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You've probably heard that the US Postal Service is going broke. Well, you may ask yourself why is the Postal Service going broke is. They keep raising the price frequently, & closing post office to keep their budget balance and now talking about no Saturday delivery of mail. Closing the post office on Saturday will only save about $2 Billion a year, and the postal service reported $16 Billion loss in 2012. Some say the mail volume is falling because of the internet; many people are going online to a pay bill & they are using email rather than sending a letter. Also the economy had been in a downturn which adds to the problem. But real problem is the Congressional mandate for prefunding
Did you know that the post office is the only government agency that does not rely on any government assistance or taxpayer’s money to keep it running? However, part of it operations including health & retiree benefits are part of the federal budget. The Postal Service accounts for 7.7% of the GDP. And they would have posted a $100 million profit.
The post office has a massive job delivering mail to every door in the USA, it delivers to 151 million homes, businesses and P.O. boxes and it does it very well. You can’t compare them to UPS/FedEx or any other carrier because other courier services don’t deliver to ever door; and the cost for such service is much higher. The post office is also the largest civilian employer of minorities, women, & veterans & they have the largest union.
The postal service was doing well until 2006, this is when Congress decided that the 235 year old Postal Service needed to make annual prefunding payments to a special fund, funding 75 years worth of future retiree health benefits in 10 years; this is something no private business could afford. So far they have paid $21 Billion into this fund. Without that Congressional mandate, the post office would still likely be struggling like most of us, but it would have a lot more wiggle room and more cash. Currently its pension obligations are overfunded by $11 Billion. The prefunding requirement make no sense, no other government agency has to do it.
So why is the Postal Service required to prefunding future retiree health benefits for people who are not even born yet? Some say the Congress is intentionally trying to bankrupt the Postal Service so that it can be sold & become a private company. Private equity companies, like Bain Capital, can take over and make it profitable again. Possibly destroying the low postal rate we now enjoy. However that option of making the Postal Service comes with a price.
If you listen to congressional rhetoric, you would think cutting services and a taxpayer bailout are the only options. This is not the truth. For the postal service to survive lawmakers will have to let its officials manage operations autonomously, or provide money with which to meet Congress' mandates. Congress can also pass new laws that will revitalize the Postal Service so that they can take advantage of the digital age & offer new services to the public as they have done over the past 235 years.
Here is what you can do to help the Postal Service balance it budget so that we will not have to bail out the Postal Service in a few years.
Call or email your US Senator and House Representatives to co-sponsor a pair of postal reform bills that were introduced in the House and Senate on Feb. 13. The Senate bill (S. 316) was introduced by Sen. Bernie Sanders (I-VT) with eight co-sponsors; the House bill (H.R. 630) was introduced by Rep. Pete DeFazio (D-OR).
This is the Bill that is currently in the Senate that will help the Postal Service:
[113rd] S.316 : A bill to recalculate and restore retirement annuity obligations of the United States Postal Service, to eliminate the requirement that the United States Postal Service prefund the Postal Service Retiree Health Benefits Fund, to place restrictions on the closure of postal facilities, to create incentives for innovation for the United States Postal Service, to maintain levels of postal service, and for other purposes.
Please contact you US Senator for their support of this bill.
You can track & follow this bill here to see when or if it leaves the Committee on Homeland Security and Governmental Affairs.
In the House:
H.R.630: Postal Service Protection Act of 2013 is currently in the House Oversight and Government Reform & the House Committee on the Judiciary. There are currently no Cosponsors for this bill in the House.
Check out Sen. Bernie Sanders one of the few Senators that make sense. Check out his videos on Youtube