Money-losing Postal Service to lose a little less money

The good news: The U.S. Postal Service proposes to take a solid step to address its annual shortfall by eliminating most mail delivery on Saturdays, saving an estimated $2 billion per year.

The bad news: That deficit isn’t $2 billion a year. It’s $16 billion a year.

There are skeptics that even the move to reduce Saturday deliveries (you’ll still see your postman at your mailbox on Saturdays if you’re expecting certain things, such as express mail and mail-order medications) will be all that effective. As Ed Morrissey notes at Hot Air, it depends in part on whether delivery trucks have the spare capacity on Mondays to handle the additional mail, or whether more drivers will require more trips back to the post office to complete their rounds.

And, as former U.S. comptroller general David Walker tells CBS News, the USPS still must “look at more fundamental changes in its infrastructure, its compensation costs, its retirement obligations, and also what it does and who does its business.” Kind of like government in general.

Still, it’s a good day when one of these long-overdue changes finally moves toward fruition (Congress still must approve the change, which always means there’s a chance common sense doesn’t prevail). Now, if only some other agencies and quasi-governmental agencies would follow suit.

– By Kyle Wingfield

Find me on Facebook or follow me on Twitter

176 comments Add your comment

Aesop's Fables and other Lib Economic Theories

February 6th, 2013
10:41 am

Wait till obozocare cuts back to being just an abortion and birth control pill provider. Then the savings will really start rolling in.

indigo

February 6th, 2013
10:44 am

Every policy decision of the USPS must be approved by Congress.

This is the same Congress that is the best money can buy.

Get the picture?

indigo

February 6th, 2013
10:45 am

Aesop

“Fables” is a good name for you as almost all your posts come from la la land.

Aesop's Fables and other Lib Economic Theories

February 6th, 2013
10:48 am

Something you should take note of, very few governmental agencies deliver their bills via email and won’t accept online payments or charge an exorbitant fee for them. It’s sorta like they’re not at all interested in saving money or eliminating unnecessary positions.

Makes you kinda wonder to what extent this attitude prevails in the rest of our massive, bottomless bureaucracy.

Aesop's Fables and other Lib Economic Theories

February 6th, 2013
10:51 am

indigo – No personal attacks, hairlip :-)

Read the blog policy – before you comment, duh. ——————-
\
\
\
——–>

Aesop's Fables and other Lib Economic Theories

February 6th, 2013
10:53 am

Oh well, that was supposed a down and to the right arrow, but sometimes things don’t go as planned…..

Hillbilly D

February 6th, 2013
10:53 am

An awful lot of people gripe about the post office but in my area, at least, I have no complaints; my local post office does a fine job. I stopped having packages shipped by UPS and Fed Ex, a long time ago. I’ve had far fewer damage problems with package damage, using the post office, than I ever had with UPS and Fed Ex, plus it’s generally cheaper.

So everybody else can cuss the post office but they do fine by me.

breckenridge

February 6th, 2013
10:56 am

Many of the Postal Service problems are union related, they are caught in the vice-like grip of the unions and the long term outlook is quite dismal unless there is some change. Where is Henry Ford when we need him….

Paul Broun announced he’s going to run for US Senate. He’s not qualified to deliver the mail, sort the mail, transport the mail or, for that matter, hold the prestigious position of city dog catcher. Let me send an email to Rove’s new PAC, see if he can’t flood the state with money to make sure Broun doesn’t embarrass the great state of Georgia in the US Senate with his anti-science idiocy. Yet another evangelical extremist whack-job posing as a republican.

Tiberius - pulling the tail of the left AND right when needed

February 6th, 2013
10:57 am

It’s not that the USPS doesn’t do a relatively good job, Hillbilly D. The issue is one of cost for that job. I have maybe 10 pieces of mail per month delivered to me that actually matter. The rest is junk mail I’ll never, ever use.

Cut out 2-3 days of delivery and alternate the routes. That will cut out maybe 1/4 of the delivery staff and begin to start saving real money.

Kyle Wingfield

February 6th, 2013
10:57 am

Hillbilly @ 10:53: Oh, I probably wouldn’t have many complaints about the USPS if it weren’t losing $16B a year. (Which, of course, really means it’s getting $16B in taxpayer subsidies.)

