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Obama budget backs end of Saturday mail

The president's budget plan would give the US Postal Service the option to end Saturday mail delivery next year.

By MSN Money Partner Feb 13, 2012 4:39PM

This post comes from Eric Morath at partner siteThe Wall Street Journal.

 

Mail delivery would be cut to five days a week under a proposal from President Barack Obama to save the U.S. Postal Service $25 billion over the next 11 years.

 

The president's budget plan, released Monday, would give the Postal Service the authority to end Saturday delivery in 2013. The agency has proposed that change for several years, but Congress, which would have to approve the change, has so far resisted the move.

 

The postal system is supposed to operate without taxpayer dollars, but it has been bleeding cash in recent years, forcing the agency to borrow billions from the Treasury Department. Last week, the Postal Service said it lost $3.3 billion from October through December 2011, normally the agency's most profitable time of year.

 

Obama's proposal also backs several other changes sought under the postmaster general's cost-savings plan, including the return of $10.9 billion in overpayments to the federal retiree system and an easing of rules requiring retiree health care costs to be pre-funded.

 

Currently, the Postal Service must set aside more than $5 billion per year for retiree health care. Without those obligations, the agency would have been nearly profitable last quarter. Post continues below.

The president's plan, if it were approved, would allow the Postal Service to pay for retiree health care on an accruing cost basis, in line with how other federal agencies meet those obligations. Obama's plan would also give the Postal Service more leeway to increase postage rates.

 

The proposed changes would provide the agency with billions in cash relief over the next two years. The Postal Service said last week that without changes it could run out of cash as soon as October.

 

Obama's budget plan, released Monday, serves as both an outline of his re-election campaign message and a blueprint of the White House strategy for another fiscal clash looming after the November elections.

 

More on The Wall Street Journal and MSN Money:

63Comments
Feb 13, 2012 7:23PM
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How about "ending" all the overpaid bureaucrats rather than Saturday delivery?
Feb 13, 2012 5:15PM
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Funny how they'll cut the PO back to make it work, but federal pay is off limits?????? Is there something missing here?
Feb 13, 2012 7:30PM
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That is the dumbest thing i have ever heard! No business saves money by slowing down service!!!! They lose money instead, even my 4 year old can figure that out!!  What they need to do is get rid of some of these high paid supervisors and Postmasters that don't do anything but make the employees jobs unbearable.  Why does the Postmaster General Make over 800k a year when the business he is in charge of is going down the drain?
Feb 14, 2012 1:50AM
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My dad always said "if you don't open your mouth, people will never know just how stupid you really are". I see a lot of posts here from people who know absolutely nothing about that upon which they comment. For example, to the person that says the post office employees can have split days off and it won't hurt them- we already do. To the person that believes we only work half a day on saturdays- my job is 8+ hours, five days a week. To the person complaining about there being 5 windows but not enough people to man them- that's because the post office eliminated those jobs to save money. To the person that says  post office priced itself out of business- right now, allowing for inflation, the mail has never moved so fast, or so cheap, in its history. To the person that believes we are low skilled workers, I bet a week's salary that I can do your job better than you can do mine (try working a winter in cold country or a summer in the desert with no cover from the elements. I think I can handle your job of being in nice air-conditioned comfort when I ask "would you like fries with that?").  You have no concept of what we do during the day except for the 30 seconds you see us, and you never think about us except if your mail isn't there when you go to the box. This is obviously a thankless job, and the reason I do it is the same as yours: to put food on the table and provide for my family. Quit trying to fix something until you know what you're talking about. And by the way, you aren't getting the whole story...
Feb 13, 2012 8:16PM
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AS a retired Postal Service employee I understand why the Service is in trouble. First they don't want to change the way they operate by giving the so called Std. Mail ( we call it Junk) a break on their rates. It is assine to allow them to send their mail from 10c to 25c, when the rest of us have toi pay the full price, 44c. My Mother-in-Law just past away, and she would got  between 20 & 30 pieces of Junk Mail per day, and a lot of it was dupicate. When a carrier goes out the door of the office with their mail to be delivered, they carry all classes of mail. So they are giving this Std.(Junk Mail) the same service as first class mail. This is not only shamful but ridculous when it comes to be non-cost effectiveness. Secondly, all the high paid bureacrats in the Service is not needed, and the PM General should be someone from within the ranks, and not some political appointee.One who has worked in the system knows how it works, and not some politician.Thirdly, I pay over $500 a month out of my pension for health care incurance for my wife and me. Maybe the higher ups have a better deal than us average workers, which I wouldn't  be surprised. I fought the system for over 20 years, and it doesn't really want to change their ways. If no changes, then let it go!  
Feb 13, 2012 7:29PM
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By having the Post Office cut service to save a few bucks will only lead to its demise.  The value of the Postal Service is not generally well understood and the loss will be far greater than anyone expects. 

