USPS Clashes With Amazon, Trump Administration As Financial Pressure Mounts

The U.S. Postal Service clashed with the Trump administration over mask policy and failed to negotiate a new delivery deal with Amazon as it was stretched to its financial limits during the coronavirus pandemic, The Washington Post reported Thursday.

Amazon is a lucrative client for USPS. The tech conglomerate roughly drove in $3.9 billion in revenue, and $1.6 billion in profit, for USPS in 2019, the Post reported

The Postal Service delivered 1.54 billion packages on Amazon’s behalf last year, about 30% of the company’s total volume.

Tensions between USPS and Amazon rose as the postal service attempted to negotiate a new delivery contract.

The postal service can’t afford to raise rates drastically without Amazon switching gears and moving to another delivery service.

For years, USPS has been operating at a deficit. The postal service currently has $160.9 billion in debt and the pandemic has only exacerbated its financial standing. Agency officials feared in April that $23 billion in losses could accumulate in the next 18 months and that USPS could run out of money by October.

To bridge the gap, the Democratic-controlled House proposed setting aside $25 billion for USPS as part of the March debate over coronavirus relief. But the Republican-led Senate whittled that down to $13 billion, and President Trump soon after threatened to veto any bill that included direct aid to the agency in his apparent bid to cripple it ahead of an expected deluge of mailed-in ballots for the Nov. 3 general election.

This isn’t the first time USPS has clashed with the Trump administration. In April, USPS leaders worked with the Department of Health and Human Services to draft a new plan to distribute 650 million masks nationwide, enough to offer five face coverings to every American household.

However, the White House nixed the plan. Instead, HHS created Project America Strong, a $675 million effort to distribute reusable cotton face masks to critical infrastructure sectors, companies, healthcare facilities, and faith-based and community organizations. About 600 million of the 650 million masks have been distributed, an HHS spokesperson said.

“There was concern from some in the White House Domestic Policy Council and the office of the vice president that households receiving masks might create concern or panic,” an administration official said.

Trump acknowledged he downplayed the severity of the pandemic to prevent mass panic during a series of interviews with Bob Woodward for his book, "Rage."