Numbers-R-US

February 6th, 2013
11:04 am

Indeed, Kyle. I too am looking forward to seeing the DoD expenditures cut. As for reductions in expenditures for unemployment benefits, food stamps, medicaid, etc., you should put daily pressure on the GOP to deliver on their 2010 jobs campaign.

middle of the road

February 6th, 2013
11:07 am

It would be great if the USPS could be run like a business. But what business has to ask Congress (yes, that same Congress that hasn’t passed a budeget in how many years) for PERMISSION to raise prices, or to cut Saturday delivery, or to change ANYTHING.

If you truly want them to be self-sufficient, let them make their own decisions! Or at least just mandate ONE requirement.

Kyle Wingfield

February 6th, 2013
11:09 am

Numbers @ 11:04: Oh, I think the pressure belongs on the Senate for not acting on the bills the House has passed.

Kyle Wingfield

February 6th, 2013
11:10 am

middle @ 11:07: I agree: Cut ‘em loose.

Hillbilly D

February 6th, 2013
11:11 am

Kyle

I understand your point and even agree it needs to lose less money but the post office isn’t ever going to make money, in my opinion. I also hate junk mail as much as the next person but junk mail actually subsidizes the other mail. One thing to remember, even though we all have computers, I know a whole lot of people who don’t. We all tend to get isolated in our own little worlds sometimes and forget that not everybody (probably hardly anybody, in my case) lives the same way we do. The post office is still a lifeline for a lot of folks, in my neck of the woods.

Centrist

February 6th, 2013
11:11 am

I support the postal service by ignoring companies that pretend they are green and ask that you use “paperless” billing. I want the records without printing them myself. If they want to save the printing, handling, and postage, they can offer me something in return instead of their false concern for the environment.

I also don’t mind junk mail – easy to throw out and it reduces taxpayer subsidy for postal service. But does anyone know how to really stop the daily phone solicitations for a “free” home security system? pressing 9 to opt out of further calls DOES NOT WORK. Neither does pressing 1 and asking the agent to opt the phone number out. I now tell the agents to ES&D – only makes me feel better.

Numbers-R-US

February 6th, 2013
11:12 am

Kyle,

You gotta link to that claim that the USPS has an annual deficit of 16 billion.

Numbers-R-US

February 6th, 2013
11:13 am

Kyle,

Tell us again how many jobs those house bills are projected to create. Start with that Keystone one. I always love a good laugh.

MarkV

February 6th, 2013
11:13 am

First class delivery is a public service. Even with the technological advances, such as Internet, it remains an important means of communication not just between people, but also between government agencies and people. It is not, and should not be “just business.” As such, there is no reason why it should not be subsidized by taxpayers.

MANGLER

February 6th, 2013
11:14 am

You act as if the USPS daily operations are running in the red. They aren’t. The funding of 50 years worth of pensions today is where that cost is coming from. Is it a horrible idea to fund ahead for retirement? No. Unless by doing so you create an undue burden on business which prevents it from successfully operating to that point; and how small government free market minded is that?

Kyle Wingfield

February 6th, 2013
11:16 am

Numbers @ 11:12: I already did. See the CBS News link.

Tiberius - pulling the tail of the left AND right when needed

February 6th, 2013
11:20 am

“First class delivery is a public service.”

This is the thinking on the left. First, it’s now a “service”, which puts it into some sacred category that must never be touched or altered. Then comes the following admission, which sums up the liberal train of so-called “thought”: “As such, there is no reason why it should not be subsidized by taxpayers.”

Apparently, any government program, no matter how ineffective, must run a deficit in order for others to subsidize it according to MarkV.

Numbers-R-US

February 6th, 2013
11:22 am

USPS Fiscal year Outstanding debt (billions)

2006 $2.1

2007 $4.2

2008 $7.2

2009 $10.2

2010 $12.0

Perhaps Kyle uses different definitions for debt and deficit.

