I see that, as usual, the postal service is in crisis:
Last week, Senator Rand Paul used an oversight hearing on the USPS to reveal that much of its problem lies in its decision to convert 190,000 employees to permanent positions with union benefits — thus ballooning its debt. Paul told Postmaster General Louis DeJoy that he should use cheaper, contracted employees to stop the bleeding.
I have no idea where Rand Paul got that 190,000 figure. USPS is indeed starting to insource its long-haul truck routes, which have been handled by contractors for years, but inexplicably the number of long-haul contract drivers isn't public information. My best guess, based on hints here and there, is that it's maybe 50-60,000 or so.
Do unionized USPS long-haul drivers cost more than contract drivers? Beats me. Nobody at the hearing provided any evidence one way or the other. Postmaster General Louis DeJoy, a Trump appointee, told Paul "perhaps you're right," but then sort of suggested that efficiency would increase by having everything under one roof.
The postal service is a mammoth beast working under mountains of restrictions. But the underlying problem is that members of Congress are constantly saying it needs to be run like a private business but are generally unwilling to actually let it run that way. Here are a few charts to show the lay of the land. First up is delivery volume:
Delivery volume is down substantially, but the number of addresses and delivery routes keeps going up. This means the cost of delivering the mail has increased while revenues have gone down:
The postal service lost $9.5 billion last year. If it had the same operating revenue as in 2014 that would have been a $1 billion surplus. So how do you square this circle of rising costs and declining revenue? One way would be to relax the postal service's mandate for universal delivery, but Congress would never allow that. Another way would be to allow postal rates to increase a little more:
A few years ago the postal service received permission to raise rates by more than inflation—but only by a little bit. As a result our first class rates remain among the cheapest in the world:
If first class postage rose by 20 cents the postal service's $9.5 billion loss would go away. If it rose to merely the international average, it would have turned into a surplus of $9.5 billion. Any private enterprise would be able to do that, but Congress won't allow it. Constituents would complain, after all. Even regulated public utilities get a better deal than the postal service.
If Congress wants USPS to run like a private business, then butt out and let them run like a private business. Allow them to set rates and delivery standards and labor policies without a bunch of grandstanding politicians second guessing everything they do. Fat chance of that, though.
Would it? Or would the declining slope of the volume line get steeper?
Maybe we need to turn it over to Thurn and Taxis.
First class postage isn't very much of the volume, it's the price per ounce of larger packages that's the volume - and mass marketing.
Maybe lower the discounts for mass mail advertising.
That is a SPLENDID idea. But what about all those constituents who look FORWARD to having their mailboxes full of junk mail every afternoon? Imagine the rage!
No, of course it's the BUSINESSES who would rage at higher rates for their junk mail, and we can't have that can we? I mean, just think of all the lobbyists they would be forced to hire.
There's one advantage to junk mail: When I see junk mail in my mailbox I know that my mail was delivered that day. If the mailbox is empty then I'm not sure if there was no mail for me, the mail truck hasn't arrived yet, or the mail wasn't delivered (or has gone missing) for some other reason.
The PO is in an Article I constitutional provision that gives Congress the power to establish post offices and post roads. Whether it's an obligation or not may be open to interpretation, but its existence has been pretty much accepted as an obligation, along with universal delivery at uniform letter rates. And that all makes it popular, to the point that Congress mandates 6-day delivery.
The other mandate that used to get a lot of attention is the extent of pension pre-funding the PO is shackled to, far in excess of any private company. IIRC, that was inserted as a poison pill by PO privatizers who wanted to make it such a burden that there'd be no choice except to get rid of it eventually. You know, people like Ron Paul, Rand Paul, and that ilk. Last I knew, it was a significant aggravating contributor to the persistent operating deficit.
(Parenthetically, Rand Paul must be an incredible crackerjack on constituent service because he sure doesn't do squat for any other government service, as far as I know.)
Pension bit is untrue.
All private companies with pension plans must fund them as they accrue liabilities. USPS had same obligation. This is different from the federal government which operates on a pay as you go basis.
First class mail volume is going to continue to decline. We need to move to 3 day delivery.