 

We could be one of the few countries in the world who will not have a postal service.  I think I would prefer not that have that happen.

 

Are we America or are we working towards being a second class country?

Feb 13, 2012 7:57PM
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OK... My suggestion is that those businesses that request customers to go paperless should be asked to pay a "fee."  Check this out, they say it is "green' or to "save the environment," let's not forget the financial savings to the particular business.  These business are not giving the customer any type of credit for going paperless; yet, they are savings on postal cost, material, and labor.  Well, it would be nice to know that these savings are going further than in their "profit" column.  If I were to receive my car insurance statement via the mail, the business would charge $3.50 per month.  Yet, I am not credited $3.50 per month for receiving statement on line and paying on line.  Wow....
Feb 13, 2012 10:58PM
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The postal service is in financial trouble for a multitude of reasons.  The first reason is it has had to overpay pension benefits by $81.9 billion dollars.  The second is that Congress has required it to prefund over 50 years of future retiree health benefits in just 10 years.  The third involves the mandate of universal delivery.   Delivering to just about every address in the USA on a daily basis costs an enormous amount of money.  If every delivery was moved to a centralized location, it would save billions upon billions of dollars.  You'd have to be inconvenienced, and go down to the corner to open a locked box.   UPS and FEDEX pick and choose where they will deliver, and what they will deliver.  They do NOT have brick and mortar locations scattered all over the United States.   Every week day, UPS backs up to post offices all across the nation, and unloads large numbers of packages.  The post office delivers them for UPS.

UPS workers make a lot more money than postal carriers. 

The final reason is that Congress makes the post office operate at break even.  It cannot raise rates until it has already spent the money.  When fuel prices surge, UPS and FEDEX attach a fuel charge.  The post office cannot do that.  Also, if you allow for currency differences, it costs 54 US cents to mail a letter in Canada, and 70 US cents for the UK.  Forty-five cents will still be a bargain. 

If Congress were to give the post office back the money it has overpaid to the pension funds, they'd have to drastically cut spending elsewhere.  That would mean less for pet projects, and their political agendas.  They'd have less money to use for pork, and buy votes.  The president

would rather sacrifice the post office than cut the fat out of his proposed budget.

Feb 13, 2012 7:30PM
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I know a lot of people who work for the PO and they all agree:  Working part-time, but getting paid full-time, is not financially sustainable.  Especially on Saturdays, many PO employees work 5-6 hours, but get paid for 8.  Same thing at many of the PO sorting centers.  I'm not making this up, but I am told that union rules dictate these hours.  Retirees also have, in many cases, extravagant retirement packages that include pensions and healthcare.  Again, not financially sustainable as agree even by those retirees.  PO can keep raising rates, but it's simply not keeping up with their costs.  If the gov't wants to cut Saturday deliveries, I won't like it, but I can adapt.  I rather have no deliveries on Saturdays, than no PO at all.
Feb 14, 2012 7:40AM
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They simply need to raise the price of stamps to what they need to. Stop with this silly 1 cent increase garbage. Just raise it 10 cents and tell the people to stop whining about it. It is still a huge bargain compared to other countries (many of which don't have Saturday delivery as well, by the way.)
Feb 14, 2012 7:50AM
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John O...another ignorant child thinking you are an expert on everything.  You know why Fed Ex and UPS are so profitable? Because they are allwoed to (and DO) pick and choose what addresses to deliver to. I guess you want people who live in rural areas to not have the same right to mail delivery that city folk have.

 

If you mail a package via Fed Ex to a place out in the boondocks, chances are they will either say NO outright and tell you to go somehwere else, or they will take your package for a much higher fee and then hand off that package to the US Post Office for the final 50 miles or so...the unprofitable leg of the journey...because they must by LAW deliver to everybody.

