Postal rate increases could kill small magazines, association warns
Rate increases being considered by the U.S. Postal Service could put many
small periodicals out of business, according to a trade association for the
magazine industry. Postal Service officials could not be reached for comment, but the chief lobbyist for the Magazine Publishers of America said the agency is
planning to seek a 15% to 20% across-the-board increase.
This would translate into an even higher increase for periodicals,
according to Jim Cregan, executive vice president for government affairs at the
association.
“While the rate increase won’t put the largest magazines out of business,
it just might be the death knell for many smaller publications – notably ones
that express political points of view,” Cregan said.
In a recent letter to President Bush, the governors of the Postal Service
said the agency is facing a $2 billion deficit this year. They appealed for a
bipartisan campaign to change the 31-year-old law that regulates the
agency.
The magazine publishers plan a major lobbying campaign to block a hefty
new increase, which would follow a 9.9% rate hike for periodicals that took
effect Jan. 7.
“We hope to convince them not to pull the trigger on this. They’d be
shooting themselves in the head,” he said.
“The last thing any business should be doing in a downturn is to increase
prices. From a strategic point of view, if they are in trouble and need
help lobbying Congress for postal reform, the last thing they ought to be doing
is alienating their best and most influential friends that would be smacked
with this increase,” he said. .”This is like pouring gasoline on a fire.”
While Cregan said the Postal Service plans to file for the increase in
June, it would probably take at least 18 months before the new rates, if
approved, could take effect. That’s because of the procedures mandated by the Postal Reorganization Act.
The Magazine Publishers of America has 200 members that publish some 1,500
magazines, according to Cregan.
William Armbruster can be reached at [email protected]
JOURNAL OF COMMERCE, 07th March 2001
