Is the US Postal Service Near an End … Another Casualty of Unions


“Neither snow nor rain nor heat nor gloom of night stays these couriers from the swift completion of their appointed rounds” … but federal bureaucracy and Unions could certainly put an end to the US Postal Service.

The US Postal Service is near default and bankruptcy and because of decades of contractual promises made to unionized workers, including no-layoff clauses that  are increasing the post office’s costs. Who runs a business like this? The Postal Service has been a colossal disaster for years.  Add to this the fact that Postal workers receive better benefits than other federal workers. Why? The US Postal Service should not be bailed out by Congress unless they are made to do many cost containing measures like reducing services, laying off unnecessary workers, and closing locations.

The United States Postal Service has long lived on the financial edge, but it has never been as close to the precipice as it is today: the agency is so low on cash that it will not be able to make a $5.5 billion payment due this month and may have to shut down entirely this winter unless Congress takes emergency action to stabilize its finances.

“Our situation is extremely serious,” the postmaster general, Patrick R. Donahoe, said in an interview. “If Congress doesn’t act, we will default.”

In recent weeks, Mr. Donahoe has been pushing a series of painful cost-cutting measures to erase the agency’s deficit, which will reach $9.2 billion this fiscal year. They include eliminating Saturday mail delivery, closing up to 3,700 postal locations and laying off 120,000 workers — nearly one-fifth of the agency’s work force — despite a no-layoffs clause in the unions’ contracts.

The Astute Blogger has further commentary on the reasons why the US Postal Service is about to go belly up. The US Postal Service is a dinosaur and must either adapt to today’s high tech environment or go the way of the Dodo.   We cannot continue to have a government subsidized entity like the PO when private enterprise could handle it for much less. The American Thinker is correct, the USPS has been the model of inefficiency. They are the poster child of a failed business model. It does not matter how many times they increase the cost of stamps or receive government bail outs, they continually will ask for more. The days of past union contracts are over. Make this into a quasi business, sell off certain aspects of the business, for God sakes do something that makes it not such a burden on American tax payers.

Look for a gigantic tax payer bailout with little change to the union contract. Senate Dems would filibuster any tampering with the contract so it will almost certainly survive with a few cosmetic changes.

And 5 years down the road – maybe sooner – we’ll be asked to bail them out again.

EXIT QUESTION: Who really used to USPS these days? In the age of the Internet and on-line banking, does anyone really get snail mail? Mostly junk mail is sent through the US mail which in the Internet world would be considered spam.

Posted September 5, 2011 by
Business, Economy, Government, Jobs, USPS, WTF | 6 comments

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  • Comments

    6 Responses to “Is the US Postal Service Near an End … Another Casualty of Unions”

    1. katts on September 5th, 2011 12:04 pm

      Reality is for all your important sounding economic big talk:

      The real deal is that private enterprise salivates at the thought of gaining the USPS DINOSAUR’S market share of internet business. What a financial coup! We can now call India for shipping instructions and lay-off more American workers, many ex-military.

      As for private enterprise’s efficiency and cost cutting, check the shipping costs of a small package sent by FedEx and UPS, and CHOKE folks.
      As a novice, try using their online shipping sites, a modern Rubik’s cube by which THE DINOSAUR pales.

      For an online shipping account one requires an attached momentary account/credit card which can be back charged for miscalculated weights. Their scales reign.

      We subsidize how many foreign countries, but it’s now uncool to provide for our own, not the inspired cutting edge, global thinking of the free markets, which rewards us with jobs to Mexico, India and China.

      Unwarranted subsidies a worry, let’s strip the benefits of our lackey congressmen who couldn’t/wouldn’t deliver a package on their best day, a more reasonable choice in budgetary restraint.

    2. katts on September 5th, 2011 12:27 pm

      My business friends use the USPS DINOSAUR for receiving and sending foreign and domestic “snail mail.” With rare exception they say it’s been affordable, safe, and reliable, i.e. efficient.

      As for the pejorative term “snail mail, most internet sales technically falls under that category in that packages require human delivery be it FedEx or UPS. Only the money, the financial information, flies through cyberspace.

    3. SJ Reidhead on September 5th, 2011 4:22 pm

      It is terribly arrogant to ask “who really gets snail mail these days. My parents do. They don’t have a computer. My cousin who is in basic training at Ft. Benning is only allowed to communicate with his parents by snail mail. Just how many elderly people are wired for all the latest tech devices? VERY FEW OF THEM!

      The USPS is a mess, but the worst thing the far right tea party people (of which I am not one) will do is force the destruction of the USPS. Want to destroy the GOP? If the extreme right continues on their current course, we’re going to be cursed with liberal Dems for many many years.

      I agree with the first comment. If the USPS is disbanded, we’re going to have a mess. I use the USPS to ship almost everything because it is cheaper and more efficient. UPS costs a fortune. FED EX is unreliable if you live in the middle of nowhere.

      Then there are all those packages that are alleged to be delivered by the private sector. If you live in rural New Mexico, FED EX and UPS often drops the packages off at the rural post offices, which are slated to be closed.