Kyle Wingfield

February 6th, 2013
11:23 am

MANGLER @ 11:14: You mean the kind of “undue burden” that many, if not most, private-sector businesses already bear?

middle of the road

February 6th, 2013
11:24 am

“Is it a horrible idea to fund ahead for retirement?”

You could switch over to a 401K system like 99% of private companies have.

The one place where we NEED the postal system is in delivery of official main (certified mail, etc.). Increase prices on those and cut the numbers of days of delivery. I don’t need regular (junk, mosly) mail delivered EVERY DAY. Make it every other day.

MarkV

February 6th, 2013
11:25 am

Tiberius @ 11:20 am

As usual lots of hot air, but no contra-argument.

Kyle Wingfield

February 6th, 2013
11:26 am

Numbers @ 11:22: Well, for starters, I don’t conflate debt and deficits.

The trend for USPS operating losses (i.e. deficits) is up, with those losses currently expected to reach $21B a year by 2016. I certainly don’t think I’ve oversold the problem here.

Don't Tread

February 6th, 2013
11:26 am

Well, if you do the math, that just means the Postal Service will need to cut 7 more days per week in addition to Saturday out of the delivery schedule.

Then maybe they should cut some of the 57 states from the routes…

Tiberius - pulling the tail of the left AND right when needed

February 6th, 2013
11:27 am

MarkV, you’re reading comprehension skills remain lacking.

My contra-argument was in a previous post.

It requires you having to, you know, actually read it.

Hillbilly D

February 6th, 2013
11:28 am

But does anyone know how to really stop the daily phone solicitations for a “free” home security system?

The way I do it is that I have an answering machine. Then just let it ring and if it’s not somebody you want to talk to, don’t answer. (Caller ID would probably do the same thing but I’m too cheap to pay for that). If people call my house, they know that if they don’t talk at the beep, it’s not going to get answered.

Is it a horrible idea to fund ahead for retirement? No.

In my opinion, more businesses should be required to fund ahead. Unfunded pension liabilities, both public and private, are a big time bomb that’s going to go off some of these days. A little research on the deficits and unfunded liabilities of the Pension Benefit Guaranty Corporation, is enough to scare a person to death.

sailfish

February 6th, 2013
11:34 am

The post office is allright by me too, try mailing a letter thru ups or fedex, a $.48 stamp is a bargain. Also, there is a reason that the post office is running such a large deficit and it can be fixed, I believe there was some accounting gimmick that is unfair to the bottom line. At least thats what I’ve heard but can’t recall all the facts.

MarkV

February 6th, 2013
11:35 am

Tiberius @11:27 am

It is your comprehension that you should worry about.

“This is the thinking on the left. First, it’s now a “service”,..”

Have you present any contra-argument that it is not?

Bruno

February 6th, 2013
11:37 am

Something you should take note of, very few governmental agencies deliver their bills via email and won’t accept online payments or charge an exorbitant fee for them. It’s sorta like they’re not at all interested in saving money or eliminating unnecessary positions.

I may be a tad on the cautious side ( read: paranoid), but I’m not comfortable banking online or even paying bills online. I like having a paper copy of all payments so prefer to send checks through the mail.

MarkV

February 6th, 2013
11:37 am

All that Kyle is submitting is bellyaching about a government-attached service. Why don’t we hear from Kyle his solution? Is he for abolishing USPS? If not, why doesn’t he tell the USPS how to make their costs lower, which equipment to use, how to organize their work, etc. I am sure they would appreciate his input.

Tiberius - pulling the tail of the left AND right when needed

February 6th, 2013
11:38 am

Services are usually required to be paid for by the people receiving such, MarkV.

In your world, if it’s a government service, that’s not required.

In the real world, it is.

Tiberius - pulling the tail of the left AND right when needed

February 6th, 2013
11:40 am

Oh, and MarkV?

Never, ever try to make a point with me by parsing my comments. K?

SBinF

February 6th, 2013
11:40 am

The Post Office is solvent….Congress requires the Post Office to fully fund pensions something like 50 or 75 years out. Now the Post Office is insolvent. Let’s blame government waste.

Yes, yes that logic is perfectly sound.

And before some yahoo gets on talking about how the private sector handles it better, both UPS and FedEx contract with the USPS for shipment and delivery.