The issue, as I said below, wasn't pensions. It was retiree health benefits. The USPS was required to prefund them for 75 years. Private companies are i>not required to do so.
Nonsense. Retiree health benefits are also paid out by the pension fund. Private company pension funds have to be funded as liabilities accrue.
You clearly know nothing about pension accounting. Any stock analyst is well aware of these issues. They are Keri elements in valuing any company with fixed benefit retiree benefits.
Nonsense?
Noted, MF who posts here in support of murders of pedestrians and bigotry, failed to cite any such evidence.
You're ignoring that the post office was original run as part of the government and thus had the pay as you go pensions. Then the republicans changed it into a quasi private entity and it had to switch to a pre-funded system. This meant it needed to both fund existing pensions and future pensions simultaneously. It never generated sufficient profits to do that. And thus the debt resulting from simultaneously fund both existing and future benefits kept getting worse.
There is no debt. There is anything to unfunded liability. It needs to be paid down.
Government pensions should also be required to find liabilities add accrued. That will force today's taxpayers to pay the full cost of government employees today and impose discipline in spending.
There is not 1 iota of truth to the nonsense you always spew here. There are absolutely no benefit to a government pre-funding it's pension obligations.
Of course there is.
If you do that you force the cost of current pension commitments into current budgets. Otherwise, it makes sense for politicians to give public employees low salaries but very generous retirement benefits because by the time the bill comes due and the cost hits the budget the politician is already retired and does not need to deal with the mess.
Governments should also move from cash accounting to accrual accounting.
Noted, MF, the guy who comes here to support murderers of pedestrians and bigotry, didn't actually cite anything to prove his case.
The Postal Service's pension obligations were the same as private firms. The difference is that they were required to also fund the health benefits of retirees. It was relieved of the requirement to fully pre-fund pension costs far into the future in 2022. The Postal Service Reform Act brought its obligations into line with other federal agencies.
https://www.uspsoig.gov/focus-areas/did-you-know/what-did-postal-service-reform-act-2022-do#:~:text=The%20PSRA%20removed%20the%20requirement,be%20decades%20in%20the%20future.
Let Elmo and that other billionaire dickhead figure this out. Afterall, aren't they in charge of saving us $T's? This couldn't possibly take more than a few hours for those geniuses to figure out a solution, its so easy!
I'd sure like the postal service to allow an opt out from junk mail. My understanding is that both management and unions oppose this because junk mail provides more money to USPS. You'd get layoffs and even bigger USPS funding shortfalls. But all that junk mail is ridiculous.
According to the USPS, around 53% of all mail is considered junk mail. 100 million trees are cut down each year to produce junk mail in the US. Junk mail produces 50 million metric tons of greenhouse gases annually.
Judging by my own mail experience, "junk mail" is closer to 80%. Just about the only things I look forward to are the bills.
Why not opt out of junk mail or at least charge what it really costs???
Can you say "K Street" boys and girls? I knew you could
Let's run the Defense Dept. like a business first.
I remember something about pretending the USPS retirement obligations:
Since 2013, the prefunding mandate is responsible for most of the Postal Service’s net losses, and it has defaulted on its prefunding payments since 2012. No other federal agency or private sector business prefunds its retirement benefits. The uncertainty inherent in satisfying the PAEA prefunding mandate is creating real instability in the Postal Service’s operations. The postal employees we represent see the consequences of this instability in their work, their workplaces, and in the service they provide the public
This legislation would repeal, in full, the onerous prefunding of retiree health care benefits mandate Congress put in place in 2006. The mandate requires the Postal Service to prefund its retiree health care benefits 75 years in advance, paying for retirement health care for individuals who haven’t been born yet, let alone entered the workforce. The mandate is accountable for 100 percent of the Postal Service’s net losses since 2007 and is a constant threat to the financial sustainability of the Postal Service.
This makes me wonder if at least part of the hostility Republicans have toward the Postal Service has something to do with the melanin content of a large portion of their workforce.
That would explain why Sen. Paul is vocally wishing worse pay for 190,000 American workers. That and/or he's a dick.
https://about.usps.com/strategic-planning/cs09/CSPO_09_087.htm
That is often a safe bet but in this particular case, I think it is more related to them just being evil in a non-racist general basis.
