US Post Office on the brink of default

posted at 10:30 am on September 5, 2011 by Jazz Shaw

We seem to hear this story on an annual basis, but this time they sound like they mean it. The United States Postal Service is teetering on the brink of financial collapse, with a $5.5 billion payment to retirees coming due which they can’t cover and a grand total of $9.2B in red ink for the year.

“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…

At the same time, decades of contractual promises made to unionized workers, including no-layoff clauses, are increasing the post office’s costs. Labor represents 80 percent of the agency’s expenses, compared with 53 percent at United Parcel Service and 32 percent at FedEx, its two biggest private competitors. Postal workers also receive more generous health benefits than most other federal employees.

The Lonely Conservative thinks the real culprit is one we’ve seen many times before.

No layoff clauses?!?! No wonder they can’t adapt to the changing marketplace. There will always be a market for parcel delivery, but the union and politicians are keeping the Postal Service from doing what’s necessary to stay viable. I wonder how long it will be before we the taxpayers bail them out.

As an aside, note the difference between the labor costs of UPS and FedEx. UPS is unionized and FedEx is not. Here’s a video from a couple years ago explaining how the two companies are governed by different federal labor laws. UPS tried to have that changed so unions would have had an easier time unionizing FedEx.

The New York Post has an excellent rundown of the cost / revenue problems facing the USPS, as well as the factors complicating any possible solution. While the union issues are certainly a huge part of the problem, it’s important to remember that the Post Office is in something of a unique position. They aren’t technically part of the government, as they go to great pains to point out in their recent ad campaign. Their operation isn’t directly funded by tax dollars. But unlike a completely private company, they live with the federal government’s thumb pressing heavily on the scale.

They still report to the government and require its consent for many actions which most businesses take for granted. For example, they are looking at laying off 120,000 more workers and almost that many again being eliminated through attrition. But they’re going to have to get approval from Congress before they can do it. And their powerful union has a far fatter retirement package than private carriers in the same business space. Again, the USPS can’t even negotiate to change those agreements without getting the nod from Uncle Sam.

What happens if the post office goes under completely? While individual, point to point, single package delivery is handled fairly cheaply and efficiently by their competitors at UPS and FedEx, (for just two examples) those outfits are not set up to deliver the millions of tons of daily paper the USPS handles for the same bulk costs. Prices will go up, though many of us might see a benefit in having less junk mail show up at our doors. In the political arena, direct mail campaigns will become more expensive, putting further pressure on limited donor resources. And all of this ignores the additional quarter million people who will join the jobless roles.

It’s not a pretty picture. Unfortunately, you can probably guess where this is going. Expect to see a push in Washington to have us bail them out. And you can just imagine the response that’s going to receive even as we struggle to find trillions in additional cuts.

UPDATE: As several in the comments section point out, it was rather clumsy to say that the USPS isn’t “part of the government.” More correct would be to say that they aren’t funded the same way that the rest of the government is in terms of a drain on the general fund of taxpayer dollars.

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Comment pages: 1 2

I can’t help but wonder. Is this another manufactured crisis put forth by the administration to try and scare us to keep us in line? I mean this only comes a week after Hurricane Irene the previous manufactured crisis proved to be such a bust and embarrassment to the administration.

Tommy_G on September 5, 2011 at 11:55 AM

Well, this at least explains the quality of customer service. I thought it was just a function of Soviet-style bureaucratic insouciance. But in the end, it turns out we work for them!

Blacklake on September 5, 2011 at 11:58 AM

Shut it down! (NSFW)

pain train on September 5, 2011 at 11:59 AM

The answer, if you don’t think the Feds should provide postal services, is to amend the Constitution. Where are all the strict constructionists?

MJBrutus on September 5, 2011 at 11:15 AM

Ah, yes. Because our Founding Fathers were all for a public union that has contracts that allow for zero layoffs no matter how bad or useless the agency becomes, so the members (dispropotionately black for some reason) can continue to vote democrap and allow themselves more raises and perks even though the agency BLEEDS money. Raise prices and taxes on the folks to keep them all working on the dole.

