Skip to comments.Postal Service reports massive $5 billion loss
Posted on 11/15/2011 2:19:21 PM PST by bestintxas
The U.S. Postal Service released its annual financial results on Tuesday, and they're nothing to write home about.
The agency reported an annual loss of $5.1 billion, as declining mail volumes and mounting benefit costs take their toll. The Postal Service said its losses would have been roughly $10.6 billion if not for the passage of legislation postponing a $5.5 billion payment required to fund retiree health benefits.
PrintCommentRevenues from First-Class Mail, the Postal Service's largest and most profitable product, declined 6% from the previous fiscal year to $32 billion. Total mail volume declined by 3 billion pieces, or 1.7%.
"The continuing and inevitable electronic migration of First-Class Mail, which provides approximately 49 percent of our revenue, underscores the need to streamline our infrastructure and make changes to our business model," Postal Service CFO Joe Corbett said in a statement accompanying the figures.
Postmaster General and CEO Patrick Donahoe said in the statement that the Postal Service must reduce its annual costs by $20 billion by the end of 2015 to return to profitability.
Last year's losses hit $8.5 billion, despite deep cuts in expenses and staffing. Mail volume is down more than 20% over the past four years.
(Excerpt) Read more at money.cnn.com ...
If it was private, would already be bankrupt and gone.
What to do? One word: Privatize.
I cannot seem to truthfully comment without...
So hey, let the government run healthcare, what could possibly go wrong?
I have been trying to do my part to keep them afloat. Whenever I get junk mail I do not want, with an enclosed business reply envelope, I send all the stuff back (after removing my name/address info). Especially good for unwanted credit card offers. Sometimes they are quite heavy.
Well your records could end up in some basement undelivered for 10 years
I do that too
I have no idea if the disparity is as much now but at one time, postal employees were far better paid than other federal employees.
In 1974 I was a lowly GS-7 working overtime one Saturday in the federal building. Around 11, I took my lunch break and was eating in the break room. A young man who was a janitor came by and was cleaning up. We got into a conversation and he was a postal grade 1. We compared salaries and he was making more than I was.
My job required a college degree along with scoring pretty high on the FSEE. I think his required nothing other than being able to work.
If a private company believes they can deliver a letter from Miami to Nome, Alaska for $.44 they will take on the task.
Everyone else understands that the entirety of USPS’ work can be done. Y the Internet or FedEx.
The law requires that postal costs be met through the collection of postage from mail users, not taxes.
What this particular payment amounts to is a bit of PROFIT TAKING by Congress in a way they believe gets around the Postal Reorganization Act which prohibits such actions.
Your propagandists out there know this ~ but they don't want you to know that. Frankly, what's going on sounds silly, but that's Congress for you ~ the trick was to help balance the budget. Well, they sure forgot about that quick didn't they?
Thank goodness we voted in Republicans in 2010 so that no more money will be flushed down the Post office/Fannie Mae/Amtrak Sewer!!
The level 1s and 2s have been reserved for disabled veterans for most of a century. Expressing jealousy over the payment to multiply injured and disabled war veterans is not polite.
The big differential was at GS 5. Before Postal Reorganization postal PFS 5 was tied to GS 5 ~ your typical postal worker at that level was a clerk or a carrier. After Reorganization the postal workers got something like a 10% to 15% pay raise in the first collective bargaining agreement. It was very much in line with the then very high rate of inflation brought to you by JIMMY KKKATAH.
GS5's and so forth in the US government did not get a pay raise that year, nor the next, that was comparable to the Postal raise.
That SAVED TAXPAYERS TENS OF BILLIONS OF DOLLARS.
Again, postal workers are paid out of postage revenues. Government workers are paid out of tax revenues.
Every now and then you'll hear some uninformed regular government unionista complaining about the disparity where Postal workers get paid more ~ to which all I can say is of course, they work for a living.
Didn’t matter. You haven’t been paying tax dollars for the USPS since 1973.
FedEx doesn’t understand that.
Sign up for lots of junk mail. That’ll keep the postman happy!
I guess he could have been disabled but he sure as heck did not appear to be. Appeared to me to be around 18 years old but that was a long time ago.
Are you trying to tell me that a postal grade 1 is paid more than a postal grade 5?
“Everyone else understands that the entirety of USPS work can be done. Y the Internet or FedEx.”
I think going totally internet would be chaotic for business. Efficient yes, but the way folks change email addresses and without a good way to verify who you are sending something to, it would be a mess.
FedEx turns a profit, I’m sure they understand what it takes and how much it costs to deliver a letter package from point A to point B.
“I think going totally internet would be chaotic for business.”
Those businesses that figure out how to make a total transition from mail to the Internet will survive and those that don’t will fail.
