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Should we shut down the US Postal Service?

Email has destroyed its business model, and even deep cuts in personnel and facilities might not be enough to save it.

By doubleace Aug 12, 2011 1:25PM

This post comes from Lynn Mucken at MSN Money.


Back in May, I declared that the U.S. Post Service, a treasured American delivery vehicle in one form or another since 1775, had outlived its usefulness, a victim of email and its own bloated financial structure. I also wrote:

Another thing that is not going to happen is the prompt and thrifty dissolution of the U.S. Postal Service as we know it. There are just too many jobs -- the Postal Service has 563,000 employees -- and a shrinking but still vocal group of holdouts who insist they do not need a computer.
For them, we will waste years and billions, maybe trillions, of dollars on a barely breathing product.

It was no surprise, then, to see that Congress, apparently not wearied by doing almost nothing to address the national debt problem, has offered two plans to solve the Postal Service's deficit, which is $20 billion over the past four years, including $8.5 billion in the past fiscal year. The bipartisan plan kicks the can down the road for future elected officials to worry about. The conservative plan would solve the problem by, among other things, repainting the trucks.


What was surprising was the proposal put forth by the Postal Service brass themselves: cut jobs, close post offices and withdraw from the federal health care and pension programs that they say do not meet "the private-sector comparability standard." 


This is no small stuff.


According to The Washington Post, citing a notice sent to employees, the Postal Service wants to cut its current work force of 563,000 by 220,000 over the next four years. About 100,000 cuts would come from attrition, the rest by elimination.

Post continues after video. 

In addition to its earlier announcement that it would like to close 3,700 post offices, the Postal Service wants to eliminate most Saturday mail service; take all of its current workers and 600,000 retirees out of the Federal Employees Health Benefits Program and put them into a cheaper plan run by the Postal Service itself; and forgo required prepayments -- $5.4 billion this year alone -- into its employee retirement plan. 


Much of this would need congressional approval and would require the breaking of labor agreements -- not easy tasks. "The APWU will vehemently oppose any attempt to destroy the collective bargaining rights of postal employees or tamper with our recently negotiated contract -- whether by postal management or members of Congress," American Postal Workers Union President Cliff Guffey told The Washington Post.

Then there is the problem of public opinion. No one wants his or her post office closed. Here's what Daniel Deagler, writing on the Philadelphia Inquirer's website, had to say:

Last month, Postmaster General Patrick Donahoe announced that the agency was looking into closing up to about 3,600 post offices. If the Postal Service were a business, there would be no question that many of them should be shuttered.
But that's the thing: It's no more a business than the State Department or Department of Agriculture. Is the Navy expected to be financially self-sufficient? Is your local police department? Of course not. Taxes pay for government services, and mail delivery is a government service. …
This country has 3.79 million square miles, and in pretty much every one of them, the post office delivers six days a week. The 31,900 or so post offices create the network that binds the country together. Most are in small towns, and it is true that they don't bring in much cash. But they are the hubs of their communities, the place where the flag proudly flies. Quite often, it is the post office that make the town a town, and the people who live there think they're worth keeping open.
Every year, the U.S. government gives more than $30 billion in aid to foreign countries and $4 billion in subsidies to oil companies. Why shouldn't it give the U.S. Postal Service a few bucks to keep the post offices open in these American towns?

The Postal Service, chartered in 1971 as a self-supporting organization, is not a government department in the sense that State and Agriculture are, but Deagler has a point: Is financing your local post office -- 17 in the Bronx alone are targeted for closing -- something taxpayers should take on?


No, insists Doug Mataconis of Outside the Beltway:

USPS not only finds it difficult to react to changes in the market because of the political implications of the decisions that it makes, but it has no incentive to do so until it's absolutely too late, like it is now.
Consumers have found a way around that monopoly by essentially voting with their feet. Electronic payments mean that fewer people mail checks anymore. E-mail, Facebook, and Twitter mean that you don't need to send a letter or a card to stay in touch with friends and family. The World Wide Web, and now tablet computing, have made paper magazines somewhat obsolete. At this point, the USPS's first-class mail system is little more than a vast junk mail delivery system. …
Privatizing the Post Office won't prevent the changes in technology that are making mail delivery less relevant but they would allow USPS, or its successor, to respond more rapidly, and more creatively to those changes without having to please the political overlords on Capitol Hill. Privatize the mail; it may be the only way to save it.