VegasRick on September 5, 2011 at 11:28 AM

That’s a strong evisceration. Well said.

fossten on September 5, 2011 at 12:00 PM

Because Article 1, Section 8 obligates them to provide the service.

[MJBrutus on September 5, 2011 at 11:41 AM]

I’d have been happy to discuss this further, but continually reverting to appealing to your authority to interpret the manner of the use of that Congressional power shows you’re not serious in discussing this. It says nothing in the Constitution about “providing service”. It says establish offices and roads.

Congress can establish them by declaring the Internet will function as a post office and wires as the roads. Over and done, obligation met.

Dusty on September 5, 2011 at 12:00 PM

The answer… is to amend the Constitution. Where are all the strict constructionists?
 
MJBrutus on September 5, 2011 at 11:15 AM

 
Still opposed to creative judicial interpretation, which has nothing to do with this.
 
We’re fine with the amendment process because, as many sixth graders know, that’s how the system was built.

rogerb on September 5, 2011 at 12:00 PM

Dusty on September 5, 2011 at 12:00 PM

Oh please. Don’t talk to me about being not serious. Especially after the boneheaded “solution” you just provided.

One other, thing, depending on the terms of the contracts, private companies may well end up paying the Feds for the exclusive rights to deliver the mail.

MJBrutus on September 5, 2011 at 12:03 PM

rogerb on September 5, 2011 at 12:00 PM

I don’t know who “we” is, but yeah, the amendment process is the way to end the post office if that is what you want. Good luck with that.

MJBrutus on September 5, 2011 at 12:04 PM

It was only in the last 60 years or so that the technology and infrastructure existed to make for-profit package and correspondence delivery feasible. Even so, the business plan for FedEx was famously rejected by its founder’s business professor.

The Post Office was originally founded because mail delivery required someone to load packages and correspondence in a series of wagons to be run across hostile and barren areas of the country. Nobody could make a profit doing it, but it needed to be done, so it fell to the government.

Yet even after the advent of a viable private-sector alternative, the government refuses to back off, preferring the crash and chaos that comes from propping up unviable business models for the sake of sentiment, or the votes of union members.

Sekhmet on September 5, 2011 at 12:05 PM

USPS is one of the USA’s largest employers.

itsnotaboutme on September 5, 2011 at 10:39 AM

It’s also one of the largest employers of black folks. Let the games begin.

SouthernGent on September 5, 2011 at 12:08 PM

yeah, the amendment process is the way to end the post office if that is what you want. Good luck with that.
 
MJBrutus on September 5, 2011 at 12:04 PM

 
So why bring up the judicial system?

rogerb on September 5, 2011 at 12:08 PM

Sounds like a good candidate for a takeover by FedEx and/or UPS. That’s what is supposed to happen to poorly managed companies as an alternative to bankruptcy. Throwing good money after bad is for fools and Democrats. But I repeat myself.

Let’s also remember that the Post Office is exempt from all Federal,State and local taxes. And they still can’t make a go of it. The drop in revenue from technological changes is a nice excuse, but these idiots were losing money long before the first e-mail was sent. Besides, at least when Barnes and Noble failed to keep up, they didn’t send me a bill.

RadClown on September 5, 2011 at 12:10 PM

rogerb on September 5, 2011 at 12:08 PM

I pointed out that a strict constructionist would respect the idea that Congress is obligated to provide mail service under our Constitution.

MJBrutus on September 5, 2011 at 12:10 PM

The answer, if you don’t think the Feds should provide postal services, is to amend the Constitution. Where are all the strict constructionists?

MJBrutus on September 5, 2011 at 11:15 AM

Ah, yes. Because our Founding Fathers were all for a public union that has contracts that allow for zero layoffs no matter how bad or useless the agency becomes, so the members (disproportionately black for some reason) can continue to vote democrap and allow themselves more raises and perks even though the agency BLEEDS money. Raise prices and taxes on the folks to keep them all working on the dole.

VegasRick on September 5, 2011 at 11:28 AM

Why not simply remove the monopoly the USPS has on YOUR mailbox and let the free market take over?