However, the US tax payer should not have to keep the USPS running simply because some businesses are unable to make such a transition.
It’s not a business issue, it is in the fundamental design of the internet. It is just not designed to do what the postal service does.
On the other hand, fedex is an great example of a delivery business, but they are not staffed for door to door delivery like the usps is. They really do something that today there is no replacement for.
the solvency of their retirement fund is their responsibility
in case you have not noticed - this crap is sinking the cities and states
screw them - close it down - let the greedy union idiots starve
With the service they provide me, I’m not surprised. Some days I get mail and other days they send it back to the sender for no reason at all. No one there seems to know.
“They really do something that today there is no replacement for.”
No, they are doing something today that there is no market for.
And if there is no market for it, it should not exist.
The USPS is not a city nor a state.
FedEx does not provide universal service.
“No, they are doing something today that there is no market for.”
Huh? Never know it by the amount of stuff we get. People don’t do a lot of personal correspondence these days, but from businesses to the consumer, there is plenty of market.
it would be if they got their way and did not make the contributions
it does not take a city or state to have problems with retirement funds
you must be on the gravy train
His disability pay would exceed his postal pay ~ so he probably worked for nothing ~
Did you imagine severely disabled vets should get paid less than a GS5?
nobody needs delivery
the post office is not as critical to the survival of life as you want it to be
Turns out USPS employees and the USPS itself “make the contributions”.
I do that too - especially the political begging letters I get from the RNC and such, with as much as I can stuff in them!
You are right about Fedex handing off to the US Mail, UPS too.
I am expecting a package right now and the tracking number indicates it was immediately handed off to the USPS. I live in the middle of nowhere so I can understand why, but then again, I see a Fedex delivery truck pass by here every day.
screw the postal union - its THEIR retirement fund
losing money and spending money complaining about having to pay into the leeches retirement fund
That’s the $5.8 billion payment for retirees in 2087 ~ yeah, they’re trying to get out of that. NOBODY PAYS THAT! Even you don’t pay that.
There are no union operated retirement plans in USPS.
This is NOT the private sector.
sounds like a union/government statistic
face it - you are no longer needed and we are cutting off your gravy train
better grab what you can get now
I seriously doubt FedEx or any other company has the capacity to deliver 150 billion pieces of mail annually.
As for the internet. Good luck. I would be willing to bet over 50% of the population doesn’t user any sort of e-billing service whatsoever.
BTW, next time I see you think about this ~ I think I see MY MONEY in YOUR POCKET and I intend to get it back.
squeal leech squeal
I’d like your TV too. Just carry it down to the corner and I’ll pick it up. Save the costs of an armed break-in.
Fedex tracking just notified me earlier that my package was left at the porch, no signature required. Whose porch they they left the package on, they did not say. This is the second time they have done this in less than 3 weeks.
“Huh? Never know it by the amount of stuff we get. People dont do a lot of personal correspondence these days, but from businesses to the consumer, there is plenty of market.”
Hate to go high school economics on you, but in order for a market to exist, there needs to be a buyer and seller.
The buyer must be able to afford the product and the seller must be able to make a profit.
The USPS is a failed venture as it cannot survive without government subsidies.
Therefore, the USPS must be abolished.
I could Iive with no mail. Just electronic. Some people need mail and don’t want to do computers. As we old-timers pass on, that won’t be an issue.
If I were the benign dictator, we would announce a 5 year phase out of the postal service. Close more buildings faster and start selling.
Cut deliveries to 5 days every two weeks. Two days this week and 3 days next week in half the area and reverse for the other half. Start retiring and working on lay-off schedule.
Any private carrier in an area or state must offer service to every one at least once a week.
Simply because the FedEx guy cannot find your front porch is not enough reason for the USPS to shake eight billion dollars out of the tax payer.
The answer is the number of pieces of mail will be greatly reduced.
Who else but the U.S. government can get away with dumping 20,000 tons of freaking junk mail on us daily, then demand a raise?
If you announce a 5 year phase out of the USPS, either FedEx or UPS or others will revise their business plans or other companies will fill any void where there is a demand.
“Therefore, the USPS must be abolished.”
Glad you are so willing to tank so many businesses that depend on it for billing, payment and product delivery, but to each his own. I think there is a lot of room to restructure service and pricing, especially with regards to junk mailers, to fix the system.
If there is a market for delivering 150 billion pieces of mail, Fed Ex or someone else will fill that market.
“As for the internet. Good luck. I would be willing to bet over 50% of the population doesnt user any sort of e-billing service whatsoever.”
Simply because 50% of the population refuse to use e-billing does not mean the tax payer should keep the USPS afloat.
After all, we are not communists.