Trump’s USPS Overhaul: Privatization, DOGE Cuts, and Ballot Order

The Trump USPS overhaul refers to a set of moves the second Trump administration has made since January 2025 to restructure the U.S. Postal Service: floated proposals to merge it into the Commerce Department, a cost-cutting partnership with the Department of Government Efficiency, roughly 10,000 workforce reductions, a new Postmaster General, and an executive order restricting how the agency handles mail-in ballots. Congress, postal unions, and a federal court have pushed back, and as of mid-2026 the ballot order’s core provisions are blocked while the agency itself is in what its leadership calls a cash crisis.

The Merger and Privatization Proposals

On February 21, 2025, President Trump described a potential restructuring of the Postal Service as “a form of a merger” with the Department of Commerce, to be overseen by Commerce Secretary Howard Lutnick. Around the same time, reports circulated that the administration was drafting an executive order to dismiss the USPS Board of Governors and absorb the independent agency into the executive branch. A White House official said on February 21 that no such order existed.¹ The Washington Post reported the aim was to “absorb the independent mail agency into his administration,” with legal experts warning the move would likely violate the law.²

Trump had signaled the direction before. In December 2024 he said privatizing the USPS was “not the worst idea I’ve ever heard” and that his team was “looking at it.” A 2018 presidential task force report from his first term had suggested a private operator might be better suited to managing declining mail volumes, potentially by reducing delivery days and stepping back from universal door-to-door service.¹

No merger order has been signed. Legal observers, including administrative law expert Rena Steinzor, told OPB that folding the USPS into Commerce or eliminating its independent structure without congressional consent would violate the Postal Reorganization Act of 1970.³

The DOGE Deal and 10,000 Job Cuts

On March 13, 2025, Postmaster General Louis DeJoy announced he had signed an agreement with Elon Musk’s Department of Government Efficiency and the General Services Administration to help the agency identify cost savings.⁴ Under the arrangement, the USPS planned to cut 10,000 workers within 30 days through a voluntary early retirement program.⁵

DeJoy pointed DOGE at what he called the agency’s “big problems”: mismanagement of retirement plan assets involving “several billion dollars,” problems with the Workers’ Compensation Program, and regulatory requirements he said restricted normal business practices.⁴ He also flagged unfunded mandates such as six-day delivery and service to remote areas, which he said cost the agency between $6 billion and $11 billion a year, and called the Postal Regulatory Commission an “unnecessary agency” that had cost the USPS over $50 billion. The Trump administration exempted the USPS from the broader DOGE-led workforce reduction mandates applied to other agencies.⁶

Rep. Gerry Connolly of Virginia called the partnership a “capitulation” that could lead to the Postal Service being “undermined and privatized.”⁵ The reductions that began in April 2025 were followed by plans for additional cuts in July 2025.⁷

New Leadership: DeJoy Out, Steiner In

Louis DeJoy announced on February 18, 2025, that it was time for the Board of Governors to begin searching for his successor, citing the multi-year nature of the agency’s reform initiatives.⁸ His final day was March 24, 2025, with Deputy Postmaster General Doug Tulino serving as acting leader during the search.⁹

On May 9, 2025, the Board of Governors selected David Steiner, the former CEO of Waste Management and previously lead independent director of FedEx, as the 76th Postmaster General.¹⁰ He officially began the role on July 15, 2025.¹¹ His stated priorities include continuing service improvement, operating in a financially self-sustaining manner, and strengthening the agency’s reputation.¹² Steiner has publicly stated his opposition to privatizing the service or converting it to an appropriated federal entity.¹³

The Executive Order on Mail-In Ballots

The most concrete change affecting the public came on March 31, 2026, when President Trump signed Executive Order 14399, titled “Ensuring Citizenship Verification and Integrity in Federal Elections.”¹⁴ The order has two main pieces relevant to mail service:

