Posted on 05/18/2011 5:36:38 PM PDT by upchuck
By James Hamilton, Econbrowser
From my ground-level perspective, postal mail is a dying industry, at least as far as it's used in academia. So I had some concerns when the Wall Street Journal ran this strongly worded editorial on Saturday:
With their $15 billion line of credit from Treasury about to be exhausted, postal workers and management are now asking Congress to let them take a pass on $5.4 billion in legally required annual contributions to prepay for retirement health benefits.
While there is honest disagreement about how much should be set aside, the Postal Service and unions essentially want to operate the fund on a pay-as-you go basis-- i.e., the same model that has got states like California into fiscal trouble. As funding falls but benefits don't, pressure will rise to dump those health costs on taxpayers-- as General Motors and Chrysler did two years ago.
The position of the Postal Service appears to be that (1) it doesn't have the money to make the $5.4 billion in payments it is required by law to make this year in order to prefund its growth in pension liabilities, (2) it shouldn't have to make the payment, since it has already overpayed $75 billion for this purpose in what it describes as an inequitable arrangement, and (3) if the accumulated pension surplus were returned to the Postal Service, it could be better used to help fund health benefits for USPS employees.
(Excerpt) Read more at finance.fortune.cnn.com ...
Yes, USPS has the lowest rates because its losses are paid for by the taxpayers. It loses money year after year, to the tune of billions of dollars, while the other shipping providers have to turn a profit to stay in business. You and I pay for USPS's losses, regardless of whether we use their services. It is much more equitable and efficient to make the people who use USPS pay higher fees to cover its losses, rather than the government forcing all of us to pay even if we don't use USPS.
Or should we just, you know, take the cost of all computers purchased in a year, pay for it with government funds, and then spread the cost across all taxpayers regardless of whether or not a given taxpayer bought a computer? Is that fair?
While were at it, would you mind buying me a new plane?
As a matter of fact - again you would need to ACTUALLY READ - the government will not change the law that forces the USPS to over fund a retirees health care system. This fund is not just for postal retirees, but many other government agencies that are NOT paying nearly as much into this system. In essence, the government that will not allow the USPS to save cost by going to 5 day delivery is forcing it to pay into this system so they don't have to. Try to wrap your limited mental capacity around what that means - taxes that you should be paying to fund bloated government agencies are being pulled from the only segment of government that is actually self supporting. The truth is the reverse of what you think it is. Ignorance is bad enough. Ignorance, stupidity and sloth is just way too much.
Take some senna - clear your head.
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