Can you say "K Street" boys and girls? I knew you could
and don’t forget when K-St “persuades” legislators to disallow the PO to charge at least a breakeven rate, in classic congressional chutzpah , they then pile on at hearings to berate USPS at how much money they are losing
my guess is Trump 2.0 will make sure those mail-in ballots get zero priority. Just guessin
Every private sector business is required to fund pension liabilities as they are accrued. This is the same requirement as the USPS.
Your claim that the USPS has to find retirement health care for individuals not yet born is a bald faced lie.
dilbert dogbert is correct.
https://apwu.org/usps-fairness-act
This was modified in 2022.
https://www.uspsoig.gov/focus-areas/did-you-know/what-did-postal-service-reform-act-2022-do
It took me less than 30 seconds to find this, which is less time than it took to shoot your mouth off without knowing what you're talking about.
"It took me less than 30 seconds to find this, ..."
Now find a citation from a neutral source not union propaganda.
https://about.usps.com/what/financials/annual-reports/fy2010/ar2010_4_002.htm#:~:text=Unlike%20any%20other%20public%20or,out%20until%20some%20future%20date.
15 seconds.
The USPS isn't a neutral source.
Comparisons to the private sector aren't very meaningful because few private sector companies offer comparable retirement medical benefits because of their extreme expense. The public sector offers them because they want to disguise how much they are paying their workers.
Too bad. 45 seconds is all you're worth.
You demand he find an honest source which he did, and then you spout the most ridiculous and dishonorable lies imaginable. You truly are worthless human filth.
"You demand he find an honest source which he did, ..."
I asked for a neutral source. The USPS is obviously not a neutral source. They have been whining about being forced to honestly account for their retirement benefits for years.
Um .... okay? What is your definition of a neutral source? What is your definition of an honest source? Why is it 'obvious' that the USPS? Why do you think you're being clever by demanding others do your research when people 'obviously' dismiss you for thinking you can get away this cheap and easily seen through ploy?
If you want respect here, maybe you should start by respecting others first.
my guess is you find a neutral source, and Trump 2.0 will neuter it
"... What is your definition of a neutral source? ..."
One that isn't an advocate for either side. Clearly the USPS and its workers don't qualify.
Contrary to your deliberate and intentional lie, the issue of pre-funding the pension plans has absolutely nothing to do with honest accounting for pension costs. Why do you persist in lies so stupid they insult the intelligence of your average five year old. The sole reason for moving the post office to a quasi private status and forcing the accounting change for funding the pensions was to bankrupt the post office by morally bankrupt and utterly evil human filth.
Geez... You are really obstinate and refuse to do any research on your own, because.... ??? Google "Postal Reform Act 2022" It was signed into law by {checks notes...} Joseph Robinette Biden. It did away with the prefunding requirement.
Wikipedia: https://bit.ly/3ZBC4ae
CNN: https://bit.ly/41qChPS
Congress: https://bit.ly/3DbW3of
Now go away, or I shall taunt you a second time.
It didn't completely do away with it, but yes.
The claim that the USPS must pay retiree health benefits for the unborn is an out and out lie.
What the USPS does have to do is to pay for health benefits as the liability is accrued.
For example, if retiree health benefits vest after 10 years (I don't know actual vesting period - this is an example) and if the NPV of those benefits for a 30 year old employee is $100,000 then as soon as an employee who started work as a 20 year old reaches the 10 year mark (at 30) the USPS must deposit $100,000 into its retiree health benefits fund. Some of this money may not be paid out for 75 years if this person lives to be 105. The likely odds of this, the cost of health care for the 30 year old employee when he hits 105, and the likely return on assets held in the retiree health care benefits fund are all used to calculate that $100,000 NPV.
This is exactly what the USPS should be doing. Liabilities that are accrued to delive mail today should be funded today, not dumped on future generations. If those liabilities are too high then we can increase the cost of stamps, reduce mail delivery, or automate more to reduce the number of future retirees.