Jefferson

February 6th, 2013
11:41 am

Kyle, you don’t get it. Later in life, you might.

sailfish

February 6th, 2013
11:43 am

bruno

Used to have that same fear but the criminals have just as much opportunity with paper bills and paper banking. The key is to monitor your balance and transactions. Online banking is one of the greatest inventions for immediate accounting – ever!

Hillbilly D

February 6th, 2013
11:43 am

I may be a tad on the cautious side ( read: paranoid), but I’m not comfortable banking online or even paying bills online. I like having a paper copy of all payments so prefer to send checks through the mail.

You and me both. Remember, just because you’re paranoid doesn’t mean nobody is out to get you. ;-)

That paper copy has saved my fanny more than once.

The Post Office is specifically mentioned in the Constitution, Article 1, Section 8, so it’s not going away, any time soon.

Rafe Hollister preparing for an Obamanist America

February 6th, 2013
11:44 am

I’m with Hillbilly, I’m constantly amazed at the excellent service provided by the USPS. I’m certain that much more could be done to rein in spending, like going to 3 or 4 day deliveries. Any responsible person could observe their operation, I’m sure, like all gov agencies, and find hundreds of ways to trim costs, but then you have to get them approved by the Union. There is the rub, union agreement, public demand for continuing current services, and a scared, do nothing Congress. A good businessman running the USPS would have dropped Sat service 15 years ago.

Tiberius - pulling the tail of the left AND right when needed

February 6th, 2013
11:44 am

Just because you’re paranoid, Bruno, doesn’t mean we’re not all out to get you . . . ;)

I’ve been doing online banking and bill pay for over a decade now, and not a single thing has gone wrong. The bills get paid on time, I buy one sleeve of stamps every 2 years, and I have all the paper I need for backup if I choose to print my online bills at home.

Step into the 21st century!

getalife

February 6th, 2013
11:45 am

The house passes bills that will never pass the Senate Kyle and you know it.

Hillbilly D

February 6th, 2013
11:46 am

Online banking is one of the greatest inventions for immediate accounting – ever!

I use the old fashioned method; I write down my transaction and adjust the balance when I make it. If the checkbook says I don’t have the money, I don’t write the check. No need to worry about what’s cleared the bank, etc, that way. I’ve only had 2 checks bounce in my entire life and that was due to a mistake, on my part.

Tiberius - pulling the tail of the left AND right when needed

February 6th, 2013
11:46 am

“And before some yahoo gets on talking about how the private sector handles it better, both UPS and FedEx contract with the USPS for shipment and delivery.”

Yes, SBinF, for inefficient rural delivery routes that waste money.

Dr. Pangloss

February 6th, 2013
11:47 am

Hey, Kyle, would it be okay to mention that the PO has that deficit because Congress forced it to pay its employees’ health benefits for 10 years in advance unlike any other agency or business I’ve heard of?

MarkV

February 6th, 2013
11:47 am

Tiberius @ 11:38 am

“Services are usually required to be paid for by the people receiving such, MarkV.”

According to Tiberius, postal service (the word “service” is even in the name, USPS), the taxpayers are not the people who receive that service. Apparently the USPS delivers to extraterrestrials.

d

February 6th, 2013
11:47 am

Doesn’t Congress have the Constitutional mandate (Article I, Section VIII) to maintain the post office? Why did we transfer the United States Post Office to the semi-autonomous USPS? Also, Kyle, you may know this, how much of that $16 Billion is not actual current liabilities but part of the requirement that the USPS prefunds their retirement obligation?

Matz

February 6th, 2013
11:48 am

I’m paranoid with Bruno on this one. I write checks and place them securely into the postal system. I’ll sometimes pay online through the phone company’s website, but (having worked in banking, and knowing how much these crooks actually care about average customers) I do not trust my bank’s online banking system in the first place, let alone floating around on a wi fi!

Rafe Hollister preparing for an Obamanist America

February 6th, 2013
11:49 am

I’m with Sailfish, I think I read or saw an ad that said that some of the money that should remain with the USPS, is taken by Congress, for other purposes. The ad was trying to gain support of getting this loss of revenue stopped.