Chip on September 5, 2011 at 12:13 PM

Sure the Constitutional requirement to establish a Post Office will be raised in the Congress. But here’s the thing — that requirement doesn’t specify things such as:

Post Offices per capita
Number of days of delivery
Pensions
Distance to nearest Post Office
A requirement that all Post Office operations be run by the Federal gubmint

and so on. The Post Office is also supposed to be self financing, but that isn’t in the Constitution either. All these things are within the purview of the legislative branch, and more.

The Post Office did propose reforms during the Bush term, and they were shot down by the Congress. The problem is Congress primarily, not the Post Office.

GnuBreed on September 5, 2011 at 12:16 PM

We seem to hear this story on an annual basis, but this time they sound like they mean it. The United States Postal Service is teetering on the brink of financial collapse, with a $5.5 billion payment to retirees coming due which they can’t cover and a grand total of $9.2B in red ink for the year.

Learn to compete or go the way of the buggy-whip.

CYA USPS….!

Tim_CA on September 5, 2011 at 12:16 PM

Chip on September 5, 2011 at 12:13 PM

A mechanism is needed to ensure that rural and under served areas have access to the same quality and price of service as more profitable areas. Congress is obligated to see that it is done. What I’ve proposed is a free market solution in that companies compete for the exclusive right to deliver to your mailbox.

MJBrutus on September 5, 2011 at 12:17 PM

I worked for the post office in the late 70s. They ignored workers who did nothing, effectively penalizing me for always doing the work asked of me. I once made a coworker sit down and do nothing because he was playing basketball with the packages we were sorting into large bags, taking especial care to go for the “FRAGILE” markings. I finished his job and my job myself, and told my supervisor. Nothing happened.

On the other hand, I was once working flats, which required you to stand in front of a wall of boxes and sort magazines and large envelopes into the various route numbers. It’s a tiring job, and you’re on your feet all night. When the Letter-sorting machine operators got their first break (every two hours), I sat down with them. If you worked the LSM, you sat for 20-30 minutes keying in the mail, then went around back for about the same time loading the mail into plastic containers, and back to keying in the mail. In other words, you were on your ass about an hour-plus of the two hours. My supervisor told me to get back to work, that I couldn’t take a break. I told him I was on my feet for two hours, and the LSM operators were on their feet for about 30 minutes, and that I deserved a break if they did. No go. He said it was against regulations, and get back to work. So I walked past him to the ladies room, where I stayed for the full ten minutes. He couldn’t stop me from taking that break.

Yeah, I can’t understand why the Post Office is failing. Its work ethic, its supervisor tactics–they’re just so awesome.

Meryl Yourish on September 5, 2011 at 12:17 PM

I pointed out that a strict constructionist…

MJBrutus on September 5, 2011 at 12:10 PM

 
I do not think it means what you think it means.

rogerb on September 5, 2011 at 12:17 PM

The problem is Congress primarily, not the Post Office.

GnuBreed on September 5, 2011 at 12:16 PM

Bingo!

MJBrutus on September 5, 2011 at 12:17 PM

Solution: Have Nanzi slip this in at the end of every paragraph of USPS regulations:

“…or as the Secretary (Postmaster) deems necessary.”

Western_Civ on September 5, 2011 at 12:19 PM

That’s a strong evisceration. Well said.

fossten on September 5, 2011 at 12:00 PM

Why thank you Fossten. Our 99% agreement factor comes through about 99% of the time. I’m glad we are on the same team.

VegasRick on September 5, 2011 at 12:21 PM

Government checks: DIRECT DEPOSIT ONLY. No more stolen/lost/late checks and no checks delivered to bogus addresses. Much faster and safer and less costly to process.

You don’t have a bank? You don’t get a check.

JetBlast on September 5, 2011 at 12:21 PM

Chip on September 5, 2011 at 12:13 PM

A mechanism is needed to ensure that rural and under served areas have access to the same quality and price of service as more profitable areas. Congress is obligated to see that it is done. What I’ve proposed is a free market solution in that companies compete for the exclusive right to deliver to your mailbox.

MJBrutus on September 5, 2011 at 12:17 PM

So you still want a monopoly on everyone’s personal property?

