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Washington Post: Treasury Department Attempted Arguably ‘Illegal’ Takeover Of USPS

Documents show the U.S. Department of Treasury attempted to seize operational control of the Postal Service by withholding a necessary loan.

After a FOIA request, watchdog group American Oversight got over 10,000 communications records Thursday which revealed that, as the U.S. Postal Service struggled amid mounting debt and the pandemic earlier this year, Steve Mnuchin and the Treasury Department tried to get the USPS to surrender its autonomy by making a needed loan contingent on giving up control -- which puts Louis DeJoy's appointment in a whole new light, doesn't it? Via the Washington Post:

The document trove also includes three separate email chains referencing calls with Treasury Secretary Steven Mnuchin and other agency officials over nine days in early April. Two people familiar with the matter say Treasury drove a hard line, demanding operating control over the agency in exchange for the $10 billion congressionally approved loan. Such a demand was unprecedented, postal experts said, and appeared to lead the USPS to hire another law firm in the spring to study the legality of the issue. That firm, Mayer Brown, concluded that Treasury’s request was illegal.

“Any agreement by the Postal Service to surrender its authority to the Secretary of the Treasury or to the [Federal Financing Bank] therefore would be illegal,” lawyers concluded in an unreleased April 24 memo, referring to a federal borrowing entity.

The Treasury Department ultimately backed away from the idea of assuming control of USPS operations, amid swelling opposition from congressional Democrats and Postal Service leaders. During an April 9 meeting between Kipp Kranbuhl, a Treasury assistant secretary; Gary Grippo, a career Treasury official; and Postal Service executives, Grippo said Treasury would not seek to take operating control as part of the terms, according to notes from the meeting. But the agency continued to press the idea for weeks, insisting that any loan to the USPS should result in it assuming operational control of the mail agency, three people familiar with the talks said.

There's lots more, go read the entire piece to see just how many pressures the Postal Service was dealing with.

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