U.S. Postal Service Delays Closings, Hopes Government Can Help

Photgraph by discpicture / Shutterstock

No one is very happy about the impending postal service cuts, which include post office location closings and plans to kill next-day mail, because it's possible it will run out of cash in less than a year. Now, the U.S. Postal Service says, "In response to a request made by multiple U.S. Senators, [the USPS] has agreed to delay the closing or consolidation of any Post Office or mail processing facility until May 15, 2012. The Postal Service will continue all necessary steps required for the review of these facilities during the interim period, including public input meetings."

Further, the USPS says, "The Postal Service hopes this period will help facilitate the enactment of comprehensive postal legislation. Given the Postal Service’s financial situation and the loss of mail volume, the Postal Service must continue to take all steps necessary to reduce costs and increase revenue. The Postal Service receives no tax dollars for operating expenses and relies on the sale of postage, products and services to fund its operations." Basically, the USPS hopes the government can come up with legislation to help it avoid bankruptcy: The Huffington Post reports, "The Postal Service, which is expected to default Friday on a $5.5 billion payment to the Treasury, is forecast to lose a record $14.1 billion next year."

At the bottom of the USPS statement, there's this note:

A self-supporting government enterprise, the U.S. Postal Service is the only delivery service that reaches every address in the nation, 150 million residences, businesses and Post Office Boxes. The Postal Service receives no tax dollars for operating expenses, and relies on the sale of postage, products and services to fund its operations. With 32,000 retail locations and the most frequently visited website in the federal government, usps.com, the Postal Service has annual revenue of more than $67 billion and delivers nearly 40 percent of the world’s mail. If it were a private sector company, the U.S. Postal Service would rank 29th in the 2010 Fortune 500. Black Enterprise and Hispanic Business magazines ranked the Postal Service as a leader in workforce diversity. The Postal Service has been named the Most Trusted Government Agency six consecutive years and the sixth Most Trusted Business in the nation by the Ponemon Institute.

In other words, it's doing a lot for the country without government support.

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By Jen Chung in News on December 13, 2011 6:25 PM

Comments [rss]

theonlybiker11

N o one is mentioning WHY the USPS is losing money. Why not? Congress, (Lame duck session) in 2006 forced the USPS to contribute SEVENTY FIVE yrs of pension payments into their system in a FIVE YEAR SPAN!
Tell me what private company could survive if they were required to do this?

Rani

I guess they can't handle the truth, as nobody has responded to your comment.

theonlybiker11

thanks Rani. It's similar to the Right wing mind set. If it doesn't fit into their "program" it is ignored.

SFNY

One easy way to help the post office: instead of recycling junk mail & the postage prepaid envelopes that come with it, just repack the envelope with the junk, seal it up, and send it back. Increases revenue for the USPS & forces the credit card companies to pay for an extra-heavy envelope.

(Of course there's the environmental impact of getting the letter back to the processing center, but there's no way to win that one. It's one of those hard choices to make.)

Regulations

Cancel Saturday delivery and charge more for junk mail.

Mordicai

I mean, I think "charge more for junk" is a no brainer, sure.

Regulations

But why not end Saturday service? Totally outdated. I believe that the USPS is necessary but in dire need o an overhaul.

Roger_the_Shrubber

Let's put these same people in charge of health care.

Politburo

Hell, why not? It's an organization ~250 years old that has adopted to countless technological advances over the years while keeping prices down.

Guest

Hell, why not keep this dinosaur going? They can't afford pensions for their employees. They can't afford to give their employees raises, but because they're part of a union, they HAVE to give them raises. Awesome adaptability indeed.

Politburo

Well they could increase prices, like most businesses have done in the last 4 years, except that was rejected by the overseeing board. (They have and continue to cut billions from expenses)

But most of USPS' problems are purely political, and as with many issues, both sides would prefer to keep the problem around.

Guest

True. And that's why government run, or assisted, businesses are doomed to fail from the start.

Mordicai

What, the people who ask for 50 cents to send a letter while corporate competitors ask for 20 dollars for the same service? I totally agree; lets put these jerks in charge. I mean, maybe there will be dozens of cents of inefficiency, but I'll take that over dozens of dollars of greedy profit motive any day. Good point.

Roger_the_Shrubber

If the corporate competitors weren't providing something for that 20 bucks people are willing to pay for, they'd be out of business.

unretrofiedforu

Really? Who's gonna pay $20 to mail a letter?

AaronRed99

We already did.

SFNY

You're misinformed.

kevd

Raise the rates companies pay for all that annoying bulk mail I get. Credit card offers, fliers, funeral plot offers etc. etc. etc. Double it. Triple it, even.

SFNY

The way to adjust it to get Congress to approve the legislation that will allow the USPS to run a little more like a business, e.g., let them move to right-sized real estate, close traditional branches in favor of locations with more convenience for customers (e.g., in-grocery store locations with longer and weekend hours)...

Politburo

This is often suggested, and I have done so in the past.

The frequent response is that this would cause bulk mailings to decline and you'd end up with even less revenue than you started with. I don't know how much that's been studied (and obviously a study is still just a guess), but it seems to be a valid point.