This is clearly a case where a government enforced monopoly on the market has failed – modifying it slightly and leaving the same basic structure in place won’t solve the problem.

Chip on September 5, 2011 at 12:22 PM

When you have a monopoly, courtesy of the Federal Government (exclusive delivery of first class mail), and you still can’t make money, courtesy of unions, it’s time to give up and shut it down.

Sell of the rights to first class and bulk mail to private delivery companies, and when the last of the penision funds runs out that’s it….finished, over, caput, done, closed,…footnote in the history books…

PatriotRider on September 5, 2011 at 12:23 PM

Bail them out if: the no-layoff clause goes, defined pensions are replaced by 401ks, and they all come under Obamacare, or at least a basic HMO. Retirees get a Medicare supplement HMO.

I include the Obamacare bit just to see how they scream at how awful it is while the Dems and Obama try to campaign on the wonderfulness of it.

Wethal on September 5, 2011 at 11:01 AM
Also raise retirement age to at least 62.

Wethal on September 5, 2011 at 11:03 AM

Oops. forgot the most important one. No mandatory dues deduction by the USPS. Union has to collect its dues directly from the member.

This is what freaked out unions in WI the most. The loss of the cash stream.

Have to ask a union member for the monthly dues, and he wonders, “what have they done for me lately? what are they doing with my dues/” Questions union officials don’t want to answer.

Wethal on September 5, 2011 at 12:24 PM

You don’t have a bank? You don’t get a check.

JetBlast on September 5, 2011 at 12:21 PM

Thats racist and bigoted. Next you’ll be complaining that photo ID should be required to vote.

Geeez.

BobMbx on September 5, 2011 at 12:25 PM

These are the same govt employees who will run health care starting in 2014.

angryed on September 5, 2011 at 12:26 PM

It might help if they quit spending for labor,fuel and equipment costs to bring me all that damned junk mail I have to turn around and haul to the landfill. Multiply that times the population of of the United State and I’ll bet a dollar to a hole in a doughnut it comes to over $9.2 B

MikeA on September 5, 2011 at 12:29 PM

MikeA on September 5, 2011 at 12:29 PM

Junk mail is the reason they didn’t go broke long ago. It’s a big money maker for the USPS.

MJBrutus on September 5, 2011 at 12:31 PM

What I’ve proposed is a free market solution in that companies compete for the exclusive right to deliver to your mailbox.

MJBrutus on September 5, 2011 at 12:17 PM

So you still want a monopoly on everyone’s personal property?

This is clearly a case where a government enforced monopoly on the market has failed – modifying it slightly and leaving the same basic structure in place won’t solve the problem.

Chip on September 5, 2011 at 12:33 PM

Junk mail is the reason they didn’t go broke long ago. It’s a big money maker for the USPS.

MJBrutus on September 5, 2011 at 12:31 PM

and union trash collectors.
/bada bum bum*

ted c on September 5, 2011 at 12:37 PM

Chip on September 5, 2011 at 12:33 PM

But you repeat yourself. I have explained that it is the duty of Congress to ensure that all Americans have access to a uniform level of service. I have provided one suggestion that is a vast improvement over what we have and has also been proven to work for other services, such as privatization of toll roads.

If you have a better idea, cool. But simply saying that government should remove itself entirely is not permissible under our Constitution unless amended.

MJBrutus on September 5, 2011 at 12:38 PM

It is one of the few government agencies explicitly authorized by the United States Constitution.

So agencies that are constitutional founder because of Congress and agencies that are not constitutional are enriched because of Congress. (Notice that I didn’t say “thrive.”)

cheeflo on September 5, 2011 at 12:44 PM

Junk mail is the reason they didn’t go broke long ago. It’s a big money maker for the USPS.

MJBrutus on September 5, 2011 at 12:31 PM

So, why is are the enviro-wackos not on their case for clogging up the landfills for money?

On the other hand, I am probably compainging too much. I have been planning to build a new home as I near retirement and I hope to construct a heat plant that can produce heat by burning debris in an outdoor incinerator and using that to heat water that is then piped to the house. If that works I’ll be trying to get on every junk mail mailing list I can find and just let the USPS deliverer my heating fuel daily.