The Secretary of Homeland Security, working with the Social Security Administration, must compile and transmit to each state a list of confirmed U.S. citizens aged 18 and older at least 60 days before each federal election.¹⁴
The Postmaster General was directed to begin rulemaking within 60 days, requiring outbound ballots to carry unique Intelligent Mail barcodes and requiring the USPS to refuse to transmit ballots for anyone not enrolled on a state-specific “Mail-In and Absentee Participation List.” States wanting the USPS to deliver ballots must notify the agency at least 90 days before the election and submit voter lists through a new Federal Ballot Mail Portal.¹⁵

The order also directed the Attorney General to prioritize investigating and prosecuting anyone involved in distributing ballots to ineligible individuals, and authorized withholding federal funds from noncompliant states and localities “where such withholding is authorized by law.”¹⁴

The USPS published its proposed rule in the Federal Register on June 2, 2026, with a public comment period running through July 2, 2026.¹⁵ At a Senate Homeland Security Committee hearing on June 24, 2026, Postmaster General Steiner confirmed that if a state refused to turn over its absentee voter list, the USPS would not deliver that state’s ballots.¹⁶ He also said the agency would comply with any court order blocking the rule.¹⁷

Sen. Gary Peters of Michigan called the proposal an attempt to “coerce” states into handing over voter rolls. Sen. Elissa Slotkin urged the Postal Service to “push back on being a pawn in this authoritarian playbook.”¹⁶ Sen. Margaret Hassan of New Hampshire called the rule “blatantly illegal.”¹⁷

The Federal Court Ruling Blocking the Ballot Order

On June 25, 2026, U.S. District Judge Indira Talwani issued a 37-page opinion in California v. Trump declaring Sections 2 and 3 of the executive order “unlawful, null, and void.”¹⁸ The case was brought by 23 states and Washington, D.C.¹⁹

Judge Talwani ruled that the president lacked the constitutional authority to direct the USPS and DHS to regulate elections in this way, writing that “the Constitution does not grant the President any specific powers over elections,” with “does not” underlined.¹⁸ She found that Congress had not granted the USPS the power to create binding regulations on mail-in voting and that the executive order bypassed mandated procedural requirements for agency rulemaking.²⁰

The injunction prevents the USPS from withholding mail-in ballots and bars DHS from creating citizenship lists in the plaintiff jurisdictions. Judge Talwani ordered the Department of Justice to notify all involved agencies of their compliance duties by July 2, 2026. The administration is expected to appeal to the First Circuit.²¹

A related case, League of Women Voters of Massachusetts v. Trump, was filed on April 2, 2026, by a coalition represented by the ACLU, the Brennan Center for Justice, and other legal groups. On June 18, 2026, Judge Talwani denied part of the government’s motion to dismiss, allowing the challenge to proceed through the 2026 midterm election cycle.²²

Congressional and Union Pushback

Opposition on Capitol Hill has been broad and bipartisan. On March 10, 2025, Rep. Nikki Budzinski of Illinois led 159 members of Congress in a letter to President Trump demanding he halt any executive order to fire the Board of Governors or merge the USPS into Commerce. The letter argued the moves would violate the Postal Reorganization Act of 1970 and the Constitution’s separation of powers, noting that Section 208 of that Act reserves the power to alter the Postal Service specifically for Congress.²³

In April 2025, eight senators wrote separately to Secretary Lutnick, arguing the proposed takeover would violate the mandate that the USPS “shall be operated as a basic and fundamental service provided to the people by the Government of the United States.” They also noted the USPS had delivered over 99 million ballots during the 2024 general election cycle and cited Trump’s own 2018 task force report, which had acknowledged the USPS network “cannot be replicated by private actors.”²⁴

Two non-binding resolutions opposing privatization have collected bipartisan support. House Resolution 70, introduced January 28, 2025, by Rep. Stephen Lynch (D-MA) and Rep. Nick LaLota (R-NY), reached 218 cosponsors by July 2025, including 16 Republicans, and has since grown to 235.²⁵²⁶ Senate Resolution 147 was introduced March 27, 2025, by Sen. Gary Peters (D-MI) and Sen. Dan Sullivan (R-AK).²⁷ Budzinski also introduced the bipartisan Protect Postal Performance Act on March 14, 2025, which would prevent the USPS from downsizing facilities in underserved areas and increase transparency on proposed delivery changes.²⁸