 

They also can (andDO) raise prices any time and as much as they want, and can make a profit tht allows them to weather the storm a bit and overcome some bad downturns in business. The private delivery services are no more efficient than the US Post Office. It is just that they are not subject to the same SEVERE limitations under the Constitution that the USPS is. If they were, they would be failing now too.

 

I guarantee that if the government told Fed Ex or UPS that they could now start delivering regular mail...but they had to accept ALL mail and deliver it themselves, all at the same rate, they would say "Thanks, but no thanks." They want NO part of having to drive 5 miles each way just to deliver five or six 45 cent letters.

Feb 13, 2012 7:51PM
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i know a "retired" postal inspector who retired @ 51. imagine that, a medium skilled mid level bureaucrat who retires @ 51! no wonder the postal service is broke! how many of you professionals out there in the real world retired @ 51?
Feb 14, 2012 8:07AM
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These are honestly some of hte most ignorant comments ever. Cutting Saturday delivery would make us a second class country? REally Tired of Bashing? You DO realize that most countries have NEVER had Saturday delivery, right? And even more have cut it years ago.

 

Others saying it won't save money? OK..thanks for your business expertise! Your community college "professors" must br proud of all you have learned to be able to make such a statement without doing ANY research with acual data.

 

Others saying it would cost busiensses hundreds of billions of dollars a year? Wow..another community college C- student. Doesn't even try to back up his silly statements with facts. (because he can't) Bills won't get paid on time? Then ADJUST! If you are stuck in the 20th Century and still mail a check to your collectors every month, just mail it ONE DAY EARLIER. You may not even have to if you are mailing it on a Monday or Tuesday since it will still get there in the same amount of time.

 

Or worrying about Monday holidays causing people to not get mail for 72 hours? Oh noes! Whatever will they do! If it is a Monday holiday then most businesses are off as well. Just like on Saturdays.

Feb 13, 2012 5:52PM
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You won't lose revenue for not getting your mail on Saturdays.Most businesses are closed on Saturdays for they don't want to pay overtime,or they just want to be closed.The others will adjust to it,just like you will.This will save on fuel,also.Just mail it on Friday,or wait till Monday,just like going to the bank.Don't fret,just get used to it.It could be three days a week.
Feb 14, 2012 5:41AM
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Will be a sad day when Saturday delivery goes and I sure don't see where the savings will be. The weeks mail will simply be packed into 5 days of delivery instead of 6. In addition there will be significant job loss as the "head-count" will further reduce the Post Office workers' numbers. IMHO the first class stamp is one of the biggest bargains around today...for  45 cents I can mail a letter anywhere in the US and have it delivered in a timely manner. You can't buy a can of soda in a vending machine for that.....

Feb 14, 2012 7:44AM
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mrgreenjeans..not ONE person has stopped using the post office because of prices. That is so ignorant it is funny. People stopped using the post office because of the intenret. PEriod. Then cheap or unlimited long distance and cell phone plans put the final nail in the coffin. There simply is not reason to send a letter than takes 2-3 days when e-mails and long distnace phone calls are immediate and free.
Feb 14, 2012 12:45AM
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It sure is funny how everyone knows how to run this country until it is something that changes their lives then it is a whole different story. Most of the comments on here are based on ignorance. I guess everyone has their opionions, along with other things. If you are not educated in what you are talking about keep your stupidity to yourself.

Feb 13, 2012 11:58PM
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if the post office wants to save money, do away with the big sticker on common first class stamp sheet of 20. it's unnecessary & a waste of ink. just print the bar code.
Feb 13, 2012 8:39PM
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Over 8 years ago when I was working full time, I was in conference with my plant manager and I told him that the US government could save hundreds of thousand dollars a year by eliminating Saturday deliveries of mail. The fuel, the man power, the cost of heating and cooling the buildings, equipment usage and maintenance would make a houge savings. The postal service has been and will continue to loose money until they take positive measures to correct there problems. This may not be the only way for them to save money but it is definately a good syary..
Feb 13, 2012 6:50PM
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Financial transactions will not suffer due to a loss of Saturday delivery.   The advent of electronic funds transfers can negate the loss in time.  If your business hasn't gotten on board, your are behind the times.  Even with those banks that have expanded hours to include weekends, all transactions are posted on the next Business day - although cash can exchange hands.   The loss of a day for those that have gotten the snail mail movement to a science may be traumatic, but we can adapt, improvise and overcome.   As Americans, it's what we do.

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