MikeA on September 5, 2011 at 12:45 PM

So, why is are the enviro-wackos not on their case for clogging up the landfills for money?

MikeA on September 5, 2011 at 12:45 PM

If they’re not, they should. And in this case, I’d join them. I hate junk mail too, but that doesn’t alter the fact that the USPS has been kept afloat by it.

MJBrutus on September 5, 2011 at 12:48 PM

What I’ve proposed is a free market solution in that companies compete for the exclusive right to deliver to your mailbox.

[MJBrutus on September 5, 2011 at 12:17 PM]

You categorize creating monopolies (with all the limitations and governmental regulation it entails) as a free market solution?

And you wonder why I gave up discussing this seriously with you.

Dusty on September 5, 2011 at 12:48 PM

Dusty on September 5, 2011 at 12:48 PM

No, I don’t wonder why someone as glib as yourself has given up. I welcome it, but I don’t wonder about it.

MJBrutus on September 5, 2011 at 12:49 PM

I keep hearing a commercial on the radio…

Ahh, I found the commercial. Here’s a paraphrase…

American Postal Workers handle 165 billion pieces of mail each year, and it doesn’t cost taxpayers a single cent. The United States Postal Service doesn’t run on tax dollars, it’s funded solely by stamps and postage.

Brought to you by the men and women of the American Postal Workers Union.

Meanwhile, Daryl Issa is examining why the Postal Service is in such red ink, and the same APWU who claims no taxpayer money is spent on the operation of the postal service is bashing Issa for spending taxpayer money on a website.

The website is from Issa’s Committee on Oversight and Government Reform, and showcases a bill co-sponsored by Issa to avoid taxpayers footing a massive bailout of the USPS. So Issa, in the business of doing the job he was given, government oversight and reform, is using a website to tell the public about it. Websites such as this cost what amount per year to maintain? Let’s say it costs $10,000 per year, a ridiculous overestimate. That’s peanuts compared to the cost of the ad campaigns being put on by the APWU to tell us that they aren’t spending tax dollars. Who pays the Postal Workers, who pay their union dues so that they can lie to us on radio ads? We do.

Freelancer on September 5, 2011 at 12:50 PM

What business could possibly survive with a guarantee to a greedy union to never lay anyone off?

Step One: bust the greedy union. The rest is easy.

slickwillie2001 on September 5, 2011 at 12:54 PM

Doughboy on September 5, 2011 at 11:34 AM

point taken DB…

cmsinaz on September 5, 2011 at 12:55 PM

Who pays the Postal Workers, who pay their union dues so that they can lie to us on radio ads? We do.

Freelancer on September 5, 2011 at 12:50 PM

I agree. That’s why removing the automatice dues deduction is so imporant in any bailout or union contract re-negotiation.

The unions will scream about this more than any pension, benefite, wage or hours reform. The union dues go to pay for poltiical activities and the fat salaries of union officials. Once this is voluntary, the cash dries up.

Wethal on September 5, 2011 at 12:56 PM

What business could possibly survive with a guarantee to a greedy union to never lay anyone off?

Step One: bust the greedy union. The rest is easy.

slickwillie2001 on September 5, 2011 at 12:54 PM

Gee, it couldn’t be default of the union, could it?

Drained Brain on September 5, 2011 at 1:24 PM

The what? You mean the guys that bring me nothing but hard copy SPAM?

My bills, statements, and communications with others have been coming to my home electronically for quite awhile now. There are a few bills that still come via the mail – but if the USPS went away, I have no doubt it would be less than 30 days before I started getting *everything* via email.

Midas on September 5, 2011 at 1:25 PM

Chip on September 5, 2011 at 12:33 PM

But you repeat yourself.

And you repeat the tactic of dodging the question:

So you still want a monopoly on everyone’s personal property?

If you have a better idea, cool. But simply saying that government should remove itself entirely is not permissible under our Constitution unless amended.

MJBrutus on September 5, 2011 at 12:38 PM

It’s call an unfettered free-market, and it works, unlike your system.

