Comments for: How to fix the U.S. Postal Service

Posted Feb. 27, 2012, at 4:49 p.m.

The U.S. Postal Service is neither broken nor bankrupt. Rather, a number of important actions need to be taken to enable this invaluable American institution to be saved as well as revitalized. First, President Obama and Congress need to adopt immediate corrective legislation to ensure that the postal service is …

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  • Anonymous

    Mr. Murphy, why did the postal service build many stand alone offices all over the state in some very remote places which they are now trying to close many of them. Real good thinking here. Many offices were renting spaces in businesses, when they left it hurt the local economy.

  • Thanks go to  Mr Williams and the Independant Governor from Vermont!

    They are the solution.

    The stigma of over funding Mandate goes to Susan Collins and the Republican Party!

    They are the Problem! 

  • Anonymous

     How to fix the Post Office?  Ladies and Gentlemen this is not even hard.  It should be privatized giving the stakeholders a reason to improve products and services.  I will admit the federal government should assume some of the debt, in a o.t.o. payment since it created the mess.

    • Anonymous

      Are you kidding me having stakeholders. There would be areas that will have no service an people will half to drive 20 miles or more to get there mail . The cost on a letter could cost $11.00 or more just to mail a letter in Maine.

      • Anonymous

         All you have to offer is fear and fear itself.  Clearly someone motivated by profit will do a better job at providing the mail than someone motivated by, well, nothing at all.

        • Anonymous

          It’s not fear as you say i went to UPS an showed them a letter i wanted to mail to Portland from Watereville i put it on the scales .first she said i would half to get a large envlope to put it in because there shipping lable will not fit reg envlopes . To send it to Portland would cost $11.35 so dont say im using fear .

        • Anonymous

          For those who say the USPS can’t compete with the private sector. The Postal Service can and does compete. USPS closest competitors, UPS and FedEx, don’t threaten postal business; as two of their biggest customers, they help build it. UPS and FedEx pays USPS to deliver more than 400 million of their ground packages every year in residential areas and on Saturdays. In turn, the USPS contracts with UPS and FedEx for air transportation to take advantage of their comprehensive air networks.

          Although stamp prices have increased about 33 percent over the past 10 years, this increase is in line with inflation. By comparison, private carriers raised their prices by as much as 60 percent between 1999 and 2009. The Postal Service is, and has always been, a bargain.

        • Anonymous

          Someone motivated to make a profit would not deliver to every address across the nation, just ask FedEx and UPS.  The USPS was set up to provide a service to the citizens of the country AT COST.  We are all motivated to provide the best service we can to ensure a comfortable living.  Nobody is getting rich here, and that’s what pro-privatizers can’t stand.  If Congress gave USPS the go ahead to use their network to provide more services and USPS stood up to corporate mailers that hold them over the barrel, we would be well on our way to solvency(well, plus ending the prefunding debacle).  Yoyu should be happy we cannot make a profit, competition with us is the only thing keeping FedEx and UPS prices down.

    • Anonymous

      The Founding Fathers established the Postal Service for a reason.

      Privatizing it is corporate welfare at its worst.

      Susan Collins sponsored the stupid GOP bill that lead to this crisis – tell her to fix it.

      yessah

      • Anonymous

        The founding fathers established the post office because it was not possible, at all, at the time, for a single private entity to provide service. This can be done today. “Corporate Welfare?” What we have now is government welfare to the labor unions. Yes, this so called crisis came about because the grown ups in the room are demanding the post office fund their pensions instead of hoping I, the tax payer, will take care of it in the future. No thank you.

        • Anonymous

          Since when does the taxpayer have to pay our pensions? Both the Csrs and FERS pension funds have a SURPLUS!  We have no problem prefunding our retiree health benefits, but not in such a way that is breaking us.  As the article states, the fund is at a point that it will be fully funded in 21 years just by collecting interest.  The mandate that we prefund for 75 years, for workers that haven’t even been BORN yet, during a devastating recession, is absurd.  The labor unions are not the issue here, Congress need to keep their filthy fingers out of USPS’ pot.

  • The upper ranks are distroying the postal service purposely….in order to make the same amount of wages as the other top ranking executives. They have been trying to get the postal service privaitized for years…..so this is yet another avenue to accomplish it.

