Archive for Monday, February 11, 2013

Editorial: Postal service

Congress has only itself to blame for the financial problems now facing the U.S. Postal Service.

February 11, 2013


The announcement by the U.S. Postal Service that it will drop Saturday mail delivery starting in August was a complete surprise to most Americans, including Congress, which not only has mandated six-day delivery but also is responsible for most of the financial crisis facing the USPS.

It remains to be seen whether Congress will allow the postal service to follow through on its plan and who might suffer the most if Saturday mail were discontinued.

Excuse us for a whine on behalf of the newspaper industry, but many newspapers depend upon the postal service to deliver their products, including Saturday papers that often carry high school sports news, obituaries and social items of importance to the communities they serve. If Saturday delivery is curtailed, it’s just another problem for an already troubled group of businesses. (Their problems, incidentally, include increasing competition in rates and services from the USPS itself.)

If the curtailment is allowed, it may cause issues for others who depend on Saturday service. The president of the National Association of Letter Carriers singled out the Postal Service itself, and “businesses, rural communities, the elderly, the disabled and others who depend on Saturday delivery for commerce and communication” as those who will be negatively impacted if lawmakers eventually authorize the change.

Postal service officials said the elimination of Saturday delivery is needed to cut costs, and said it will save about $2 billion a year when fully implemented. (Saturday post office box service will be retained, as will package delivery, and post offices that have been open on Saturdays will remain open on Saturdays, they said.)

The postal service’s major financial burden is a 2006 congressional mandate that ordered the post office set aside $5.5 billion a year to cover future medical costs for retirees. The service simply does not have the money. Of interest, perhaps: For whatever reason, no other federal government agency has any such requirement.

The cash-strapped agency says it has reduced its annual costs since 2006 by about $15 billion, slashed 193,000 people from its workforce and consolidated more than 200 mail-processing locations.

Perhaps it’s time for Congress either to support the USPS decision to discontinue Saturday delivery or to rescind the onerous requirement that it set aside funds for future contingencies. Push is coming to shove.


5thStPhoggers 5 years, 3 months ago

Seems like most of our problems are due to the actions or inaction of Congress-Wall Street, housing bubble, healthcare, etc. The Postal Service's issues are just the tip of the iceberg. They get elected and then spend their terms focused on how to get elected again instead of solving this country's problems. Gridlock, paralysis by analysis. Call it what you will. Why would they want to change the system and risk getting voted off the island? And they talk about "entitlements."

chootspa 5 years, 3 months ago

Their hands are tied. They're mandated to pre-fund their pensions for people that haven't been born yet, and they can't use their profits to pay off debts. They can't set the price of their own stamps without approval. They're mandated to stay open on Saturdays and deliver to every address, no matter how remote. They're not allowed to get into new markets, like offering Internet or notary services.

Exactly how much introductory economics do they need to understand that this is an impossible situation that would never be asked of a truly private business?

Carol Bowen 5 years, 3 months ago

Where did you get the idea that USPS demand is decreasing? The demand has shifted from letters to packages including transporting packages for United Parcel.

Congress has required USPS to fund retirement 75 years ahead. This has a major impact on the USPS budget. By the way, the Post Office does not cost tax payers. It is an independent entity with congressional oversight. The Post Office has been asking congress to fix problems, but it was not on congress' ToDo list.

Cant_have_it_both_ways 5 years, 3 months ago

If any organization or business does not keep ahead of their markets, move to different markets or otherwise do what they need to do to survive, then down the hole they go. Yes congress has had a lot to do with the demise of the USPS, but the unions have helped too. If there is a market for this service the private sector will pick it up which, IMHO is a good thing.

deec 5 years, 3 months ago

Congress has refused to allow the post office to offer new products and services. They also by statute forbade the post office to raise rates to cover actual costs.

The post office is not an ordinary business any more than the army or any other government service is.

The plan to privatize includes sucking off the profitable segments like processing mail and parcel delivery while leaving expensive universal delivery to the government.

Alyosha 5 years, 3 months ago

"If there is a market for this service the private sector will pick it up which, IMHO is a good thing."

That's contradicted by the fact that there is a market: FedEx itself recently used the USPS for 30% of its ground shipments — proving that the USPS can deliver ground items less expensively than FedEx itself could.

Your ungrounded habit of asserting that unions are the source of ills prevents you from seeing facts and making comments that accord with reality. Why would someone be satisfied with making claims that are a) untrue, and b) so easily disprovable? What benefit do you personally get from maintaining beliefs which are contradicted by facts?

Carol Bowen 5 years, 3 months ago

The private sector uses the Post Office for packages.

deec 5 years, 3 months ago

While demand has dropped, the main cause of the financial problems stem from the 2006 law. The post office is required to fund retirement benefits for 75 years of retirees. In addition, Congress has not allowed the post office to offer new products or raise prices to cover costs.

The 2006 law was intended to bankrupt the post office so that it would be vulnerable to privatization. There is a great deal of overlap between the postal Board of Governors and executives of Fedex, UPS and Koch-funded front groups.

Anyone interested in researching the issues facing the post office can visit this site. It has links to the pro-privatization studies, the post office budget, etc.

deec 5 years, 3 months ago

Right. Then we can all spend dozens of dollars more for the same service. For example, for me to send a 1 oz parcel within the same small town I live via Fedex would cost $17.41. The post office will do it for $2.07, and that parcel can go anywhere in the nation for $2.07.