Chip on September 5, 2011 at 1:29 PM

If they’re not, they should. And in this case, I’d join them. I hate junk mail too, but that doesn’t alter the fact that the USPS has been kept afloat by it.

MJBrutus on September 5, 2011 at 12:48 PM

What would be the downside of the USPS ceasing to exist? The only things I get in the mail these days are things I’d prefer to not get at all or that are duplications of things I receive online. most banking transactions I do are electronic. My bills are paid online except for a few and those should be. Keeping the postal service alive today is something akin to the effort back in the day of trying to prevent the demise of the stage coach. I don’t see anything they are doing that the private sector can’t do better and more efficiently.

MikeA on September 5, 2011 at 1:30 PM

Another stunning accomplishment under King Hussein.

PRIVATIZE and DE-UNIONIZE

stenwin77 on September 5, 2011 at 1:35 PM

To those glib posters who just say eliminate it:

Article I – The Legislative Branch

Section 8 – Powers of Congress

To establish Post Offices and Post Roads;

MJBrutus on September 5, 2011 at 10:58 AM

MJBrutus – does the Constitution say how many Post Offices and Post Roads are required? Since it’s plural, maybe Constitutionally we can close all but two…

Midas on September 5, 2011 at 1:39 PM

Would anyone notice?

molonlabe28 on September 5, 2011 at 1:40 PM

MikeA on September 5, 2011 at 1:30 PM

Sure. I’ve been arguing for privatization all day.

MJBrutus on September 5, 2011 at 1:58 PM

Midas on September 5, 2011 at 1:39 PM

Nor does it say which borders we need to enforce. Perhaps we should only guard the Canadian border.

MJBrutus on September 5, 2011 at 1:59 PM

…That’s why removing the automatic dues deduction is so imporant in any bailout or union contract re-negotiation.

The unions will scream about this more than any pension, benefit, wage or hours reform. The union dues go to pay for poltiical activities and the fat salaries of union officials. Once this is voluntary, the cash dries up.

Wethal on September 5, 2011 at 12:56 PM

This is one issue on which greedy union members and greedy union leadership do not agree. Many workers would welcome the right to pay or not pay union dues, because their political breakdown might favor democratics, but not as much as union leadership does.

I’m sure that the fact that union leadership supports far-left politicians nearly exclusively is a sore point with many of them.

slickwillie2001 on September 5, 2011 at 2:06 PM

The USPS needs to go. It’s a collection of rude, lazy people that are overpaid and protected by their union. I have to deal with the USPS everyday while I run my own bossiness, and totally regret it. Long lines, antiquated technologies and monopoly/union/federalitis. They aren’t allowed to put their delivery trucks in reverse, I mean really?

Hening on September 5, 2011 at 11:24 AM

Your comment is rude and ignorant. The use of generalities is the problem.

1st: All USPS employees are not in the union.

2nd: Rude and lazy people are in every business I have ever seen. It doesn’t mean that all are like that. All the USPS employees I know work hard and take pride in their jobs.

3rd: USPS sorting equipment is not antiquated in any way. Take a tour of a large Postal sort facility if you don’t believe me.

4th: You CAN put your truck in reverse. I do it all the time. There are only rules about backing up while delivering mail on the street. Running over children that run to greet the Postman is not something anyone wants to happen.

As has been stated previously, it is CONGRESS that has caused the current postal crisis along with Union contracts.

BierManVA on September 5, 2011 at 2:10 PM

Dunno how it is elsewhere – in my rural area, we have a Post Office for each little community. There are about 8 communities in our region, isolated by mountains.

But everybody, if they are driving anyway, goes to one of the 2 biggest communities for groceries, banking, etc. So we could do without 5 or 6 Post Offices up here.