MF, guy who supports murderers of pedestrians and brings in bigoted lies, doesn't support his assertion again:
Most businesses can claim income from investments and government support like medicare (and other government benefits) that the USPS cannot.
https://stories.uspsoig.gov/postal-retirement-funds-in-perspective-historical-evolution-and-ongoing-challenges/index.html
Legislation eliminating the requirement to prefund retiree health benefits was passed in 2022.
"This legislation would repeal, in full, the onerous prefunding of retiree health care benefits mandate Congress put in place in 2006. " A better idea would be for congress to cover the transition from pay-as-you-go to pre-funded pensions from general revenues if they are going to insist on mandates that require the post office to operate on a non-profit basis.
I increasingly think I'm still going to be alive when humanity transitions beyond "late-stage" capitalism and the world war that either precedes or follows it. But at least I have several dozen Forever stamps.
Bitcoin of the apocolypse!
But in this post-apocalyptic world we may not get a Postman to help rebuild the United States.
"Neither snow nor rain nor heat nor gloom of night stays these couriers from the swift completion of their appointed rounds."
On the ashes of the global network we called the internet and the prison of debris in the sky that once was a constellation of satellites, the Postman stands tall, ready to facilitate communication through one letter, with a Forever stamp, at a time.
📬✉️📭
Why not empower USPS to expand services? In many industrialized countries, the postal service offers banking. And why, in our electronic age, wouldn't "postal roads" include data services?
My anecdotes are of course not data, but given the there or four times they've misplaced important first class mail, and how much that has cost me, I'm not inclined to believe they could/should be trusted with banking or running a public data network.
In addition to my comment below (prescription drugs by mail), note that Saturday deliveries are somewhat subsidized by... Amazon. Perhaps you haven't noticed, but the USPS delivers quite a bit of Amazon merchandise. And the Post Office is an operation that runs best when it runs all the time. If you have to stop sorting and moving mail just because it's the weekend, it impacts the entire operation. It's not just the mailers you get on Saturday; there's a lot of other stuff happening on the weekend.
About your anecdotal comment about the Post Office misplacing something important... Aside from your apples and oranges comparison (physical items requiring a massive amount of handling and transfer vs. electronic data), consider the sheer volume of mail the USPS handles: 318 million pieces of mail, on average, every day. If something untoward happens to 1 in 100,000 pieces of mail, that translates to... 3,180 misdirected items per day. And that's an error rate of 0.001%. Compare that with Amazon.
The Post Office could discontinue Saturday service to **residential** customers without much impact on those customers. If behind-the-scene processes continued over the weekend, such as collection from central drop-off boxes, that would mean that only 1/6 of regular mail (that normally delivered on Saturday) would be delayed, by two days. And if the Post Office continued to deliver packages on Saturday, that would mean they'd remain competitive with other delivery services.
It's difficult to estimate exact savings, but it would certainly be hundreds of millions of dollars. And it would simplify scheduling - no need for most (part-time?) delivery workers for Saturdays.
I have never understood the wailing and gnashing of teeth every time anyone suggests stopping Saturday deliveries. I hardly ever get anything important on Monday-Friday. If I have to wait a couple more days for the regular tranche of junk mail, I think I can cope.
I get my prescription drugs by mail, so I would be one of the folks wailing and gnashing my teeth. And waiting an extra two days isn't always a good idea for... y'know... vital medication. (Our local pharmacy has short hours, isn't open on Sunday, and is actually less reliable than Express Scripts, my mail-order pharmacy.)
And with the mass closings of Rite Aid and Walgreens in my area, we're already hearing of pharmacy deserts. The kind of people dependent on regular supplies of drugs are also the kind unable to make twenty mile drives around the county to a remaining pharmacy.
And the kind of people with plenty of time to belabor their congresscritter with phone calls and threats of revenge by poll or bullets.
I just read "Precipice", a novelization of the relationship between PM Asquidth and Venetia Stanley as WW I was beginning. In 1914 and on, there were four mail deliveries PER DAY in the UK.
Better to go to 3 days per week delivery. Why do we need daily?
I suspect the APWU would take a dim view of seeing their hours/members/dues cut in half.
Then let the APWU pay the cost.
People still need to eat and have housing, mr MF-who-supports-murderers-of-pedestrians and brings in bigots points.