While keeping in mind that, even with the personnel cuts proposed by the Postal Service itself, privatization would still leave 343,000 middle-class employees looking for work in a job-scarce economy, not to mention the ripple effect, I believe shutting down is long-term smart.

  • Two highly developed and efficient private, well-paying package-delivery companies -- UPS and FedEx -- would pick up many of the people cut by the Postal Service.
  • Junk mail would still find its way into our homes. It is too big a business to just disappear. And while most Americans appear to detest it, volume alone indicates it must be effective as a business tool. Someone would step in to fill that gap, but maybe not at 14 cents per piece. 
  • First-class letters (the 44-cent kind) would disappear. What documents and personal correspondence that must be hand-delivered could be done by courier services or the big delivery boys -- though at a higher cost, much like newspaper delivery.

More on MSN Money:

Aug 12, 2011 2:43PM
Can we also shut down the U.S. Congress while we are at it??? 
Aug 12, 2011 2:19PM
They could eliminate the BLOATED management & save all they need.
Aug 12, 2011 3:28PM
Doesn't anybody on here know that the Post Office does not use tax money.? All their money for wages come from the stamps you buy, and that has been in effect since 1970. The reason they are in debt is that someone made a mistake on how much they have to pay the government for retiree's health benefits which comes to about 4 billion dollars too much a year and our great congress will not change it, that is why they are in the hole, not from not making enough money through stamps.As for unions they gave you workmen's compensation, sick days, unemployment compensation, 8 hour work day, overtime for time and a half.and.freedom from harrassment. They know that  management would give you 10 cents an hour and no benefits , why do you think the union came into being, because of management's overbearing nastiness.
Aug 12, 2011 5:57PM
Why did the reporter not tell the whole story?  Why didn't they tell that the government has made the post office pay 81.9 billion dollars more to the pension fund than it owed?  Why didn't they tell that congress is holding a bill hostage in committee that would require them to let the postal service have access to that money?  Why didn't the reporter tell that congress is making the post office prepay health benefits for 50 years of future retiree worth benefits?  Why didn't they tell that every postal employee hired from 1984 on is in Social Security not Civil Service.  That's right, it is not paying a sizable pension for a large percentage of it's employees.'  Why do they always attack the post office without telling the whole truth?  By the way, UPS only delivers what it wants too, and where it wants too.  This reporter did not tell that every weekday,  UPS trucks drop off shipments of parcels that UPS wants the post office to deliver.  Why didn't they point out that UPS does not having shipping, and pickup centers in most cities?  Is it irresponsible reporting or is the reporter just flat dumb?.
Aug 12, 2011 3:28PM
Just for your information, a lot of people don't have computers, don't have internet, and depend on the post office.  Just because you don't, please don't be so damn selfish to deny communication to others!!
Aug 12, 2011 2:28PM
Charge the same or a higher rate for junk mail they do for regular mail. That would erode the system completely over the next few years.  For a system that is going broke they deliver a dozen catalogs a week to my address.
Aug 12, 2011 3:43PM
Instead of closing down the post office, perhaps we should look at the congress.  Each and ever member, having served just one term receives a lifetime of full pensions and lifetime benefits better known as congressional benefits.  If you start crunching numbers, that would save us taxpayers millions annually.  No place like home to start trimming the fat off of a bloated system.

I think it's amusing that no one ever looks at how congress takes care of themselves for the rest of their lives but feel they need to cut spending everywhere else.

Until they get their act together we as a country are going to be screwed!