Since they won’t deliver mail on rural dirt roads, the whole mail thing is a pain for us – pay for a PO box, drive 10 miles to get stuff I don’t want anyway. Cost for PO box just went up, too. I could live without it, easily.

jodetoad on September 5, 2011 at 2:13 PM

Both management and labor have more to lose from a congressionally imposed solution where the imperatives will be political rather than operational. Management and Labor at the USPS should negotiate a solution and then present to Congress any changes in current law necessary to implement it as a united group. It is no one’s fault that technology has changed the business environment for the operation. This happens in all sorts of businesses in the private sector all the time and when the companies’ backs are against the wall, labor generally accepts a mutually agreed upon plan to keep the operation going rather than have everyone lose. Unions railing against Republicans or Congress is not useful. Having squabbling between management and labor is not useful. Let the people who work in the operation figure out how to make the USPS a competitive long term player in the market and then let Congress implement the agreement. Congress should make clear however while the USPS negotiates a plan, that they will not be a piggy bank that gives them an unfair leg up on the competition beyond the monopoly on 1st class mail they already have.

KW64 on September 5, 2011 at 11:50 AM

You’re being rational…stop it!

Dr. ZhivBlago on September 5, 2011 at 2:20 PM

Is it just me or can a lot of our financial issues be solved by outlawing Unions…

Wolftech on September 5, 2011 at 2:23 PM

When faced with tough times, companies must cut spending and come up with new revenue. Unless they feed from the public trough.

To be honest, I fully expected the USPS to compete in the parcel business through taxpayer funded subsidies to offset rising fuel prices. I have to wonder how long term fuel costs will hurt the private parcel delivery companies.

I have no doubt that Congress will “act” anyway, throw them a few billion and push this problem off for a couple years.

There is far too much social justice being carried out in the hiring process for this to fail. It is the perfect progressive business model. Monopoly, quotas, no layoffs, and a giant Sugar Daddy in Uncle Sam.

reaganaut on September 5, 2011 at 2:34 PM

Is it just me or can a lot of our financial issues be solved by outlawing Unions…

Wolftech on September 5, 2011 at 2:23 PM

You’re probably right. If that unionized employee next door loses his job or has to accept drastic pay cuts, and has to walk away from his home, goes on unemployment, has to get welfare for his family, and is no longer paying property taxes, and is spending less-doesn’t affect me or my community in the slightest.

Dr. ZhivBlago on September 5, 2011 at 2:39 PM

How did it happen? Look for the union label.

faol on September 5, 2011 at 2:42 PM

Sure. I’ve been arguing for privatization all day.

MJBrutus on September 5, 2011 at 1:58 PM

With the supreme advantage of a Government enforced monopoly on everyone’s personal property – their mailbox.

Or as you term it: the exclusive right to deliver to your mailbox.

That’s not really privatization, that would like the government ordering you to buy health insurance.

Chip on September 5, 2011 at 2:53 PM

Prices will go up, though many of us might see a benefit in having less junk mail show up at our doors. In the political arena, direct mail campaigns will become more expensive, putting further pressure on limited donor resources. And all of this ignores the additional quarter million people who will join the jobless roles.

OK, “junk mail” can be annoying-if it’s something you’re not interested in. On the other hand this is (so far) a free enterprise system. There’s nothing out of the ordinary in such a system of having companies mail out items in an effort to get you to buy something…to advertise and to solicit business.

Occasionally, I have made purchases that I otherwise wouldn’t have made due to unsolicited retail catalogs being shipped to my door. Clearly they find the cost profitable. Not so sure they would through UPS or the like.

In fact, I have not ordered certain items online because of the UPS S&H, and used to order far more things when the USPS routinely handled the bulk of commercial S&H.

Some weeks ago we had a thread here about how the Europeans handle mail delivery. Really? So the European Socialists are the new standard for American Conservatives? I’m sure Michael Moore would feel right at home here on this issue.

Dr. ZhivBlago on September 5, 2011 at 3:05 PM

You’re probably right. If that unionized employee next door loses his job or has to accept drastic pay cuts, and has to walk away from his home, goes on unemployment, has to get welfare for his family, and is no longer paying property taxes, and is spending less-doesn’t affect me or my community in the slightest.

I can’t get a read on you between this post and the later one you make about the European socialists not being an answer for Conservatives. People lose jobs daily that have nothing to do with unions, and they are after all a European socialistic kinda answer to life. Is there something about the breed of believing and support all union tactics that mean a person won’t grow up, grow a pair, and gt on with life without unions?

Just wondering.

