Created on: February 07, 2013 Last Updated: February 08, 2013
There are few things in life that people can count on these days. As the saying goes, the only thing one can count on now is death and taxes.
There used to be one other group that was always there when one needed them, and that was the United States Postal Service (USPS). "Neither snow, nor rain, nor heat, nor gloom of night, stays these couriers from the swift completion of their appointed rounds," used to be
words that all could live by, but that was before the economy and the Internet drove the USPS to the brink of extinction.
Driven to near bankruptcy by 15 billion in losses in 2012, the Postal Service has been searching for ways to trim some fat. The powers that be are trying to come up with ways to keep the struggling service afloat, but savings have been coming at the cost of postal employee jobs at this point. The USPS sent a plan to Congress that would have closed thousands of Post Office branches to cut into the deficit. Uproar from customers and Congress stopped that plan, instead going for a trimming of services instead.
As the 15 billion dollar total shows (up from 5 billion in 2011), cutting services were not enough. The Postal Service has now been forced into a phase two in trying to cut into their growing deficit.
On February 6, 2013, the embattled USPS announced that when August rolls around this summer, Saturday mail delivery will become a thing of the past. Studies have been done by the Postal Service on delivery levels, and it was determined that Saturday is the lowest volume day of the week right now.
Postmaster General Patrick Donahoe estimated the move would save the Postal Service around $2 billion annually. That would come in the form of one less day of pay for mail carriers while it will also allow the cutting of other positions. Understandably, the Postal Union thinks the move is a horrible idea, saying that Congress should be the group that comes up with a compromise.
One would assume Mr. Donahoe would have agreed with the Union's assessment, but the House of Representatives could not get a bill passed last session to help in this endeavor. Speaker John Boehner noted that it was a serious issue and put the measure back on the agenda, but there is little faith that Congress can accomplish anything for the United States anymore.
There are many that wonder how the USPS got to a point where they are $15 billion in the hole. There are a couple of quick answers to that. First, the change in how people pay their bills is one. Whereas everyone used to write out checks, stamp them and mail, the bills are now handled by automatic bill payment, reducing the amount of mail being handled. The other reason is the Postal Service and its Health Benefits.
According to a USA Today piece, "The agency's biggest problem - and the majority of the red ink in 2012 - was not due to reduced mail flow but rather to mounting mandatory costs for future retiree health benefits, which made up $11.1 billion of the losses. Without that and other related labor expenses, the mail agency sustained an operating loss of $2.4 billion, lower than the previous year".
In other words, taking care of their own, not a reduction of mail handled, is driving the Postal Service into the throws of bankruptcy.
It should be noted that even though mail service will stop on the weekends, package delivery and branch offices will remain open for their normal Saturday hours. That is due to package delivery now being big business, which is something the Post Office cannot afford to give a day's worth of revenue away to other package services like UPS and FedEx.
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