Aug 12, 2011 7:30PM

I'm a postal employee so let me give you the inside TRUTH that no one is talking about. There is only ONE problem for the Post Office. The fact that we have to pre-fund our retiree health benefits for every employee the first day they walk in the door to work. We have to pay 5.5 BILLION dollars a year to do this. We are the only government agency that is required to do this yet we are the only government agency the DOES NOT TAKE ONE SINGLE DIME OF TAXPAYER MONEY! We would have turned a PROFIT if it not for this UNFAIR pre-funding issue laid upon the U.S.P.S. as a last minute tag in a bill by passed by congress during the  W. Bush administration. We have taken our efficiency to task and are getting leaner by the day. As mail volume falls we consolodate routes and cut jobs through attrition. This DOES NOT CAUSE OVERTIME. We are not asking for a "bailout". We just want this unneceesary pre-funding obligation eliminated. Unfortunately opportunists are using the USPS as a political football seeking us to be stripped of our collective bargaining rights or (as the writer suggests) eliminating us completely. Let it be known the USPS is an example of how GOVERNMENT CAN ACTUALLY BE EFFICIENT. Eliminate the pre-funding and we can continue to deliver 6 days a week to every physical address in the U.S. for 44 cents (we have not had a revenue increase in 3 years even though costs have skyrocketed). We will do this and TURN A PROFIT! And actuallty continue to employ all our people without laying off or having to have givebacks in our union contracts. Remember over a quarter of Postal Employees are veterans and we are all Americans who are proud of our country no matter how much people want to kick dirt on us.

Aug 12, 2011 5:49PM
Why shut them down?
I think they should do just like this part of the article says...
Every year, the U.S. government gives more than $30 billion in aid to foreign countries and $4 billion in subsidies to oil companies. Why shouldn't it give the U.S. Postal Service a few bucks to keep the post offices open in these American towns?

Aug 12, 2011 3:42PM

And how will we sent packages to our military overseas? My husband is "over there" and cherishes the packages he receives from home. I always use the USPS because they are the nicest people ever. They come out to help me carry my many packages, hold doors and are polite and respectful. Obviously, this is where another GAP in civilian and military life exists. I live in TX and every post office I go to is clean and helpful. He receives his packages in 7 days! I don't have to pay for a box and I don't pay an arm and a leg to ship to my family. They are the ONLY service that delivers, inexpensively, to APO/FPO duty stations. Craziness.


USPS is also one of the few businesses that hire military retirees. My mailman is polite, rings the doorbell and hands me my package, uncrushed, addresses me by my name and tells me to have a nice day. Unlike UPS and FEDEX, where the boxes are crushed, falling apart and I've had to return damaged items when they deliver ding dong ditch 'em style.

Aug 14, 2011 4:10PM
I am a retired postal and USAF employee.  My golden parachute after 23 years of service is $800 a month and no medical insurance.  Because of mine and my husbands age I did keep the Life Ins. which I pay for.  The reason the post office is in trouble is because they will not allow the post office make the decisions it needs to run as a business.  They know they will not be able to get their hands in the cookie jar.  And how can they run a profit when they have to prefund the retiree benefits in advance at a cost of 5+ billion per year?  I do agree that the top managers could be trimmed quite a bit.  As for Social Security I do not consider my 48 years of contributions to be considered an entitlement.  If that is the what you call it give us back our deductions and let us make our own retirement decisions.  Just my rant.
Aug 12, 2011 5:57PM

From a retiree of the postal service:


One of things the postal service does is forward mail free (first class) for a year and magazines for 60 days.  Getting your mail forwarded would be impossible if there were private companies handling your mail.  And, who would want just anybody handling one of your most private things, mail.  Now, only the postal service has access to your mail box, do you want to let just any delivery company open your mailbox?  I know that I would not.  There is a way to keep the postal service around for a few more years if congress would get their noses out of it.  When people that are 30 now are 60+ maybe everyone will be computer literate and not need mail, but now it is still a vital service to the country.

Aug 12, 2011 3:38PM

I'm with Kassemd -  Until EVERY home and business in the country has quality internet service avalible to them at an inexpensive price we need the USPS.  I'm no Wilma Flintstone, but not everyone has access to a home computer.