The cost to have those employees show up regularly does not decrease substantially as you decrease operational hours below full.
Saturday is above full.
I think it would be members. If some people were on MWF and others on TThS, postal delivery people would work two routes and maintain full time hours. That would result in a cut in delivery people but not in "upstream" workers, so the reduction would not be half, but maybe 10%.
So we seniors can get our prescription drugs in a timely fashion. You're not the only person on the planet. (And don't forget that the USPS delivers an awful lot of stuff for... Amazon.)
In addition to my comment below (prescription drugs by mail), note that Saturday deliveries are somewhat subsidized by... Amazon. Perhaps you haven't noticed, but the USPS delivers quite a bit of Amazon merchandise. And the Post Office is an operation that runs best when it runs all the time. If you have to stop sorting and moving mail just because it's the weekend, it impacts the entire operation. It's not just the mailers you get on Saturday; there's a lot of other stuff happening on the weekend.
The first thing a business would do is consolidate a whole bunch of rural post offices and cut down on the days of delivery to rural areas.
Which Republicans who represent those districts would immediately scream bloody murder about
That's just the point. Think about it...for 73 cents the USPS will pick up a letter from your mailbox and deliver it anywhere in the United States. 73 cents!!! Is there any other delivery service that can match that? And as Kevin helpfully shows, hardly any other country (most of them much smaller) can do the same.
"The first thing a business would do is consolidate a whole bunch of rural post offices and cut down on the days of delivery to rural areas. "Which is of course why it is an unbelievably stupid idea to have tried to privatize the post office. And why the founders made the post office a government agency.
+1
Why on earth should a government service be profitable? Should we also make fire departments profitable? Set some fires, charge some extras, maybe a subscription service for "express response" protection?
+10
I don't know what's changed in the billion years since I worked at the Post Office (it was my first W2 job!), but it used to be that you started as a "flexi" (short for flexible hours), a non-permanent position, and you got moved up after some short period of time on the job. So if you squint at that (and if I remembered correctly, and if it's still true) you could torture that into the Post Office "converting" some number of jobs into permanent positions. Maybe something like in other jobs, where you don't get benefits until you've been on the job for a month or three. Same deal; after that probationary period, your pay package expands, hence you cost the company more, even though that's entirely normal.
They are only allowed to convert so many, but this is converting positions which haven't been convertible for most of my lifetime.
Canada's first class mail rate is $1.15 (Canadian) for a single stamp or $0.99 per stamp in booklets. At current exchange rates that's 80 cents US for a single stamp or 70 cents US per stamp in booklets. Of course, Canada only has five days a week delivery, but on the other hand Canada Post has to service a vast thinly populated area where the cost per envelope can get very high (Canada is bigger in area than the US but has only about one-eighth of the population).
"Canada is bigger in area than the US"
Trivially bigger--only about 1.5 percent larger. And Canada is both contiguous in a way the US is not, and has its population largely concentrated in the relatively small area between Windsor and Quebec's capitol. So, it's not an entirely fair comparison (although probably closer than comparing the US to, say, France).
It's the unconcentrated population that runs up the costs. A letter from Toronto to Montreal can be moved cheaply. A letter from Toronto to Hay River is another story entirely.
The same thing applies to USPS. A letter from NY to LA benefits from economies of scale and so is cheap to handle. A letter from Seattle to Nome, on the other hand, costs WAY more than 73 cents to deliver. Most of the American population is concentrated in large urban areas where mail delivery is cheap.
If we ran the post office like a business, very rural areas would get no.service, slightly less rural areas would get limited service, big urban areas would get great service. First class envelope delivery would only happen in urban areas.
Businesses abandon unprofitable markets all the time.
The postal service is the best example to demonstrate what socialism truly is: it is the substitution of politics over free market principals when it comes to business. No business could ever operate not being allowed to charge enough to make money, or be forced to carry infrastructure well beyond what it needed or continue service it loses money on. The Postal Service is all of that and then some thanks to Congress.
And ask yourself, is that a bad deal? Considering what costs and service could be? There's a reason why the politicians act in this matter when it comes to postal service because that's what the people want Duh!