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Saturday letter delivery an expensive luxury
Americans are notably sentimental about the Postal Service. For many, their letter carrier or clerk at the local post office is the only federal-government employee with whom they are in regular contact.
The U.S. Postal Service has powerful unions, and Congress, although disinclined to pay for it, is enormously protective of the service, not least because there are post offices in every federal district, many of them named after the local member of Congress.
Unfortunately, the post office is in poor and worsening financial shape, losing $15.9 billion in the last budget year alone.
The Washington Post’s government-watchdog column, the Federal Diary, says, “The U.S. Postal Service is neck deep in debt, it has defaulted on Treasury payments and its business is in free fall.” First-class mail, its most profitable service, has fallen by 37 percent since 2007, largely because people use the Internet to communicate and pay bills.
In a daring move to cut costs, Postmaster General Patrick Donahoe this week announced that the service plans to end Saturday pickup and delivery of letters, although letter carriers will continue to deliver packages, one of the few growth areas for the USPS, and priority and express mail, but no magazines, newspapers, catalogs or Netflix. (Netflix believes its customers will switch from DVDs to streaming video in any case, a sample of the business problems the Postal Service contends with.)
The Postal Service plans to switch to Monday-through-Friday delivery in early August. The cutback is expected to save $2 billion a year, which Donahoe called “too big of a cost savings to ignore.”
The move is daring because Congress has expressly required six-day delivery since 1981, but that requirement was somehow omitted from a stopgap resolution last fall temporarily funding government operations through March 27.
Congress could reinstate the requirement, but Donahoe is betting that by then the public will have grown used to the idea and that lawmakers, prone to burdening the Postal Service with mandates they don’t pay for, will see the virtues of the savings.
Congress gives a lot of lip service to running government agencies “like a business.” Here’s its chance to support an entity that is actually trying.
Discussion | 5 comments
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PatriotFebruary 08, 2013 - 5:48 am
Wow, congrats on this move. You will only be in the red $13.0 billion in 2013..This is an example of a typical government program that has high power lobbyists in Washington..Again if a normal business it would be out of business years ago..Good going Congress. Keep up the good work!!
Reply |Danny BuntinFebruary 08, 2013 - 8:02 am
A normal business would not be required to fund its pensions 75 years in advance(10 year span). Lets see how broke you are, if I make you pay for 10 houses for your offspring of three generations in the next ten years. Name one business that has to fund pensions like this. The private sector gets to put off pension funding, while they funnel away the money before a planned restructuring. This is a great way to make the post office look bad - falsely. Red meat for the ill informed.
Reply |Mr. PracticalFebruary 08, 2013 - 8:24 am
Danny hit the nail on the head. This article explains the situation well. http://www.washingtonpost.com/blogs/federal-eye/post/postal-service-federal-pension-contributions-105-percent-overfunded/2012/06/25/gJQAXrva2V_blog.html... Postmaster General Donahoe has a plan that will help return the USPS to profitability but Congress doesn't seem to care.
Reply |CD BrooksFebruary 08, 2013 - 7:29 am
I'm surprised they waited this long, because this is not "new news." I personally don't have a problem with no Saturday delivery. But if it absolutely, positively has to be there overnight? Well it's just going to cost a little more!
Reply |Mr. PracticalFebruary 08, 2013 - 2:06 pm
Danny hit the nail on the head. In addition, there was a large (something like $8 billion) that was overpaid into the fund. It literally takes an act of Congress to get it back. Congress has refused to act. My guess is, Congress is going to shoot down this cost-saving measure. It makes too much sense.
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