What result is and, clearly, what were looking at is something that is the an tistithesis of what you can see would truly exist within a competitive environment. I think its time, thank you. And this is a complicated issue. I think its time to open it up to the audience. Yes, sir . Right here. Theres a microphone . Yes, there is a microphone. The thing i learned about running an Organization Even though it was a notforprofit i was the ceo oval,f, we needed revenue. The revenue seems to be the heart of the problem. We talk about businesses. I dont know of any business that restricts its price increases to how through some other criteria other than what the market would bare. The market would bare these lower prices, they lower the prices. If the market could bare higher prices, they raised the price. I think the biggest problem, one of the big problems was the new Regulatory Regime in the post office. And congress has limit to an external inflation as the limit on how much that you can raise total revenue. At the same time, it has mandated above inflation costs to the system. And thats until you fix that, theres absolutely no way, you know you could get 50 new banks or products or stuff like that. Youre still not going to be allowed to raise the revenue. And the system is going to fail. Can you comment on that . Yeah. You hit on a key point. Ref rengserenceing a system by law mandates its market dom nant products, which is where you have the customers need to be regular lated under a c. P. I. System. Gene ref renlsed it earlier. The law did say after ten years the commission needs to look at the full ten years of experience and assess improvements changes, how that might operate. The idea was on the competitive side. The competitive marketplace would be that limit. If you go back to 2006 when this law was being finalized and put in place after 12 long years of effort. And a lot of it was to uz canfocused on the products. There was an issue that got bubbled up toward the back end which was this idea of prefunding future retiring health benefits. A huge liability that future rate payers are going to get hit with. And, at the time the decision was made this makes sense to start prefunding that. What came out of the legislation and was signed into law actually locked into place for ten years specified payments of upwards of 5 billion or more per year for ten years. After the ten years, it was ream moraltized. Back in 2006 if we all go back to the Postal Service perspective u that was they were at their peaks of revenue, volume and the Postal Service at that time, their general focus was, look, this is going to be tough for ten years. But given where were at i think we can get through those ten years make those payments and well be in a good spot. None of us would have predicted that the very next year, our nation went off into a Great Recession that rivalled the depths in some cases of the great depression. And with it, mail volume and the revenue. You hit upon a key point. While Good Intention because it was locked into statute, to undo it creates scoring issues. And theres a equally significant issue in revenues not just from the inflation cap. But from the deeply discounted rates that nonletter mail receives. Thats periodicals. Its mainly advertising. Its all the mailers you get. And that is an increasing share of the volume. And the congress has mandated, discounted, deeply discounted rates. And theyve done this in the way the congress operates. It doesnt have to be described. But if you need it we have one of americas premier political scientists here to explain it. And thats the now, thats not a subsidy. Thats a cost. And its universal service obligation. If we are going to have a hybrid form of a system which is that provides delivery that competes with private companies then we also have to introduce more competition into the other side of the market. And the first way to do that is get rid of those get rid of all of them. And let other people let other Companies Compete for that business at a market rate. I think jean may want to Say Something about this and then david. Lets talk about the government as you posed. How do you make things work when you limit the amount of income you can make with an exterm factor like inflation, versus what Congress Needs to be when it does what it has to do. Youve got a play here. Youll never be able to satisfy, successfully resolve. Youve got to play here a different ied logical perspective that drives congress. If you were to ask rand paul what he would expect the Postal Service to be like and con trastz it with what Bernie Sanders would say he thinks the Postal Service would be like it would be like night and day. The congress has never said if this is what we want to have, there needs to be a way in which it gets funded. Now, we can all talk about raising everybody e everybodys rates. Heres the important thing to keep in mind. You mean compel people as to who can put it in the mailbox or not. But, today, with electronic communication, you dont have to mail. So if you end up doing things that now makes it apparent to a business that the prices youre charging no longer facilitates their ability to use this successfully as a way of communicating and transacting business, theyll take their business elsewhere. But you still have the mandate. How do you fund the mandates in the absence of sufficient revenue if the revenue now has an opportunity to leave. I guess what i would like to point out is what robert said, the moment of passage of this legislation was important to remember. An enormous, rowbust exrobust expanding business that was approaching a cliff. Where legislators felt that mail was expanding, but there would be a time in which it would totally evaporate. There would be no Postal Service in the future, all of which turned out to be quite wrong. But the c. P. I. Cap was intended as a surrogate for efficient Market Forces. Absent efficient Market Forces tends toward bloat. So there was hope that if enough pressure applied that that would be policed. There wasnt an expanding market. C. P. I. Caps tend to work in an expanding market. They dont work very well where the market is stable in there. It is disaster where the market is declining, which is exactly what occurred. The other great pressure was prefunding. Paid 5. 