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The Postman Always Defaults Twice

Monday October 1st, 2012   •   Posted by K. Lloyd Billingsley at 12:30pm PDT   •   7 Comments

The U.S. Postal Service (USPS) recently defaulted on a $5.6 billion mandate to pre-fund retiree health benefits, the second time in two months the federal government postal “service,” has failed to deliver. In August it failed to make a $5.5 billion retirement prepayment slated for last September, which Congress conveniently deferred. So the USPS is a certified deadbeat and also a big-time loser. 

In the third quarter of the most recent fiscal year the USPS lost $5.2 billion a full $2.1 billion more than the same quarter in 2011. From 2007 to 2010, the USPS lost $20 billion. A major cause of the losses is the decline in first-class mail, its major revenue source, and in which it holds a government-mandated monopoly. That monopoly cannot prevent individuals and businesses from turning to electronic communications. Since 2001, the volume of first-class mail has fallen 19 percent and by some projections will fall another 37 percent by 2020, a return to the levels of 1986. But the USPS is not only a loser. It is also decidedly Luddite.

Its plan to expand revenues calls for businesses to send more junk mail so unionized postal workers, who make 15-20 percent more than comparable workers outside government, will have more to do. The plan is called “Every Door Direct Mail,” and USPS bosses claim that by 2016 it “could be a billion dollar product.” Maybe so, but that would not begin to offset the massive losses.

The USPS wants to stop Saturday delivery, raise postal rates, and even lose some employees. Good luck with that because like all government employees postal workers also vote for a living. A better plan would be to lift the monopoly on first-class mail and privatize the service. The USPS already competes with FedEx and UPS in shipping, where USPS business is up 9 percent.

Expensive, inefficient, massively in debt, and more concerned about employees than customers, the postal service is a fitting symbol for the federal government. On the other hand, the USPS at least gives some clue what government health care will look like. But maybe we shouldn’t be too hard on the USPS. After all, as Jay Leno says, for less than 50 cents they will carry a first-class letter all over the country for weeks. That works out to just pennies a day.



7 Responses to “The Postman Always Defaults Twice”

  1. Henry Bowman says:
    October 2, 2012 at 12:35 am

    The USPS is more concerned about employees than customers? Ha, not in one important instance. After a spate of shootings in post offices, every one of which was committed by a disgruntled EMPLOYEE, the Postal Service responded by restricting all their CUSTOMERS from entering the premises with firearms.

  2. mp says:
    October 2, 2012 at 1:45 am

    Firearms are prohibited period.
    I work for the USPS and have to say they are anything but concerned for the employee. It doesn’t matter what federal agency you talk about, centralization is BAD. customers and employees alike are going to get screwed with in ways most people can’t even imagine yet. I wonder how many lost employees “some” equals....

  3. The Postman Always Defaults Twice « lessbull.com says:
    October 4, 2012 at 6:43 pm

    [...] full post on MyGovCost | Government Cost Calculator October 5th, 2012 | Tags: always, Defaults, Postman, twice | Category: Of [...]

  4. No Name in Tennessee says:
    November 19, 2012 at 5:41 pm

    I work as an RCA (part time carrier who fills in for the fulltime carrier). I have plans to leave my job eventually, I’m starting school to be a teacher this spring. From my Opinion this is whats wrong with the Postal Service. #1 Our Unions, #2 Postal Management #3 Government
    Neither cares for the other, despite both being dependent on the other. The Unions ONLY care about our Dues being sent in and the Postal Service absolutely hates the union from years and years of dealing with them. The Union isn’t concerned that their grievances has put the Postal Service in a difficult spot. Congress put the biggest burden of prefunding the Healthcare of retirees. Add in to that so many Bill Pay services and the demise of the Hand Written Letter and the Postal Service is a Dinosaur in a Digital World. No amount of Bulk mail will save the Postal Service, I personally will take my mailbox down if all im getting is junkmail and MILLIONS of other will. I already have several houses that get only a circular once a week. I can get a digital bill from nearly every debt I currently have. How long will businesses even give you the option of physical mail? I wouldn’t if I owned a business in this economy.

    In short NOTHING will “save” the Postal Service. The Union is too concerned with maintaining the status quo and the Management is trying to streamline a business that has peaked a decade ago. I’m 36 and I’ve worked for the Post Office since I was 22. I’m disgusted with the Unions an and the Management, Fire them both and Privatize the Post Office. Otherwise the Post Office will die a very slow, very long death at the cost of Trillions.

  5. Tina Holmes says:
    November 19, 2012 at 6:30 pm

    More people, including myself use USPS to ship items purchased over the internet then ever used USPS to mail letters or greeting cards, This claim is pure hogwash. I had never paid $5.00, $6.00, $12.00 or $17.00 to mail a card or letter but I pay the above mentioned prices weekly to have items shipped to myself and relatives and that is all year long as do the majority of the human race. So how on this green earth can they possibly claim to be losing money when online ordering has exploded over the last 20 years and USPS are the ones doing the bulk of the mailing.

  6. Jeff says:
    November 19, 2012 at 10:24 pm

    well, you know if the govt. is willing to bailout Wallstreet, then they’ll definitely be there to bailout one of their own.

  7. USPS Loses $15.9 BILLION – But Bosses Receive Hefty Compensation & Raises « THE WAKING GIANT says:
    November 20, 2012 at 3:23 pm

    [...] October we noted that the U.S. Postal Service (USPS) had recently defaulted on a $5.6 billion mandate to pre-fund retiree health benefits, the [...]

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