The USPS Is About To Go Out Like The Pony Express

[FarCenter]

If the postal service were a normal business it would be bankrupt. It is losing somewhere between $30m and $40m a day. But it is not a normal business. Despite not receiving federal funds, the service must answer to Congress, which has burdened it with an obsolete mission it must serve every American household, for the same price while limiting its scope to transform.

Walk into a post office in Europe or Asia and you're likely to see a range of services on offer, from banking to insurance to retailing. But in America, Congress has stopped the postal service from entering many of these fields, claiming the agency has an unfair advantage over the private sector due to its monopoly on first-class mail. Private businesses have also objected, running to legislators when the service encroaches on their turf. The first paragraph of this New York Times article offers a telling example.

Today the Senate took up legislation aimed at saving the postal service. The measure will do no such thing. It cuts in half the number of mail processing centers the service wanted to close, and delays the closing of underused post offices. It also postpones a decision on whether to end Saturday delivery, which ought to be the first reform the service enacts. The service will recoup some $11 billion for overpayments into a generous pension fund, but that may only prolong its decline. A number of amendments have been proposed, many watering down an already timid bill.

Perhaps more discouraging is the debate accompanying the proposal. Claire McCaskill, a senator from Missouri, calls plans to close rural postal offices "callous, unnecessary and irresponsible". Jeff Merkley, a senator from Oregon, calls them "devastating and economically idiotic". Yet the offices in remote areas are the ones costing the USPS the most money. Noticeably absent from the debate is any discussion of a viable long-term business plan.


Read more: http://www.businessinsider.com/economist.online.21553361.xml

[ClassWarrior]

1. If the postal service were a normal business, it would be allowed to innovate and compete.

Instead, it's being throttled by a Radical RW Congress.

Fuck your Rape-Publican talking points.

NGU.

[HiPointDem]

5. +1. i wonder if fed x has to fund their pensions 75 years out.

[GrantDem]

23. +1

[Bolo Boffin]

53. Pensions. Hah!

401(k)'s, if anything. Lots of parttimers there at Fred Smith's joint.

[Justice wanted]

2. Blame the Bush adminstration and the Congress people that has ties to UPS and HDL and Fed Ex.

Ben Franklin is probably spinning in his grave and if he could come back to life would start boxing ears badly.

[Initech]

10. Blame Reagan who made government employees the enemy.

[Justice wanted]

13. True BUT if the congress under Bush hadn't pass that stupid bill that required the post office to

pay for health care or social security (I'm sorry I forgot which one exactly) 50 years in advance they wouldn't be in this mess.

[rustydog]

21. Ding, ding, ding, ding!!!! BINGO! dead on correct.

This is a GOP plan to kill the USPS. plain and simple. billions of dollars have to come out annually to secure retirement for people not working at the postoffice yet!!!

[Canuckistanian]

3. It was not my impression that the USPS was supposed to be a profit-making venture

It was supposed to be a government service, mandated by the Constitution.

Is there ANYTHING in the Constitution that says things have to be this way?

[dmrtndl1]

8. it is not about profitibility

it was not about being profitable but more whether they were in red or black while still maintaining service, upgrade equipment to process mail quicker, pay employee medical / retirement / cost. cost of business ( rising gas prices affected post office greatly as the post office has largest service fleet in the u.s.a. Note tax dollars are not given to the post office and any monies they get are from retail services. so buy stamps, pay via mail, vote by mail, write a letter to your m om/ dad/ aunt/ uncle /cousin etc...

[safeinOhio]

14. Article I, Section 8.

Congress job is to "To establish Post Offices and Post Roads".

[FarCenter]

15. Article I, Section 8 empowers Congress. Whether to exercise the power is up to Congress.

The Congress shall have Power ... To establish Post Offices and Post Roads;

Some powers are not exercised, for example, I don't believe that Congress does this any more:

To declare War, grant Letters of Marque and Reprisal,

[dems_rightnow]

17. No it is not

That clause gives them the power to do so, if they are so inclined.

Given the changes we've seen in mail in the last couple of decades, I am not at all certain that delivering mail can contiune to be delivered cheaply and still be self-supporting.

I am all in favor of the US Government provding actual fiancial support for this agency. It's still an important service, but its ability to be both self-supporting and "profitable" is declinging, and it will get worse before it gets better.

[flamingdem]

4. The argument against the Post Office is pure BS!

We should all know by now that the house forced the prefunding for retirement funds for decades out just to destroy the Post Office.
They are profitable!!

[dmrtndl1]

6. post office rescue

the post office would not be needed to be rescued if it were not for republicans passing lame duck legislation in 2006 which required the post office to prefund 75 years of retirement for their employees. they only gave the post office 10 years to do this at 5.5 billion a year. then the recession hit. the reason this legislation was passes as post office funds are separate from th us treasury, but the retirement funds are not. thus the funds given to the retirement funds also affect the deficit and lowers it by 5.5 billion. this was just a way for congress to reach into the coffers just like congress did social security.

