments, Potter said.
view is feeding a broader distrust His firm offers health insur- to find reliable armored-car driv- planning to add a half-bath, roof black, but there are some signifi- The agency’s call last year to
of government that threatens to ance to workers, which costs the ers and other employees for jobs shingles and a new air condition- cant changes we need to make.” consolidate about 3,000 post of-
undermine the president’s ambi- company $425,000 a year, even that offer up to $14 an hour to ing unit to her home at the Land- The postmaster general called fices drew a firestorm of protest
tions and political support. though only two-thirds sign up start, plus benefits. ings, a gated waterfront commu- for many of these changes last from the public and lawmakers.
“I think that people don’t see for it. Other employees are cov- Turnover in her branch has nity just south of Savannah. She year but failed to convince law- But the Postal Service is con-
the impact because it is not ered by their spouses, and maybe been 80 percent since May, she said she has the money, but she is makers. This time he’s armed sidering more next year, closing
there,” said Rep. Jack Kingston 10 percent, Cook estimates, go says. “It’s like people don’t want still waiting. with $4.8 million worth of out- thousands of locations and mov-
(Ga.), who like nearly every Re- without. to actually do the work once they Asked for what, she hesitated side studies that conclude that, ing some products and services to
publican in Congress voted He wants health-care reform, get a job,” she said. before saying: “All this Obama without drastic changes, the mail nearby supermarkets, office sup-
against the stimulus measure a but he does not want government Her experience has led her to stuff has me concerned.” agency will face even more seri- ply stores and pharmacies.
year ago and opposes much of the to play a big role in the final prod- conclude that the president’s fletcherm@washpost.com ous losses. ed.okeefe@washingtonpost.com
rest of Obama’s domestic agenda. uct. “The things we heard about
Even some supporters of the health care as a business owner
president’s policies complain that are scary,” he said. “That puts the
the stimulus money is not flow- brakes on decision making. You
ing fast enough. “The speed in certainly aren’t going to make
which the applications have been any decisions to expand.”
approved has really been a little Cook said the best way to get
frustrating,” said Savannah May- business people like him to hire
or Otis S. Johnson (D), who none- more workers is to have govern-
theless praised the plan for sav- ment lower taxes while easing up
ing teaching and other public on mandates and regulations. “I
service jobs while providing know people laugh at the term
funding for long-overdue proj- ‘trickle-down economics,’ ” he
ects. said. “But it works. I hire more
“We are at the end of the first people, they get to spend money,
year of the stimulus, and we and so on.”
would think that more of the His is a common refrain
money would be out now,” the among business owners in Savan-
mayor said. nah. “The stimulus plan has had
Such criticism frustrates the only a negligible, if any, effect on
Obama administration. It calls the local economy, outside of gov-
the stimulus plan an unqualified ernment,” said Gaster, who flew
success, bringing $21 million in Chinook helicopters in Vietnam
infrastructure money, $38.5 mil- and built his business from
lion in education funds, $4 mil- scratch, starting in 1985. “ What
lion in transportation aid and we need is an increase in the vol-
$20 million in small-business ume of business. Period.”
loans to Savannah alone. Asked whether the stimulus’s
“The Recovery Act put 63,000 weatherization provisions have
people back to work in Georgia, helped him sell business sup-
provided tax cuts to nearly 3.5 plies, he feigned disbelief. “If I
million Georgia families and had to depend on weatheriza-
made it possible for more than tion,” he said, “I’d be out of busi-
SHOE
1,200 small businesses to grow ness.”
and hire,” said Amy Brundage, a Even amid the complaints, the
White House spokeswoman. economy here has held up better
Obama has defended his eco- than most. Savannah’s unemploy-
nomic policies — from the bank ment rate is 8.4 percent, well be-
and auto bailouts to the $862 bil- low the national rate of 9.7,
lion stimulus plan, health-care thanks to the throngs of tourists
reform and a cap-and-trade sys- who wander the city’s sprawling
tem to limit greenhouse gases — historic district, the bustling port
clearance
as aimed at helping the nation re- and the city’s proximity to major
cover from the severe downturn military installations, including
while seeking to rebalance an Fort Stewart, Ga., and the Marine
economy that has gotten out of Corps installation at Parris Is-
C
OLE HAAN
whack. land, S.C.
DONALD J PLINER
The president frequently notes The stimulus plan has played a
FR
ANC
O S
A
R
T
O
SON
that the economy has tilted role, too, although not everyone
toward giving too many of its re- recognizes its impact. The plan
JE
S
SIC
A SIMP
wards to top income earners and provided $33 million to perform
relying too heavily on unbridled maintenance dredging and spoil LINEA P
A
OL
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ORS
consumerism. The government containment in the port, millions
MICHAEL MICHAEL K
can pave the way toward a more more to keep teachers on the pay-
AN
prosperous and equitable future, roll, money to weatherize some
MUNRO AMERIC
he says, by investing in educa- public housing units and demol-
tion, infrastructure, health care ish others, support for people
NIKE
and renewable energy. But if the thrown out of work and tax
attitudes of small-business peo- breaks for 95 percent of workers
S
AM EDELMAN
STARTS WEDNESDAY, MARCH 3
ple and others here are any in- and many small businesses. SÖFFT
dication, convincing people that “The president’s challenge is to
government is up to the job will come up with an explanation for S
T
E
VE MADDEN
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be difficult. his policies that people can un-
“To many people, government derstand and see,” said Pete Lia-
S
TU
AR
T WEIT
ZMAN
VIA SPIG
A
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is not seen as a problem solver, kakis, a Democrat who chairs the
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Charles S. Bullock III, a Univer- lot of people don’t know what’s
sity of Georgia political scientist. happening or understand what’s
Trey Cook, the genial chief op- happening. But they hear people
erating officer of Savannah Tire, a talking about trillions and tril-
car-repair firm that has been in lions of dollars, and they wonder,
his family for three generations, ‘Who’s going to pay for that?’ ”
counts himself firmly in the camp Jan Macchi, the local branch
of the wary. “What’s that old line manager for Loomis, a cash-man-
— ‘Hi, I’m the government. I’m agement firm, struggles to recon-
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BLACK A3
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