Lost in the Mail
The U.S. Postal Service is on track to lose $23 billion a year for the next decade. Can reducing delivery to five days a week really save the system?
This year, the U.S. Postal Service will turn 235 years old. For most of its history, the USPS has not only delivered mail, but profits, too. Though not any more. In 2008, the agency began losing money. By the end of this fiscal year, it will have lost another $7 billion and will owe the government $13.8 billion. By 2020, the USPS will have lost an eye-popping $238 billion.
Today, the Postal Service went hat in hand to its regulator with a plan to save itself. It's a plan the agency spent nearly $5 billion developing. And the solution it has reached, to stop delivering mail on Saturday, is so simple, it's almost stupid. The Postal Service claims that by only delivering mail five days a week, it will save $3.5 billion a year. Its regulator, the Postal Regulatory Commission, thinks it'll be more like $1.9 billion. Either way, its peanuts considering the agency is projected to lose an average of $23 billion a year for the next decade.
GO HERE to read more from Newsweek.
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10 comments:
I view this as ONE thing. The postal service wants to increase the postage rates again and this is their way of doing it.
There was talk the other day when you posted about the Saturday deliveries here in the office.
Everyone was in agreement when I said "yeah, they'll stop Saturday deliveries but you watch, they'll still raise the postage rates too".
Looking more and more likely!
The postal service is outdated. Each time they increase their rates, more and more people turn to paying bills online. I pay all of mine that way. Much easier and dont have to worry about check getting lost in the mail.
Why does everyone cry when the USPS raises rates? Are they supposed to put an eternal hold on what they charge when the priceson everything else rise? People need to think about how many mail trucks pull up to the gas pump in a days time. Its not cheap to maintain a fleet of vehicles that constantly stop and go. Brakes, starters, tires, fuel, and other things on mail trucks are always needing to be serviced. When was the last time you went to the repair shop to see prices falling?? Next time you want to complain about a rate increase, think about how much it yould cost you to hand deliver your letter to its destination by yourself.
10:02 You are right about one thing.Everything is going up.Except everyones paycheck.We The People cant afford to keep footing the bill for poor money managment
look at how many times fedex and ups has raised its rates or added a fuel surcharge. if you want saturday delivery from either of these companies, you pay extra.
u.s.p.s. needs to be brought into the loop and be able to raise prices along the same lines as fedex and ups.
if the u.s.p.s. was run by a private company, they would be making a profit.
the federal government has never made a profit off of any of the programs they are involved in. (
Wrench, your comment is ignorant to the facts. the article even says the USPS didn't start to lose money until 2008, and they've been around a while.
I suppose the USPS and our government is telling us the truth about losing money or making profits.
I mean they are looking out for us - right?
A google search found: The Treasury calls it the "Postal Service Fund". However, taxpayers have provided $1.265 billion to the fund since 9/11/2001 (according to President's Budget for US Postal Service @ whitehouse.gov).
The US Postal Service is self sufficient. It receives NO funds from the tax payers. It hasn't since the 1971 Postal Service Reform severed the service from the Federal Government. It makes deposits into the US Treasury to pay for the annuities of it's retirees. Shortly after a rate increase, the service takes in more revenue than it has in expenses. It then builds a reserve. As costs increase, the service hits a break even point. After that it uses those reserves to pay expenses which become higher than the revenue. Then it asks the independent Postal Rate Commission for another rate increase. As you can imagine, fuel costs are a large factor in recent rate increases. The Postal Service is a non profit organization. Visit the Postal Service web site for more information. The postal rates are some of the best deals around when adjusted for inflation along side other goods and services. The Postal Service must compete with free email and other competitors in the market. And they compete very well.
tax payeers add to the fund in the amount of 1.265 BILLION dollars is not what i concider making a profit.
it took them $5 billion to come up with that idea,no wonder thier losing so much money per year lol! maybe they should cut back on thier employee benefits or maybe even some of thier routes that are way out in the boonies?
1:07, the USPS is bound by congressional mandate--law--to deliver to every single US address, boonies or not. And yes, that is one of the reasons prices go up, especially when energy costs rise. Most likely because it is so costly, UPS and FEDEX now contract with the postal service to deliver many of their own parcels to such outlying addresses. That's right, we deliver for them-LOL. I say we because I am a letter carrier, but I am only speaking for myself. Your other point though--paying $5 billion to come up with a plan that included Saturday closures (if that is an accurate number, and I doubt it) does point to a real problem--layer upon layer of the worst types of beaurocrats at every level of management in this operation. Although this is obvious to every real worker, these magnificent managers are virtually untouchable whenever layoffs or RIFs are put on the table. The predictable result: too many chiefs and not enough Indians. Surveys nationwide consistently show that the Postal Service is one of the most respected government-related organizations. (We run on revenue, not tax dollars, since 1971 by the way). Maybe if we got rid of some of the pencil pushers and frustrated drill seargeants they call supervisors and managers the real workers would be left to do the job like it should be done. As for cuts in benefits, believe me they are on the table. I don't like the thought any more than you would but I am not going to cry about it. Customer service should be king, but Saturday non-delivery is the world wide norm and polls show 60 to 70 percent of those asked are ok with it (I'd say even more of my customers that I have asked). Some of you want a guarantee from that one action alone that stamps will never rise? Of course no one could do that. No company of any type could honestly make that promise if they wished to survive and continue to provide a loved and needed all-American service.
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