[flamingdem]

24. +1

[nadinbrzezinski]

9. If the USPS were a normal bidness

It woud not be required to prefund retirement for seventy five years.

[coalition_unwilling]

11. Republican union busting (the Postal Workers Union has a lot of members) is my guess. Reducing

yet another swath of middle class workers into penury, in the name of austerity.

[Luminous Animal]

12. It is cheaper and has as many services as UPS and FedEx.

I can print out shipping labels, the postage, and track and schedule a pick-up.

More people should start using it.

[WinniSkipper]

25. I have started using them more than I have in the last 5 years or so

for 'important' items. They are catching up on the technology front. For a long time, their online services did not work with Safari.

Their priority services did not match FedEx or UPS - but that is certainly changing. Private businesses have a huge advantage over public when it comes to technology investment and deployment. Government services will always lag behind the private sector in that respect. They cannot be early adopters - they have to wait for technology to be proven, and for the price to come down.

[Taitertots]

16. Do you actually believe these Rethug lies?

http://about.usps.com/news/national-releases/2011/pr11_102.htm
stop believing republican lies. There are NO problems with the Post Office, except the problems created by Republicans.

[FSogol]

18. Total BS. The USPS is a government service.

It should not be treated like a business. How many businesses need Congresses approval before raising rates? How many businesses have to have all cash on hand for future pensions. The fact that the USPS can pay part of their funding should be enough. Does the Dept of Commerce pay their own way? How about the Navy?

[Puglover]

19. Why are you posting right wing bullshit on a Democratic

website?

[FarCenter]

20. The article rightly points out that the Senate bill is not solving the USPS' problem

It is just another short-term fix, kicking the can down the road.

[nadinbrzezinski]

26. Here is something rethugs will NOT point out

If the prefunding requirement wasn't there, what problems? Even at the worst if the economy, without it, they made money, which translates to they were profitable. How is that a problem? Or did rethugs stopped believing in profit?

Now I will wait over here for rethugs to point this out, and damn it, it's been pointed to you innumerable times.

Congress, a republican congress, in a lame section, created the problems.

[HangOnKids]

27. Indeed and well said nadin!

"Congress, a republican congress, in a lame section, created the problems." Not sure why the OP does not understand this salient point.

[FarCenter]

29. Adequately funding retirement benefits is critical in a declining business

If revenues and employee headcount are declining rapidly, you can't rely on a pay-as-you-go funding arrangement.

General Motors is a good example of the problems.

[nadinbrzezinski]

31. So every business today is required to prefund

Retirees 75 years in the future. You know people not only not employed yet, worst not born yet.

Show me one, outside the USPS, in either the public or private sector required to do this in ten years.

I will wait, I suspect, for an eternity.

[WinniSkipper]

35. What private businesses now even have pensions?

I actually don't know. I haven't heard of a company pension in a while. Nowhere I have worked (other than Stage Gov't) had one

And National public pre funding has not been necessary for other departments/or services. They have enough money coming in - either through budget or resources. None are in as dire financial shape as the PO. And what would you prefer, that the PO go bankrupt without having pension money? Because the next step after that is screwing the employees out of their pension when the money is not there.

[FarCenter]

36. Very few private orgs have defined benefit pensions or retiree healthcare

The financials are far too uncertain for it to be practical. A large proportion of companies don't last for the length of a working career and a retirement. Technology, politics, and changing business environments make large numbers go out of business in a decade or two.

[nadinbrzezinski]

46. So instead of increasing benefits

We should all cut benefits and I suppose wages too. I am sure my council member, who is immigrating walker, is making your argument.

It shows how far to the right we have gone, when radical right wing views are adopted because shit it ain't happening to me.

Just love it, and yes will call them as I see them.

[WinniSkipper]

51. I will try to respond

But I really can't tell what you are saying.

The pre funding is not making the post office lose money, at least not according to the graph in the previous post. They are just losing more money. They have been especially hard hit since 2006. The business that used to support them is mostly gone - first class mail.

Their service for big money business - priority and express - is getting better and better. And direct mail is still a huge industry. They have been extremely slow to adapt from a technology standpoint. That's to be expected for government. They are getting there.

Their infrastructure is unique, and very valuable. Nobody can compete with them in getting a heck of a lot of stuff to a heck of a lot of places really fast.

One area where employees in the private sector have been the most screwed over is pensions. They have disappeared on people who worked their whole lives with a company. The Post Office has been mandated to set aside pension money. I think thats a good thing.

We should be most concerned over that, and getting the post office to adapt and leverage other potential business opportunities. The primary goal should be to keep as many of the current postal employees, with full benefits and pension as possible.

[WinniSkipper]

32. This graph, from the post office,

doesn't completely say that.

http://about.usps.com/news/national-releases/2012/pr12_0217profitability.pdf (page 3 - i don't know how to link directly to the middle of the report.)