Aug 12, 2011 2:38PM

When I can send a package through e-mail then start thinking about closing the USPS. I cant afford to ship with UPS

Aug 12, 2011 6:14PM
If you shut down the USPS then answer this question. I served in Iraq and better part of southwest Asia and the ONLY way that myself and my Soldiers could receive any kind of care packages, letters etc. was through the USPS. Having operated the post offices throughout the theater I know first hand how much our military overseas looks forward to receiving and sending packages and what not to and from. Take this away and you do an injustice to the ones who defend the very freedom that we all enjoy everyday.
Aug 12, 2011 10:02PM

It will not be time to shut down the postal service anytime soon.  Not everyone has access to the internet.  Are we going to give everyone in the ghetto a free iPhone and free service for that phone?  If we don't, how will they get their electric bill?  Oh, I forgot.  People in the ghetto don't need electricity anyway.  What about farmer Jones in rural North Dakota who has no internet service within 20 miles?  How will he get a letter from his son in the Army serving somewhere in the middle east?  How will that brave soldier get a letter from home to cheer him up after a long battle.  What about me?  What if I can't afford to keep my internet service?  How will I get my utility bills?  How will I pay my utility bills?  What if my computer breaks down?  The list goes on and on.  The bottom line is this:  We still need the Postal Service, and will for many years to come.

Aug 12, 2011 3:21PM
Basically the only valid point that this article makes against the USPS is that many people use facebook / twitter / online banking etc. type sites instead of going the 'old' route, which would be using the mail. However, the internet is incredibly unreliable and insecure - millions of people have suffered from Identity theft because they put all their information on the wrong sites. The internet has become a one stop shop for criminals and many American citizens (even those who know how to check a site's credibility) do not feel safe leaving their info on the WWW for anyone to gain access to. Many would still prefer a paper/hard copy of their spending habits, bills, or even a nice hand written letter. The writers in this article are telling us to put our faith in 21st century knowledge and rely on the internet, but it is because of the internet and our smartphones that claim to make things so much simplier that we see higher stress rates and a significant decrease in literacy among high school and college students who grew up using text./internet 'lingo.' By telling us to depend solely on our technology the value of our citizens will continue to decline, our country will see a significant loss of jobs, an increase in our poverty and crime rates, and more domino effect of a downward spiral. Good luck!
Aug 12, 2011 6:05PM
I have worked for the postal service for 20 years. I laugh at some of the ignorant comments made by people who have never even been employed by th USPS. There are many ways to save money and cut back on labor costs, The people making the decisions are the ones who make the most money and couldn't do one hour of delivering on the streets. From an insiders view, all one needs is common sense and the balls to right the wrong. I am a union member and have over time become opposed to most of the union rules that would be the first place i started. Do you know how many people are sitting home collecting comp? 30,000 plus. Do you know how many carriers take 8 hours to do a 6 hours worth of work.?  4 out of ten. How many people with high level jobs, making 6 figures do absolutely nothing for 8 months out of the year? 80% Start at the top and trickle your way down to the people who keep this business running. Change the way delivery is done on the street, move the mailboxes for easier delivery saving time and lose the 3 supervisors per unit> SHHessh I could go on forever. Many of us do our job well and take pride in the fact that we do The ignorance on both the public side and the congressional side is just so irritating
Aug 12, 2011 10:58PM

I have made a few posts, and this will be the last. What I want to do is to appeal to the conservatives, independents, and Tea Party supporters, as this debate sometime sounds political, but the PO is not a political organization. If you love your country, and I know you do, you will understand this.

We live in heavy times, and not all things that say "United States" on them are bad. The PO is one of the last things that says "US" on it that truly belongs to all of us, and it helps to insure the freedom of our people as individuals and our most private communications. It is not a business exactly, but it can operate as one if Congress got out of it's way. Many are under the impression that because the PO is losing 8B dollars a year that it makes no money. Not true. It took in 67B of business this last fiscal year. So it can indeed be a money maker.

The reason it is not allowed to profit and reinvest in itself is because many years ago some did scream "monopoly" and thought the private sector could do more for less and more efficiently. But it could not, cannot, and will not. FedEx and UPS and others wanted a piece of the market and a chance to compete, and they got it. But they don't provide the "service" to the American people the USPS does. They can't for what the PO charges us, and they in fact uses the PO for deliveries. FEDEX "Smart Post" parcels? Those arrive via the PO.

