[NEWS.INVESTORS] Declining business and rising expenses are not exactly a recipe for long-term business success, but that is exactly what's going on at the U.S. Postal Service right now, the Government Accountability Office told a congressional panel on Thursday.We used to get maybe a letter a week from the postman while I was growing up, back when Caesar was a PFC. The postman wore a sun helmet in the summer, and he walked his route with a big leather bag on his shoulder. He worked for the government, though I believe they were on a separate pay scale. Delivering mail was a service provided by the government. Ben Franklin was the first Postmaster General, so if it was good enough for them way back then it would have been good enough for me now. You don't run a government service for a profit, though I suppose the Navy could capture quite a few container ships before they started an actual war.
The GAO found that the volume of mail, particularly First Class, continues to drop as people increasingly migrate to texts and email, paying bills online and going paper-free for bank statements and the like.
What we get as mail now would mostly be classified as "spam" if it came electronically. First class mail rates are high, and the last time I looked they were so unstable that they don't put the actual price on the stamp. Bulk rates are supposed to be supported by the first class rates, but nobody writes letters anymore. I don't think they even teach Palmer handwriting anymore, so letters are a lost art.
But it also noted, "Key USPS expenses continue to grow." The expenses include raises for unionized workers that will add almost $1.1 billion in costs this year.
I have an opinion about government unions. This is a family publication, so I'll bite my lip instead.
As a result, the USPS won't be able to fund its retiree and pension programs as it's required to do. Last year, for example, it paid only $6.7 billion toward those programs instead of the $12.6 billion required.
But they're not paying out at half rate. So where's the difference come from?
Lori Rectanus, a GAO director, put the USPS's actions in context, telling politicians, "Many private-sector companies took far-reaching measures to cut costs when the demand of their central product and services declined."
UPS and Fedex are somehow ticking along. I dunno about DHS and Purolator.
You could cut residential mail delivery from six days a week to every other day, three days a week, and no one would notice the difference. Most of us do our finances electronically, no one writes letters as you said, and I can wait a day to get my
But the USPS, incredibly, has "no new major cost savings initiatives planned." Postal executives say that "statutory, contractual, regulatory and political restrictions" hem the USPS in.
So it's a corporation with no freedom of action because they're micromanaged by the government...
There's no question that there's blame all around. Still, the situation is obviously unsustainable, and the risk is that taxpayers will end up bailing out the Postal Service without getting needed reforms in place. That cannot be allowed to happen.
Expect it to happen.