While there a was a slight profit in 2005 (and would have been in '06 and '07 without the funding requirement), current information and projections show that the pre-funding adds to the loss, not causes it. First class mail peaked in '06 and has been in decline since.

The post office is going to have 2 choices. Either reduce costs, or look for ways to bring on more revenue so that they can protect jobs. They do have an infrastructure that is unique - they are set up to get to any door in America. That has value. Now whether we want to intermingle public/private is entirely another issue.

Someone may have info that contradicts this, I would be willing to change my opinion

[nadinbrzezinski]

33. Well the unions tell a different story

By the way Donahoe, us postmaster general, is not happy of being stopped by..wait for it, congress. They weren't happy with Donahoe doing things behind back.

As is they are doing quite a bit of business and packages are indeed a growing concern.

By the way since they are government they are allowed a small profit/ loss year, by statue. It is not a private concern.

[WinniSkipper]

34. I am sure they do

but since this is direct information from the government about the status - I sort of have to go with that until I see something else that says the pre funding is causing the losses. I would be more than happy to look at the unions figures.

I'm sorry - I don't know what this mean - "As is they are doing quite a bit of business and packages are indeed a growing concern.
"

[nadinbrzezinski]

47. As in shipping is growing.

UPS and FedEx don't like that one bit.

Have a good day. I prefer to stand with workers, not right wing hacks by the way.

[WinniSkipper]

52. Thanks for the insult

Yes - as I wrote in my other post - their big money business is much better than it was a few years ago. It has taken them some time to get there but they are becoming a threat. That is excellent news - they need to replace the revenue they have lost especially since 2006. They should be able to get back to sustainability

[CreekDog]

40. then you support the USPS acting like a business by not pre-funding 75 years in advance, benefits?

for retirees?

what other business does this?

[nadinbrzezinski]

48. They already paid more than needed

But I am sure you knew this.

Poison pill, meant to give a gift to private sector and destroy the largest union.

[CreekDog]

49. i agree completely, but i suspect the OP wouldn't support a less pre-funding of pensions/health

...for retirees.

i suspect the OP doesn't think as fondly of the USPS and its workers as you and I do.

[uponit7771]

41. +1

[Fumesucker]

22. Just wait until Fed Ex and UPS have no competition..

You think shipping is expensive now?

[ProfessionalLeftist]

28. UPS has a nasty habit of misdelivering things and extortion / bribery

Yep. That's what I said. ie: "we couldn't deliver your package because you weren't home".

The shipper didn't ask for delivery confirmation or a delivery signature. But if UPS just arbitrarily decides not to deliver your package - inserting themselves between the sender and reciever - you're screwed.

Of course you can stay home from work and wait for it the next day -- or go online and sign up (you HAVE to sign up) and have the delivery address changed. For an additional FIVE DOLLARS charged to your credit card. And really, if you wanted your goddamned package delivered to an address other than your home, you would have SPECIFIED that when you ordered it, wouldn't you? So say you have it delivered to work. Then, you get to haul it home from there and everyone gets to see it. If it's large or heavy you get to figure out how to get it into your car and home without damage to yourself or your shipped item.

All because UPS decided they didn't want to deliver it that day - because - well, you weren't home. But they'll be happy to deliver it elsewhere - for five bucks.

Does the USPS ever do this? Do they arbitrarily insert themselves between shipper and receiver and refuse to deliver packages -- without the shipper specifying that they want delivery confirmation? NO! They do not. They deliver the damn package to the address it was sent to. Period. Unless the shipper wanted confirmation/signature upon delivery - they leave the package.

Did I say bribery yet? UPS must make a fine little profit off of this extortion/bribery scheme of theirs.

I griped to a particular online business about this and asked them to use USPS instead when shipping items to me. They said they'd be happy to -- if I was willing to pay them an additional $3 in shipping.

I told them to fuck off. I'll get my stuff elsewhere, thankyouverymuch. And it WILL be delivered via USPS.

[Nye Bevan]

37. How about each other?

Or do you think they would be allowed to merge?

[Fumesucker]

42. One thing we know for sure..

Two giant companies would *never* secretly collude to raise prices..

[Nye Bevan]

44. So your theory is that we need 3 or more competing companies to avoid collusion? (nt)

[Fumesucker]

45. Reduce the chance of somewhat != avoid..

[librechik]

30. please, Congress, if you believe in small business at all, Save the USPS!!!

they are killing America when they kill the Post Office. I am just sick about this corporate takeover. Really they are saying if you are not rich in America, go die!!!

[Nye Bevan]

38. I wish they would stop Saturday mail.

An extra day without a mailbox stuffed full of catalogs and junk mail would be a pleasure.

[Egalitarian Thug]

39. Possibly the dumbest, fact-free crap I've read on this issue.

What is the point of putting this up?

[MrScorpio]

43. Business Insider is a right wing rag nt

[Odin2005]

50. This is RW BS! The USPS's problems are a creation of Republican politicians.