5 billion a year. The potional service in its history had never made 5 billion. We make our lose 1 billion. We never made a single payment. We borrowed to make every single payment. We borrowed against a bill that we didnt have that would some day arrive. That was an odd one. And it was in the hands of opm. Opm had a couple of things going on there. One, they were desperate for money to manage what had been a fairly poorly managed pension fund for all of the government. Secondly, there were confidence problems. They had just tried to collect our pension amount to prefund earlier than that. They missed a 171 billion debt by 71 billion. Thats pretty bad. They missed the mathd problem by more than a third. Through congressional determination, and a lot can be said for it we have now put aside 335 billion. We are the most attractive takeover target in the corporate world today. But we have paid dearly for that. Weve suffered an enormous blood loss. Thank you. I think theres a question back there . Sir . Yes, good morning. Thanks for the panel. My name is john bird e byrd. Were very interested in knowing what kind of remedies would be offered, whether its congressional or regulatory, that would take a look at the evolving Market Conditions the current financial challenges and then the second part to the question would be that mismanagement. Where is that mispronounced. So to the extent that you can kind of weave each of the panelists remarks about that. Id appreciate it. Thank you. You want to start down here . Anybody want to pick those up . Well, in terms of mismanagement, again, ill leave that to somebody else. But i think to your earlier point, rob, i think, may have put his finger on it. That is the time of having a hybrid system, one that is supposed to act like a business and not suppose to act like a business may be well passed us. It may be time to say that if there are certain Core Services and we want to restrict who can provide them they ought to be organized separately and distinctly from those services that they would like from the Business Enterprise to undertake to be able to operate competitively within the marketplace. And that would mean you have to restructure Competitive Services under a Corporate Structure that would require it to have the same sorts of sets of books the same sorts of constraints to apply to anybody else in the private sector. And the whole issue of cross subsidy is immediately rolled out. Anybody else . Have a comment on that . I just want to say the defensive Postal Service here that i dont think its really an issue of mismanagement. I think its an issue of responding to themselves. That the problem with a any entity which enjoys effective insulation from competition and this applies to market dominant private companies, as well as this unusual hybrid is that the need to figure out how to be more efficient and in particular, how to inknow vat,noeknow innovate, what kind of investments should you be making . Those incentives are absent. And, consequently, they become less efficient. They become less innovative. Their costs relative to the product decline and we see, you know, the bls has quantified that. Thats what productivity captures. The quality of the managers there is any worse than the average for the private sector. I think that the way they are forced to operate is different. And it has predictable economic consequences. I think if you think about what the postal infrastructure is about, its instructive to your question. They provide universal service to all of them. There are even places that are not profitable. They do so at the lowest possible costs. So that we energize the commerce. We dont destroy commerce. Were conflictfree. Hold that thought. In europe, they attempted all of this. Something very curious happened. There were no serious takers. They said would anybody else like to do these three things . No serious takers. So is there some value in having someone just focused on energizing commerce . With no conflict of interest. And whos charging as little as they possibly can to survive. I think so. I think thats the very definition of a national infrastructure. They did it did work in sweden. Sweden is the case. Sweden has the most competitive, open system. And its worked quite well in sweden. But i would not claim that sweden that the problems facing a small, homogeneous society and one facing ours are the same. It would be different and more complicated. But they went to full privatization. I think well do the last question, the lady up here . Yes. Good morning. My name is elaine middleman. Im an attorney. I got involved in postal issues when the poset office by my house was closed even though it was profitable. Im in favor of post offices. Your point, i frankly dont understand because you want to start from scratch and pretend none of this exists. Maybe in the perfect world, that would be great. But thats not where were at. One thing that troubled me was the reporters always talk about the Postal Service is bleeding, you know, billions of dollars. And they dont seem to understand the concept of operating revenue, operating income. This 5 billion requirement makes it look like its a dysfunctional business when, in fact, as you pointed out, the last Mile Delivery is vital to