The Very Survival of Nonprofits Is Being Threatened
Whew. The Great Recession failed to destroy the strong fabric of nonprofit organizations in America. We buckled but did not break. But now our own government is threatening to do what even the disastrous economy couldn't: undermine the financial viability of nonprofits in America.
Hyperbole? I wish.
At the time of this writing, Congressman Darrell Issa (R-Calif.) has proposed phasing out preferential nonprofit postal rates. It's not that he's trying to hurt nonprofits. He's trying to prevent the collapse of the U.S. Postal Service, brought on by competition from the more efficient private sector (e.g., FedEx), the Internet (mail volume is down 22 percent in five years) and decades of mismanagement of the USPS, including the capitulation to outlandish union demands that bring to mind similar mistakes made by U.S. auto manufacturers.
So the problems are real. But only in the through-the-looking-glass world of big government do people suggest that the solution to reduced sales is to actually raise prices!
Issa is right. Mostly. The USPS has to dramatically cut costs and will likely do so through the elimination of Saturday delivery, a reduction in the number of bulk-mail centers, and even the closing or relocating of thousands of neighborhood post offices. It needs to revamp the salary structure and pension benefits of postal workers. (There is no reason our tax dollars should afford them such largesse while workers in the private sector struggle for every dime.)
But the idea of phasing out nonprofit postal rates is wrong. First, it would place an undue financial burden on the nonprofit sector — which employs 13 million people and helps tens of millions of Americans. Second, if nonprofits no longer can afford to raise money cost-effectively (we all love digital, but mail still accounts for 78 percent of revenue to nonprofits), they no longer will be able to provide the services society relies on. Food banks will not be able to feed as many people. Hospitals will be forced to turn patients away.