Copyright 1999 Journal of Commerce, Inc.
Journal of
Commerce
March 8, 1999, Monday
SECTION: TRANSPORTATION; Pg. 22A
LENGTH: 327 words
HEADLINE:
Express-package firms ask Congress for postal reform
BYLINE: BY CHRIS ISIDORE
BODY:
The recent joint venture between the U.S. Postal Service and DHL Worldwide
Express for express letters to Europe drives home the need for postal
reform to level the competitive balance, the service's competitors told
a House subcommittee last week.
""The major post offices of the world,
including the U.S. Postal Service, are in the process of launching a massive
commercial attack on private industry,'' Fred Smith, founder and chief executive
of FDX Corp., the holding company of Federal Express Corp., told the House
subcommittee on the postal service in testimony Thursday.
He cited the
agreement as an example of that new level of competition between government
monopolies and private carriers.
The committee was holding hearings on
H.R. 22, a bill that would reorganize the Postal Service into two divisions, one
to deal with competitive products such as express mail and packages, the other
dealing with noncompetitive products such as first-class and bulk letters.
A date for a new subcommittee vote has yet to be set. It passed the
subcommittee last year, but went no further and must be reintroduced. The bill
is sponsored by the panel's chairman, Rep. John McHugh, R-N.Y.
Mr. Smith
said the clear separations, or ""fire wall,'' between the two divisions is a key
to FedEx's support for the bill.
For that reason, he opposes amendments
to the current draft of the legislation suggested last month by Postmaster
William Henderson.
But he also said that the status quo is unacceptable,
and he pointed to the Postal Service's alliance with DHL, which itself is owned
in part by German postal system Deutsche Post AG, as an example of the unfair
competition possible under current regulations.
While Mr. Smith said
FedEx can support H.R. 22 as an improvement, the proposed legislation does not
go far enough for competitor United Parcel Service. Jim Kelly, UPS chief
executive, came out against the legislation in his testimony.
LOAD-DATE: July 5, 1999 