Five postal unions endorsed the March 2025 congressional letter: the National Association of Letter Carriers, the American Postal Workers Union, the National Postal Mail Handlers Union, the National Association of Postal Supervisors, and the National Rural Letter Carriers’ Association.²⁹ In July 2025, the APWU launched a television and social media campaign in ten states and on national networks under the slogan “The U.S. Mail is not for sale,” targeting Oklahoma, Iowa, Alaska, Kansas, Maine, Mississippi, Montana, North Carolina, and South Dakota, among others. APWU President Mark Dimondstein argued that privatization would raise costs and hurt rural areas, small businesses, and the $1 trillion e-commerce industry.¹³

The Cash Crisis Driving the Overhaul

The political fight is playing out over a badly stressed balance sheet. The USPS has lost money every year since 2007, and GAO has kept its financial viability on the “High Risk” list since 2009.³⁰ In fiscal year 2025, the agency brought in roughly $80 billion in operating revenue against about $90 billion in expenses, a negative operating margin of about 11.4 percent. Strip out legacy retiree charges and the margin was roughly positive 1.4 percent.³¹

The Postal Service Reform Act of 2022 canceled $57 billion in missed retiree health pre-funding payments accumulated under a 2006 law.³⁰ The structural problem remains. First-Class Mail volumes are down 56 percent since 2007. Package revenue has grown from $10.3 billion to $32.6 billion over the same period, not enough to close the gap. The agency hit its statutory $15 billion Treasury borrowing limit in 2012 and cannot take on more debt without Congress.³¹

By early 2026, Steiner declared the agency was in a “cash crisis.”³² At the end of 2025 the USPS held about $8.2 billion in cash, roughly 33 days of operations, and leadership warned it could exhaust available funds within a year.³¹

Suspending Pension Contributions

On April 10, 2026, the USPS suspended its employer contributions to the Federal Employees Retirement System, expected to conserve roughly $200 million per pay period and about $2.5 billion through the remainder of the fiscal year.³² The agency continued to remit employee contributions and Thrift Savings Plan payments.³³

The legal authority for the suspension was quickly questioned. NARFE, the federal retiree advocacy group, noted that 5 U.S.C. § 8423 mandates employer contributions and said it was unclear what authority the Board of Governors was claiming to override that obligation.³⁴ The National Rural Letter Carriers’ Association said the USPS acted unilaterally without negotiating with unions.³⁵ The USPS cited a prior Office of Legal Counsel decision to assert that employees would continue receiving service credit toward their annuities during the suspension.³³ The USPS did the same thing once before, in June 2011, resuming payments and repaying the balance after several months.

Separately, the Postal Regulatory Commission granted a waiver allowing the USPS to repurpose roughly $2.4 billion in fiscal 2026, and up to $3 billion annually through 2030, that had been reserved for retiree benefit amortization.³⁵

What the President Can and Cannot Do Alone

Article I, Section 8 of the Constitution grants Congress the power “to establish Post Offices and post Roads.”³⁶ The Postal Reorganization Act of 1970 turned the old Post Office Department into the USPS, an independent establishment of the executive branch with its own Board of Governors, and deliberately removed it from direct presidential control.²³ The 2006 Postal Accountability and Enhancement Act added another restriction, barring the agency from offering new non-postal services without congressional approval.³⁷

Legal observers, members of Congress, and administrative law experts have consistently said that privatizing the USPS or fundamentally restructuring its governance would require an act of Congress.³⁶ Judge Talwani’s June 2026 ruling reinforced that framework, holding that the executive branch cannot unilaterally reshape how the USPS handles election mail without congressional authorization.¹⁸ With the California v. Trump ruling likely headed to the First Circuit, resolutions accumulating cosponsors, and cash reserves dwindling, the overhaul remains active but constrained: the workforce cuts and pension move have gone through, the merger has not, and the ballot rule is on hold.

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