the economy. Many people rely on the post office. When i go, i look at everybody. They all have a reason to be there. They have a little piece of paper and they want somebody to help them. Theyre not just buying stamps. Its a very important part of our infrastructure. Robert . I think a key point, what everyone thinks of prefunding requirement, we have to deal with the fact that its the law of the land. And, hence because of that theyre not meeting certain obligations that are required by law to meet. And, more importantly, has real world application. I went through what i saw is the bad news, the good news and the operating income is certainly some good news. But the reality is the liquidity is just not available there. That would require a legislation. And then we get into swarming issues of whether they can discuss it. And thats a challenge for congress to sort through, you know, at the end of the day, its like everything. Its going to need 218 votes of the house 51 or 60 in the senate e senate and senate and a president ial signature. But, until any of that happens, it is what it is. And it has the effect of the Postal Service where theyre at and, you know, as a result a variety of these factors we know it cut 16 billion in costs since the law took effect. I think were going to have to close this now because weve come to the end of our time. Thank you very much for opening up this issue to us. And we hope that congress is listening. [ applause ] okay, good morning, everybody. Im anne beaucheyei. U. S. Customs and Border Protection commissioner lakowski for his first state of the agency address focused on trade. As the commissioner begins his second year we thought that this was a perfect time to address the trade community and give them an overview of whats coming up. Provoting economic prosperity. We see ourselves as a parter in. Businesses are linked together through a global web of interconnected, predictable and e fishlt supply chains. U. S. Businesses rely on those supply chains to access consumers and come peet in the global markt place. Improvements that address enhance the competitiveness of all of our companies. We at the kmam beryl will continue to advance priorities that improve the performance of Global Supply chains. This advocacy will include policy and regulatory reform, pursuing effective legislation on the hill, promoting meaningful commitments to our trade partners to advanced global modernization. As the hill moves forward with trade Promotion Authority we must not forget about the bipartisan trade facilitation and trade enforcement act, or customs modernization. As you know this legislation takes aggressive action to address check points at our borders, lower the transaction cost of trade and provide needed resources for trade facilitation customs modernization and the enforcement of our intellectual property rights. As the executive order on trade facilitation enters its second year, the chamber will continue dhs and to ensure the delivery of a commercially meaningful single window that meets the white houses 2016 deadline. As the advances the trade committed to a Public Partnership for implementation. We look forward to working with cdp to modernize customs procedures by cutting red tape and bureaucracy at our global borders. With that said we know we have a Great Partnership with the kmigszer and his team. We look forward to working together to advance our shared priorities on modernizing the border processes for 21st century trade. It is now truly my pleasure to introduce the commissioner. The commissioner was nominated by president obama and sworn in in march 7, 20 14e as commissioner. Taking the helm of the 60,000 Employee Agency with a budget of 12. 4 billion. As commissioner, he leads the largest federal Law Enforcement agency and second largest revenue collecting source in the federal government. The commissioner brings nearly four decades of Law Enforcement and drug policy experience to the office of the commissioner. Previously, hes served in such distinguished positions as director of the White House National office drug house policy, chief of police in seattle washington, Police Commissioner in buffalo new york and the majority of his Law Enforcement career was spent with the saint peters burg Police Department. He has received numerous awards for community service. Thank you for your lifetime of service to our great country. Please give a warm welcome to the commissioner. [ applause ] good morning, everybody. Thank you so much for being here. And, anne thank you very much for the very warm welcome. Its always a pleasure to come to the chamber. Its always a great honor, the chamber and all of its staff had been great parter ins with cbp. And the opportunity to. So im sure there are people in florida that have nice tans that are busy watching this, also. The chamber is absolutely vital to our nations Economic Health. Its champions of american business. You help the Chamber Helps our industries compete and lead on the global playing field. I believe that another player is the Border Protection. We play a Critical Role in the effort. And the success of our vision while facilitating lawful trade and travel is intragal with competitiveness. On a typical day, and many of you know these statistics, but i wouldnt be a good fit if i didnt repeat some of them to you. Processing 4. 4 billion in exports. Trade and travel facilitation are balanced with a strong commitment to a seemless border security. It makes our mission difficult. Last may when i had a chance to speak here at the chamber i barely had two months in office. And so some people were wondering how does someone with strong Law Enforcement, ho are you going to adapt . How are you going to navigate . Its a different world and some might say that it could be f