According to a report on Friday in The Washington Post, President Donald Trump personally pressured the U.S. Postal Service to double the rate that it charges Amazon for delivering packages.
Trump asked U.S. postmaster general Megan Brennan to double the rate charged Amazon as well as other companies for the USPS to deliver packages, said the report citing three unnamed sources.
Thus far Brennan has resisted the demand made by Trump, explaining in several conversations that have taken place both last year and this year that the arrangements are tied to contracts and a regulatory commission must review them, said the three sources.
Brennan told Trump that the relationship with Amazon is beneficial to the USPS and gave him slides showing the different companies, besides Amazon, that partner for deliveries.
The demands made personally by Trump began in 2017 and Brennan had meetings with Trump on several occasions. The report by the Washington Post said the most recent Trump-Brennan meeting was four months ago, just after Trump started to criticize Amazon deal with the USPS.
In December a tweet by Trump asked why the USPS, which is losing billions annually, while charging so little to Amazon as well as others to deliver packages, makes Amazon richer and our Post Office poorer and dumber.
In April Trump started again with the tweets saying that Amazon cost the USPS huge amounts of money and that the USPS was Amazon’s delivery boy.
In 2017, the USPS posted a 2.7 billion net loss on revenue of $69.6 billion. Critics argue the agency should increase its prices for package delivery to help cover the losses.
It has been estimated that since Amazon is one of the largest customers for USPS in its packaging delivery business that raising prices could result in billions of dollars in additional costs for the e-commerce behemoth.
The report said that there is a split internally between Trump aides on whether higher prices should be paid by Amazon to the USPS. Outside of the Trump Administration, many people and that includes Patrick Donahoe the postmaster general, have argued that the logic of Trump is flawed.
During one conversation Donahoe had in April he explained the USPS’ business was split between its mailing of letters and magazines, that the government service is only allowed to deliver and its competitive products such as packages that rival delivery companies such as UPS and FedEx could deliver.