  • DEMS HAD 2 YEARS TO FIX THE MANDATE AND DID NOTHING, WHERE IS THE DEM BLAME?

    • Anonymous

      I thin kthe losses they experienced in 2010 shows you where the blame is.  Hopefully, after seeing that republican control is pushing the USPS closer to the edge of insolvency, people will get serious about what is at stake and hold their Congressman’s feet to the fire.  That is, if its not too late.

  • Anonymous

    The U.S. Postal Service ended the first four months of its 2012 fiscal year (Oct. 1 – Jan. 31, 2011) with a net loss of $4.5 billion. Without the requirement to prefund retiree benefits, the net loss would have been a POSITIVE NET GAIN of $105 million. It made a profit last year too, of slightly more, $300 million, although it’s hard to remember hearing anything about it when you take into account for the prefunding requirement.

    Back in 2006, the last time it tried to save the post office, Congress wanted to make sure that there would be plenty of money to pay for the health care of retired postal workers.  The Postal Accountability and Enhancement Act (PAEA) therefore required the Postal Service to pay about $5.6 billion a year over a ten-year period, 2007 through 2016, into a fund to cover retiree health care — for the next 75 years.  That remedy has practically killed the patient.

    The trust fund payments are the cause of the USPS losses since 2006. Without them, the USPS would have been profitable over that time period. All of the current USPS debt is money it has had to borrow from the Treasury so that it can then loan it back to the Treasury for the “trust fund”. It’s a shell game designed to take “off budget” postal revenues, and apply them to an “on budget” trust fund, artificially lowering the federal budget deficit.

    The USPS Inspector General, David C. Williams, said that the fund is in better shape than comparable funds in any other government agency or private-sector business.  “Prefunding retiree healthcare is rare in the public and private sectors,” wrote the Inspector General. “We have been unable to locate any organization, either public or private, that has anything similar to the Postal Service’s required level of prefunding of retiree health benefits.  The Postal Service is currently funded at 49% of its estimated current liability.  The federal government does not prefund its retiree health benefits AT ALL, and the military is funded at a 35% level.  Only 38 percent of Fortune 1000 companies who offer retiree health care benefits prefund the expense at all, and the median funding level for those organizations is 37 percent.”

    Furthermore, Inspector General said the programs are flush with funds. He said the Postal Service has “significantly exceeded” the amount that the federal government and the nation’s most profitable corporations have socked away for pension AND retiree health care. “The USPS has built a war chest of over $326 billion to address its future liabilities.”

    No other company or agency has the same obligation to prefund retiree healthcare benefits.
    Even if one accepts a need for some level of prefunding, the 2006 law was based on assumptions as to volume and workforce levels that no longer apply, yet no adjustments have been made to the payment levels. If the USPS had been allowed to run like a business since 2006 (i.e. without prefunding and Congressmen micro-managing its operations), it would be a profitable enterprise facing the recession with ample cash reserves. Between the “mythical” trust fund with its very real $44.1 billion, and the undisputed $6.9 billion FERS overpayment, the supposedly “insolvent” USPS effectively has almost $51 billion. With this future retiree health benefit account earning 3.5 to 4 percent interest every year, it could be fully funded in the next 21 years without the need for additional funds.

    Republicans refuse to drop the accounting gimmick that places USPS operations “off budget”, while its retirement funds are “on budget” This allows them to cry “BAILOUT” if the USPS asks for some of its own money to be returned to fund its operations. Congress created the “crisis”, not the USPS unions or managers, and Congress needs to correct its mistakes before it destroys the US Postal Service. Don’t blame the salaries of postal workers: their selection by high exam scores, training and accountability, plus good wages and benefits has produced high productivity and a low quit rate. The postal workforce has, in fact, shrunk from nearly 800,000 in 1999 to 550,000 career employees today. Most of those job cuts had to do with increased automation, but many have come at the price of service – despite the post office’s original constitutional mandate.

    Let’s be clear: these short-term accounting efforts will not solve the long-term financial problems facing the U.S. Postal Service.  In order to do that, the Postal Service needs to adopt an entirely new business model which makes it much more entrepreneurial, pro-business, and pro-consumer compared to where it is today. 

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