Pascrell Postal Banking
Measure would begin building system that would serve tens of millions underbanked Americans
WASHINGTON, DC – U.S. Rep. Bill Pascrell, Jr. (D-NJ-09) today offered a bipartisan amendment to the Financial Services and General Government appropriations bill that would provide $1,000,000 in funding to begin building a modern postal banking system. Cosponsored by Reps. Mark Amodei (R-NV-02) and Ayanna Pressley (D-MA-07), Pascrell’s amendment was approved on the floor of the House of Representatives.
“Ninety percent of zip codes lacking a bank or credit union are in rural areas. Bank branches are also sparse in low income urban areas. Approximately 46 percent of Latino and 49 percent of African American households are underbanked,” Rep. Pascrell said in support of postal banking. “Think about that. Democrats and Republicans alike could derive enormous benefit for their constituents. Talk about uniting America!”
Rep. Pascrell is one of the strongest supporters of the United States Postal Service in Congress and has loudly called for protecting the post office from attacks. In a heralded April 2019 essay in Washington Monthly, Pascrell outlined the history of the post, the origins of its decay, and his remedies to undue decades of institutional damage. Foremost among them is the creation of postal banking across the nation. Pascrell is also an early cosponsor of H.R. 2382, the USPS Fairness Act, which would finally repeal the crippling health care prefunding requirement that is bankrupting the post.
The full text of Rep. Pascrell’s written statement is provided below:
The Honorable Bill Pascrell, Jr.
Statement on the floor of the House of Representatives
June 25, 2019
Madam Chair, I have an amendment at the desk.
I rise today on behalf of more than 68 million Americans who lack access to adequate banking services.
They are often shut out of banks because of fees tied to minimum balances, overdrafts, direct deposit penalties, and ATM charges. Or worse, many live in ‘bank deserts’ because incredibly, even in 2019, their community lacks a bank or credit union altogether.
This leaves underbanked Americans to turn to unregulated, predatory payday lenders and check cashers that level obscene annual percentage rates. These parasitic institutions keep families in poverty and further cement the economic inequality tearing our country apart.
It does not have to be this way. Our United States Postal Service is in a unique position to provide affordable, consumer-driven financial services these millions of Americans need. With branches in every zip code – from Paterson, New Jersey, to Elko, Nevada, to Barrow, Alaska – the post office’s unmatched reach opens a world of opportunity.
In 2014, the USPS Inspector General determined the Postal Service is well positioned to expand its financial services offerings – which currently includes money orders, check cashing, and prepaid debit card services. The IG’s report found there is a significant demand for these services from populations underserved by private banks the post could fill perfectly.
It’s difficult to overstate what this small change would do. Postal banking would benefit Americans from every walk of life.
Ninety percent of zip codes lacking a bank or credit union are in rural areas. Bank branches are also sparse in low income urban areas. Approximately 46 percent of Latino and 49 percent of African American households are underbanked.
Think about that. Democrats and Republicans alike could derive enormous benefit for their constituents. Talk about uniting America!
In a second study the USPS Inspector General conducted in 2015, the IG concluded that expanding the Postal Service’s current financial services offerings would not even cost much, is fully permissible under current statutory authority, and could generate $1.1 billion in additional revenue for USPS annually after five-years.
This is not a novel concept. Postal services in 139 countries around the world offer some form of financial services – including every other developed country in the world. And students of history would recall that the United States had a legendary Postal Savings System from 1911-1967. It managed over $3.4 billion in assets – or $35 billion in today’s dollars – at the peak of its use. I want America to back to those successes.
Madam Chair, I ask for unanimous consent to submit for the record my essay in Washington Monthly on modernizing the United States Postal Service to make the institution thrive once more and benefit tens of millions of Americans in the process.
My piece is aptly titled “Congress is Sabotaging Your Post Office” and it is high time we as a body come together to enact sensible postal reform. This amendment is a small step in that direction.
Thank you and I reserve the balance of my time.