Skip to comments.Editorial: U.S. 'Fail Mail' Needs Reform
Posted on 09/20/2011 4:22:11 PM PDT by Kaslin
Postal Politics: If the U.S. Postal Service were a regular business, it would be filing for bankruptcy protection about now. So why not let it do just that? You'll have to ask the unions for an answer to that one.
Article I of the Constitution says Congress shall have the power to "establish post offices and post roads." There's nothing here about a jobs program, but that's roughly what the modern-day postal service has become.
Yes, it still carries out an essential task, as it did in the Founders' era. But it could do that work with about two-thirds of its current workforce. That's the opinion of the Postal Service management, which is trying to run USPS like a business and not put new burdens on the taxpayers. The USPS unions, enjoying no-layoff contracts and rich benefits,think otherwise.
This long-running conflict may soon come to a head.
The USPS is, by the usual business standards, broke. It continues to lose money on shrinking mail volume down at least 20% since 2007 and knows it cannot keep raising rates to raise revenue. When the price of stamps goes up, people just use the mail less.
Now it says it cannot make a $5.5 billion retiree health payment due at the end of this month. In other words, it's on the verge of default.
A typical company in this situation would file for protection under bankruptcy law. In return for being forced to operate under a judge's supervision, it would be able to hold creditors at bay and renegotiate contracts including those with unions. This process worked for General Motors. Why not USPS?
(Excerpt) Read more at investors.com ...
Not until I use all my FOREVER STAMPS.
Either way, taxpayers are stuck with the huge pensions.
First off FEDERAL LAW prohibits the USPS from making a profit. It is required to do no more than break-even. Anyone who doesn't understand that probably shouldn't comment on USPS.
Secondly, the thing grinding down USPS at the moment is called a $5.2 billion fee they are required by FEDERAL LAW to pay to Congress every year just for the possibility some future retiree 75 years from now might need medical insurance.
As bizarre as that sounds the FEDERAL GOVERNMENT doesn't want to give up the money. So far I think they've paid $20 billion on that account.
If they hadn't, they'd not owe $15 billion in debt, and have $5 billion in cash for operating their business.
IBD must certainly understand what's going on here ~ if the FEDERAL GOVERNMENT didn't force the USPS to operate without a profit, and if the FEDERAL GOVERNMENT didn't demand special payments for ridiculous projects, they would be doing well despite the Great Obama Recession.
As far as laying off employees goes, they've already cut 150,000 positions, and are seeking approval to get rid of another 250,000.
IBD should write their Congresscritters if they want that to happen. Kvetching about it in an editorial is so cowardly ~ just complain to the people who are preventing action.
Frankly, IBD is usually so pro Democrat, so pro Socialist, so pro Union, I can't take them seriously when it comes to USPS personnel matters. They're just stirring the pot ~ nothing more than that, and Fur Shur they'll be an intervenor in the very next Postal Rate Commission rate case trying to protect their considerable subsidy for their trashy periodicals.
Once per week mail delivery for residential would be sufficient.
“The agency said it will be forced to default on some of its financial obligations this year unless Congress changes a 2006 law requiring it to pay between $5.4 and $5.8 billion into its prepaid retiree health benefits each year.”
FedEx, for comparison since they offer a pretty good plan, pays $2800 into its pension plan per employee. The USPS must pay $8600 per employee per year for its plan. How many times have we bailed out FedEx over pension costs?
What are you talking about?
Taxpayers are stuck with nothing.
How you can say both things in one paragraph and then confound them is beyond me.
Fed Ex employees after retirement will be able to also collect Social Security. Postal retirees hired before 1984 are covered under the Civil Service Retirement System and for many of them, their pension is all they have and it is relatively modest AND TAXABLE, and if they ever become eligible For Social Security by working their forty quarters, they are hit with the pension offset against double dipping which reduces their SS to about forty percent. It is shocking to me how the public is jumping all over the postal workers who processed and delivered their mail for many years.
In my area, the Post Office is talking about closing mail processing centers in the counties outside Pittsburgh, so that the big city will be served first, and those people will keep their jobs, but the more rural counties where there are not a lot of jobs anyway, will suffer. Too bad for Greensburg area where incidentally a lot of conservatives reside, the postal workers there with seniority will be offered the possibility of a long commute to Pittsburgh, some will be forced into retirement or off the rolls with nothing, and the local communities will see a drop in residents spending money for their services as ex-postal employees start to live like refugees. Do not rejoice in such a large group of workers losing their jobs.
Intersting. thanks for updating us
“Frankly, IBD is usually so pro Democrat, so pro Socialist, so pro Union”
“Pro-union?” Are you sure you’re picking up the correct IBD at the newsstand?
Nothing, that is, except for the small matter of the bailouts they constantly ask for. You’ve already pointed out that the USPS is mandated to maintain revenue-neutrality; what do you think they should do if in fact they lose $10B this year, as projected? Are you in favor of yet more bailouts, or are you going to agree that their business model is broken and needs to be retooled?
Are you a postal worker?
What bailouts? It’s uncle sam who is asking for a bailout from USPS.
This was started just a few years ago ~ it wasn't one of the founding principles.
At the same time the Postal Rate Commission will not allow USPS to raise prices sufficient to pay the $5 billion. Simultaneously Congress has passed laws to prohibit the USPS from cutting costs to come up with the $5 billion.
Taxpayers are not paying one thin dime. On the other hand the folks who pay postage are subsidizing the US government to the tune of $5 billion per year ~ and the same government is forcing the postal service into insolvency.
YOU PEOPLE ARE INCOMPETENT!
Actually, it’s the USPS which is incompetent. Are you suggesting that they should not have to fund their future pension obligations?
If the postal workers’ union didn’t exist, maybe it would be a different story. Unfortunately for the USPS, their model doesn’t work as it stands, having to pay union pensions.