USPS financial straits could disrupt daily mail delivery

SAN FRANCISCO - MAY 11:  A man walks by a sign in the lobby of a post office May 11, 2009 in San Francisco, California.  The price of a first class postage stamp is increasing two cents to 44 cents today as the US Postal Service struggles with rising operational costs.  (Photo by Justin Sullivan/Getty Images)

SAN FRANCISCO – MAY 11: A man walks by a sign in the lobby of a post office May 11, 2009 in San Francisco, California. (Photo by Justin Sullivan/Getty Images)

(Associated Press) WASHINGTON — The U.S. Postal Service is warning that it will likely default on up to $6.9 billion in payments for future retiree health benefits for the fifth straight year. It is citing a coming cash crunch that could disrupt day-to-day mail delivery.

The post office says it expects cash balances to run low by October. Postmaster General Megan Brennan stressed an urgent need for federal regulators to grant the Postal Service wide freedom to increase stamp prices to cover costs. She points to continuing red ink due to declining first-class mail volume and the expensive mandates for retiree benefits.

The Postal Service on Thursday reported a quarterly loss of $2.1 billion, compared to a $1.6 billion loss in the same period last year. That came despite double-digit growth in package delivery.

4 thoughts on “USPS financial straits could disrupt daily mail delivery

  1. The dirty little secret is that Amazon is building out its own metropolitan delivery network and they are skimming the cream. Meaning where delivery is concentrated, and cheaper, they will do it themselves. Where it is spread out and expensive, we get it.

    They have ringed my city with 3 large facilities with a fleet of vans and the priority volume has collapsed. They dump their Sunday delivery on us, the absolute money loser.

    What people don’t understand is this: Once Amazon’s network is built out they will be delivering OTHER COMPANY’S parcels as well. This is what they’ve done in every other market they’ve entered.

    It’s over for the USPS and universal service. What remains to be seen is if Congress will subsidize parcel delivery outside of urban areas. My guess is no.

  2. That last paragraph no courtesy to employees is spot on. I am a 30 yr usps employee and it get harder for management to acknowledge an employee doing a great joh. Not even a thank you just work harder and faster

  3. I hate to side with the PMG on just about anything because Brennan is one of the prime architects of closing plants and reducing delivery standards. Plus, she is not qualified to be where she is – this was the result of being Pat Donahoe’s toady and who knows what else, his making sure she was right behind him every step of the way and teaching her how to be almost as ruinous as he was.
    But I have to be fair, and the future retiree funding requirement is bullshit. One good thing – if the USPS ever tried to screw with our pensions and claim lack of funds they’d get nowhere. Flexible pricing isn’t that bad of an idea if it’s adjudicated by competent financial employees who do not go crazy and price today’s employees right out of a job because the stamp prices are too high.
    But we’re talking about postal management here. Give them as much flexibility without oversight and everybody in the USPS from management down to the janitors knows where the extra money will go. Managers will find ways to inflate or outright falsify cash flow to try to score big bonuses at years’ end, and since practically everybody who could stop this embezzlement have their mitts in the same till, nothing will stop them but an independent outside entity that has the power to monitor spending every which way, managerial malfeasance, criminal activity or gross incompetence. That last one will be tough to sort out.
    I do not believe the claims that the USPS lost $2.1 billion. Labor contracts were just signed, and labor costs had to have dropped thanks to the CCA/RCA half price crews. The parcel growth has been much more successful than reported, I truly believe.
    The PMG and her lackeys are crying a sob story to try to get reform the way they want it at the expense of the employees. It’s all about taking money they haven’t earned or deserved in their “performance bonuses”, some of which are enormous. Nothing else matters. Not service. Not reliability. Not adhering to the contracts, Handbooks or Manuals. Not professional courtesy and respect to employees. Lower level PM’s, supervisors and station managers get shafted too, and we all know what’s going on. Clean up management, stop the embezzling, and focus on dependable customer service with real career carriers and employees, and the problems would end. It used to work that way, but not in the last couple of decades.

    • your comment is so right on, at our station weve got so many stupidvisors running around with nothing to do except harass carriers. a good place to start saving money is getting rid of this dead weight!

Comments are closed.