      You think the tea parties have cause an uproar? Try destroying the US Mail to appease the libertarian over-lords. It’s not going to be pretty. Perhaps a little less far right arrogance and a little more awareness of what is really going on in the country might help things. My rural post office is on the chopping block. The flurry of activity to save it is amazing. People in rural, fly-over America – the normal people who aren’t holding pithy little tea party signs – are being marginalized, yet once again.

      I think perhaps the far right extremes had best begin fearing those of us who are normal Republicans, real, rational individuals. We’re getting angrier by the day.

      The Pink Flamingo
      SM: Its not arrogant to ask. There are many services that have gone away because they are out dated. Actually its pretty arrogant and presumptuous on your party to say that the Tea Party is to blame for the Post Office going away.

      This is a business issue, not a Extreme Right issue. The PO is a failed business model and something needs to be done about it. It cannot continue the way that it is. However, when you have union deals that say there can be no layoffs, that’s BS!


      Far Right extremists? The USPC is going bankrupt because of ridiculous union perks. Postal workers get better benefits than other fed employees. Why? I believe that anyone in the military who defends their country should get the best perks, not some overpaid, lazy postal worker. Personally, I think it serves some purpose, but not what it used to. The size of the Post Office bureaucracy and the number of locations needs to be shrunk big time. If the US govt can do it to military bases, they most certainly can with post offices.

      The Internet has nearly made PO’s irrelevant and there will come a day when everyone does have internet access. if you have a telephone, you have access to the Internet in one form or another.

    4. Scared Monkeys on September 5th, 2011 4:54 pm

      #1 & #3,

      Just like many things, the PO will either have to adapt, be reduced or be swallowed up. Even if the PO does not go away, the services that they once provided will be no longer.

      They are already talking about doing away with Saturday delivery. Look for other days to go away as well.

      The USPS needs to lay off excess employees and redo the union benefits package. America can no longer afford these out of control wastes. Also, the Post Master General’s salary needs to be cut in half.

      I would dare say that if they are going to break even, then stamps and their delivery rates are going to have to be increased and most likely, their delivery to rural areas will be cut in half if not once a week.

      Some thing has to be done to fix this, Congress cannot just keep throwing money at a broken process.

    5. katts on September 6th, 2011 12:43 am

      @ R
      Yes, I can agree the PO needs to be streamlined, but done away with, obsolete, hardly. If you think FedEx and UPS are the way for the masses, I think not. Good for some businesses, but too complicated and expensive.

      As for internet/computer usage you would be shocked at how many educated people do not have the skill, or simply will not use a computer as they detest, hate “gadgets”. You take much for granted. I doubt these educated, tax paying voters would take kindly to a force fit or suffer in silence.

      Besides, even the naive know their every move is tracked when using the internet, as in this conversation, stored and tracked.

      Let me restate: This financial debacle/scare certainly has some merit, but is more likely about some private shipping contractor jockeying for the US internet business, a huge financial coup. Governmental BS ex: Debt ceiling debate: SSA checks may be delayed, Oh worry, worry. Go ahead and delay dim wits, as the Arab Spring turns into the American Senior Summer, and rightly so. Congress assuredly knew if delay was implemented civil unrest would likely ensue along with a greater concern, their unemployment, but even so perpetrated a cruel hoax in scaring the elderly.

      Again, Congress (All) seems perfectly thrilled to throw money at problems, namely themselves, the producers of nothing.
      Cut their benefits first
      SM: You & I agree on more than we disagree. You will get no argument out of me about cutting Congresses benefits first. In fact, they should be term limited so that there in no pension or benefit plans. The Founding Father’s never intended for Rep or Senate positions to be full time, life long positions.

      As for you saying that UPS/FEDEX would be too expensive. If the PO actually charged the going rate to balance their books, let alone lay off half their work force, you would find that the PO would be more expensive than either FEDEX or UPS.

      To show how pathetic the govt is and their lack of planning ahead … wouldn’t you think that the PO of all places would have foreseen email as the future and got in on the ground floor?

      However, just like pretty much every govt entity, they were asleep at the wheel. Obviously the future and not too distant at that is going to have to account for technology to reduce prices. It is going to become so expensive to use the PO that people will move to the Internet. Also, I will go a step further … why are politicians needed all the time in DC? They could easily use Skype, video conferencing, etc. The do-nothings do not have to be in DC, they need to be back home dealing with their constituents. Their votes can be done over the Internet. If the govt can put our medical records on-line, they can certainly use the Internet to vote.

      There are many ways that the govt can change their habits, they just care not to.

      Also, fort Dems, GOP or Indies, Air Force One should no longer be paid for by tax payers for political campaigning, ie like this weekend when Obama was shipped off to Detroit for nothing more than a campaign speech.

    6. Wolfgang on September 6th, 2011 4:26 pm

      If I remember correctly, the postal service bought some million dollar houses for some of their TOP folks and then lost money on them when time to sell because of the real estate market being down….about half of what they put into them actually.

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