Cant_have_it_both_ways 5 years, 3 months ago

You just summed it up. It is all about you. You don't want to pay the value of the service you desire, just like most of those on the left, it is good when someone else is paying your bills. Typical, I'll bet you are all in on public transportation, reading books at the library when you dont have to buy them yourself and all the other things the producers fund for the non producers. How about getting your habits to match up with your income?

deec 5 years, 3 months ago

Wow. Nice attempt at a personal attack rather than addressing the fact that private business is NOT more efficient or cheaper? How about the fact that Fedex subsidizes its profits by using the post office to deliver 30% of their parcels?

Cant_have_it_both_ways 5 years, 3 months ago

Again, If you owned Fedex and some entitly as dumb as the USPS that would ship your crap for less than you could do it yourself, you would laugh all the way to the drop off point. You see, the playing field is level, you can take your hard earned cash and invest in a company like Fedex and do the same thing, or you could stand on the porch and bark. Just another reason to let the USPS fail.

deec 5 years, 3 months ago

Why won't you address the fact that private enterprise is neither more efficient nor cheaper? Why do you ignore the intentional constraints placed on the post office by Congress?

Cant_have_it_both_ways 5 years, 3 months ago

There is no reason to address why private enterprise is cheaper. If you don't already know or understand then you had better head on down to the soup kitchen and let the rest of us that earn our own way pay for yours. If you would look at my first post, I did make fact that the USPS has some problems with congress. Their largest single problem is the leadership of the USPS (Unions along with congress) have written checks with their mouths their arses can't cash. I choose not to be one of the taxpaying shmucks that gets stuck paying that bill. If the USPS can't pay their bills now and dropping Saturday delivery is a good idea in August, then why is it not a good idea now?

deec 5 years, 3 months ago

The original post said "it will cost more and take longer." This is false. The postal service receives zero tax dollars. So how do you suppose you are "stuck paying the bill?"

Alyosha 5 years, 3 months ago

Do you realize, rockchalk, the FedEx recently used the USPS for 30% of its ground shipments?

So your claim is directly contradicted by business facts. It is cheaper for FedEx to use the USPS than to ship items themselves.

You should allow reality to alter your beliefs, so that your comments don't consistently make assertions that are directly contradicted by facts.

Carol Bowen 5 years, 3 months ago

It's a piggy bank just like Social Security.

Cant_have_it_both_ways 5 years, 3 months ago

Note to self: Don't enter into debates with those cradle to grave entitlement types. Surround yourself with those who go to work every day and have something going for them. They will drag you up, not drag you down.

chootspa 5 years, 3 months ago

Translation: When you're losing the argument, accuse everyone of being unemployed, and try to find an echo chamber rather than admit that you're wrong.

Alyosha 5 years, 3 months ago

Reminder to self: continue to assign zero merit to comments that make sweeping overgeneralizations ("those cradle to grave entitlement types") about people absent any supporting evidence. Such comments do nothing to advance sound public policy and a civil community.

And don't forget to encourage commenters who do engage in less-than-rigorous thinking and writing habits not to give up hope; we can all learn how to better our thinking and writing skills, and thus advance the public good!

5thStPhoggers 5 years, 3 months ago

Perhaps, if we're going to bust unions and privatize, which has been going on since Reagan, we should start with Congress. See how they feel about changing their pay and benefits. Seems to me that they are the ultimate union and, for the amount of work they actually do, they are grossly overpaid. Privatize them. Most everything they do is to further their own interests and careers. Great gig, if you can get it.

Cant_have_it_both_ways 5 years, 3 months ago

I fully agree. Congress should not be a full time job. I don't think it was ever intended to be but has morphed into one. Take away the lobby groups and it would require a fraction of the time. I would much rather see a bunch of farmers from Oklahoma making policy and passing laws than these got their hands out politicians we have now.

Carol Bowen 5 years, 3 months ago

Has it occurred to anyone that some in congress want to privatize the post office? That could be why the post office issue has not been discussed yet.

Armstrong 5 years, 3 months ago

Technology has taken a big bite out of the USPS ability to maintain business as usual. Online bill pay, ecommerce, email.... Technology is the dragon the USPS has to slay.

George_Braziller 5 years, 3 months ago

Increasingly crappy and unreliable service has also driven away business. I've sent several packages first class priority mail and none have been delivered within the three days I paid extra for to guarantee delivery time. One took 12 days to travel 200 miles from Lawrence to Hutchinson.

deec 5 years, 3 months ago

Fewer lower-paid temporary employees coupled with fewer processing facilities and post offices will further degrade service, including the loss of Saturday delivery for everything but parcels. Part of the privatization scheme involves eliminating universal service to every address in the nation.

Carol Bowen 5 years, 3 months ago

Odd. We have received worse service from the private sector. In fact, of all the frustrations we have experienced, most of them were in the private sector, not the public sector.

fu7il3 5 years, 3 months ago

My mail service in Lawrence has been awful. Mail is constantly delivered to the wrong address. People who don't live here, who have filled out countless change of address forms get mail here every single day. I spend almost as much time delivering my neighbors' mail as the postman does. Those packages that FedEx can send through the USPS cheaper get crammed in the mailbox to the point that I can't remove them without destroying the packaging. I've never had mail service this bad any other place I have lived.

chootspa 5 years, 3 months ago

Have we developed the ability to teleport packages yet?

Richard Heckler 5 years, 3 months ago

Answering the lies that privatization zealots and FedEx are peddling The Post Office is not broke--and it hasn't taken any of our tax money since 1971

This another ALEC moment. Yes this post office operation is profitable which is the reason it has been painted otherwise. Yes a fed ex executive sits on a Koch BOD's and what they see is easy consistent lifetime profits at OUR expense.

Don't get duped again!

These tax dollar moochers want all of the tax dollars that flow into Social Security Insurance,Medicare and Public Education INTO THEIR BANK ACCOUNTS. More easy profit for a lifetime.

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