I am asking the fiscally conservative and Tea Party people to simply ask Congress to let the PO compete freely in the marketplace as a business, but with the protections of the U.S. government behind it to insure it continues to serve the nation. Call your Congressman and let them know you want the USPS to survive as a resource of "the people" and let it be free of these obligations and restrictions that are causing it to lose money.

Listen, it can make money, but even if it couldn't.....of ALL things that say "United States" on it, it might be one of the top 3 worth saving and having as a working institution which serves the public.

Consider something very bad happening. I keep reading of Government control, liberties taken from us, and threats from other nations. Do YOU believe it can become reality? Do YOU believe we can one day be without electricity, money, food, water, and shelter? Do you believe a bomb can drop and foriegn invaders can storm our beaches? Sure, it's possible. In those times do you think a United States Postal Service with a willing, brave, and capable workforce with infrastructure which guarantees your documents, money, information, and even critical information of what is happening on your side of town and country arrives safely and privately at your destination is worth protecting? Heck guys, I do. And if that time ever comes I will risk my own life to grab a SEALED and private communication from a fellow American and deliver it to another and proudly say "at your service." The Pony Express used to carry arms with them. It may have to once again. Implausible? Maybe. But certainly possible. And if that day ever internet, no gas, no food, death at my door...I want someone to pick up my mail and say "at YOUR service" and deliver my letters unopened and unmolested to where they need to go. With no other motive then a call to duty and the relentless idea that the mail must go through.

The USPS is not a wasteful government agency. It is in fact one of the few which serves us all equally and truly gives us what we pay for. And indeed one day not far from now our very freedom might rely on it, and those who are willing to serve.

Sound far fetched? Not really. And 67B in revenue this past year would say it is viable. Don't support closing down the USPS, simply tell the Government many consider "too big" to butt out and return it to "the people" where it belongs.

It is far more important then many might think. Let the flag fly high over it...and proudly say "THIS IS MINE!!"

Aug 12, 2011 8:13PM
I am very proud to say that I am a US Postal Service worker. I have had several positions since the start of my final career with the PO in 1996. We are a great organization, and try very hard everyday to serve every customer in the US with the best service possible. I spent the first 20 years of my life working in another field of business, and I am thankful everyday that I work for such an historical organization. It is a wonderful job, and, No-we are not overpaid for what we do, and anyone that thinks so is an A-hole. You have absolutely no idea what we have to put up with. I, myself had no idea what was involved in getting the mail delivered and serving the customers until I started working for the USPS. It is quite an involved operation, and the problem is that there is so much micro-managing, and bad management decisions by a lot (most of) of upper management that has cost us alot. Bonuses are given to people that don't even do the work, and the workers are the ones who are being punished. Us poor slob workers are put under sooo much stress, and have to work short-handed, and are still required to serve the US people with the same effiency. With the cutting of positions and closing of post offices, how can that happen? Well, that's a no-brainer, it can't. The PO needs to get rid of the people holding management positions that just look at numbers and have no clue as to what it takes to SERVE the public. I also think that a postal worker should be regarded as to the kind of worker they are, whether good or bad, not by just a number or their seniority, when it is decided to abolish their position. If the PO would only judge their employees by their  worth and what they contribute to serve the people, there would be no problem in reducing the roles. I can truly say that I am a Good worker, and put up with a lot of ****, and I don't complain, but it pisses me off to see so many workers that are worth ****, but because of their seniority or that they are ex-military, they have more of a chance of keeping their job than I do. A very sad situation!!!!! I am all for the military and what they have done, and still do, but when I see them using this as a reason to still keep this job, and be a shitty worker that does not care about what they do, it makes me sick!!! I say, get rid of all the dead-weight, whether it be in management or whatever position they hold!!!!! I also wish the APWU in Florida was stronger, I close my mouth to so many contract violations these days because I want to keep my job. Since I am the only person working in my family due to my husband's medical condition, I feel the need to keep my mouth shut, and put up with all the ****!!!! LONG LIVE THE US POSTAL SERVICE!!!!!!!!!!!
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