DEPARTMENT OF THE TREASURY
WASHINGTON, D.C.

SECRETARY OF THE TR EAS 

August 20, 2020

The Honorable Charles E. Schumer
Minority Leader

United States Senate

Washington, DC 20510

Dear Senator Schumer:

I learned from a press release issued by your of?ce this week that you are interested in better
understanding the Department of the Treasury?s interactions with the US. Postal Service (USPS)
Board of Governors concerning the Board?s independent selection and appointment of a new
Postmaster General. I would have been pleased to address your questions and concerns directly
and welcome the opportunity to clear up any confusion.

As Secretary of the Treasury, I chair the Federal Financing Bank (FFB). The FB is the sole
lender to USPS, which currently has $14.4 billion in outstanding debt to the FFB, including $3.4
billion drawn by USPS in April 2020. Every year, I am asked to make a commitment to pledge
the full faith and credit of the United States to guarantee debt to the FFB, to the extent
needed and requested, based on my statutory determination that such a pledge is ?in the public
interest.? This is not a symbolic gesture. Like any responsible creditor or guarantor, I take
seriously my responsibility for sound stewardship of taxpayer dollars that the FF lends and the
US. Treasury guarantees, including the multibillion-dollar credit line extended to USPS on
behalf of US. taxpayers. In my role as FB Chairman, I receive and review quarterly ?nancial
information provided by USPS and, on occasion, request other information relevant to the
?nancial soundness of the organization. On December 23, 2019, I wrote a letter (enclosed) to
the USPS Board of Governors requesting that the Board undertake an empirical evaluation
concerning whether largest e-commerce package delivery contracts are competitively
priced and, more generally, whether pricing strategies subsidize any of major
private-sector customers to the ?nancial detriment of USPS. In the same letter, I also asked the
Board of Governors to keep me apprised of the Board?s search for a new Postmaster General, as
appropriate, because strong management is essential to the ?nancial health of USPS.

As you know, on May 6, 2020, Louis DeJoy was appointed Postmaster General on a bipartisan
basis by the independent USPS Board of Governors with the support of a Board member who
served in the Obama Administration and whom you recommended to the White House. Neither I
nor any other Treasury of?cial played any role in recruiting or suggesting Mr. DeJoy for the
position of Postmaster General. In fact, I was surprised to learn that Mr. DeJoy was a candidate
for the position when the Governors updated me on the status of the selection process and

informed me of their ?nalists. While I appreciated the opportunity to be briefed on the process
as principal creditor, the decision was made by the Board alone.

I share your interest in ensuring that USPS has a strong and sustainable future. I believe that
requires meaningful reform of its current business model?not privatization. As you know, in
April 2018, I was asked to chair the Task Force on the United States Postal Service and to
evaluate the operations and ?nances of USPS. USPS has been losing money for more than a
decade and is forecast to lose tens of billions of dollars over the next decade. Through our work
which involved extensive stakeholder outreach, the Task Force made public recommendations
that would enable USPS to develop a new business model that would account for the steady
decline in traditional mail volumes and increases in package deliveries. The Task Force?s
recommendations were designed to enable USPS to continue to deliver high-quality service,
without shifting additional costs to the taxpayers. I have enclosed a copy of the Task Force
report for your reference.

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Please do not hesitate to contact me if you have any further questions.
Sincerely,
wa?g
Steven T. Mnuchin

cc: The Honorable Robert M. Duncan, Chairman, USPS Board of Governors