Noelie on September 5, 2011 at 3:42 PM

It might be that rural areas would get less than Daily deliveries(M,W,F or T,Th,S). or Postage might shift to something other than flat rates no matter where. But the tools exist for delivery and if there is a need, someone will fill it.
OBQuiet on September 5, 2011 at 11:18 AM

We live in a rural area. Compared to 5-10 years ago, I buy a fraction of the number of stamps I once did. Our delivery person once asked us to buy a bigger box becaue we would often receive tons of mail. Those days are gone. There are frequently days when we get nothing at all. I could easily live with delivery just 3 days a week. Heck, I’m cancelling Netflix anyway, due to that big price increase.

humdinger on September 5, 2011 at 4:22 PM

And all of this ignores the additional quarter million people who will join the jobless roles.

But if some private company, UPS, Fedex, or a newbie, takes over they’ll suddenly need a few of those jobless, won’t they? With luck, they’ll hire the ones with a work ethic, or at least ones who will work.

Qzsusy on September 5, 2011 at 4:30 PM

I mean FedEx.

Qzsusy on September 5, 2011 at 4:30 PM

I pointed out that a strict constructionist would respect the idea that Congress is obligated to provide mail service under our Constitution.

MJBrutus

No it isn’t. According to the Constitution, Congress has the power to provide mail service, not the obligation to provide it. Per the Constitution, Congress also has the power to borrow money. But it’s not obligated to borrow money.

xblade on September 5, 2011 at 4:52 PM

The answer, if you don’t think the Feds should provide postal services, is to amend the Constitution. Where are all the strict constructionists?

MJBrutus on September 5, 2011 at 11:15 AM

I can’t find anywhere in the Constitution a provision which says that “mail must be delivered via the most inefficient and expensive means ever conceived by man using only 17th century technology“.

The problem could be solved without departing from the Constitution by simply allowing mail pick-up and delivery functions to be accomplished by the most efficient bidder under contract with a “lean and focused” supervisory US Mail agency.

landlines on September 5, 2011 at 5:02 PM

Article I, Section 8

The Congress shall have Power [...] To establish Post Offices and Post Roads;

So where, exactly, do you get the idea from that that “Congress is obligated to provide mail service under our Constitution?”

Congress isn’t “obligated” to do anything, except respect our God-given (or your favorite euphemism) rights, of which postal service is not one.

The same article says “Congress shall have Power [...] To grant letters of Mark and Reprisal.” Is the government’s modern lack of support for bounty hunters a travesty to our Constitution?

HitNRun on September 5, 2011 at 5:06 PM

I can’t get a read on you between this post and the later one you make about the European socialists not being an answer for Conservatives. People lose jobs daily that have nothing to do with unions, and they are after all a European socialistic kinda answer to life. Is there something about the breed of believing and support all union tactics that mean a person won’t grow up, grow a pair, and gt on with life without unions?

Just wondering.

Noelie on September 5, 2011 at 3:42 PM

To me it’s about free enterprise. The employer will offer as little as possible and the worker will try to get as much as possible.

There’s nothing Socialistic to me about workers organizing in order to try to get what they want…unless the government gets involved and forces workers to join (closed shop deals). It’s not un-American. Americans have banded together for mutual gain from Lexington Green, to the Alamo, to farmer cooperatives, to the Labor Movement, to the Bonus Army, to the TEA Party.

The Socialists want to control government and change society. The average worker only wants more pay, benefits, and job security. Many would point out that the Socialists long ago infiltrated the American Labor Movement. Surely. But look who’s in the White House and Congress, the courts, some major banks, corporations and so on. It’s not just the Labor Movement that’s been infiltrated.

As for European mail delivery, to me contracting with a company to run such a service and then control their activities is Socialism. One could make the argument that any government entity is Socialistic, or that any organization is as opposed to doing something entirely on your own. A rational person would look it as a matter of degrees and whether or not such a government function is pre-or post-Marx. I believe Benjamin Franklin was pre-Marx.

Dr. ZhivBlago on September 5, 2011 at 5:36 PM

Something I didn’t know until recently is that FedEx and UPS will drop off packages they don’t want to deliver because it would not be cost efficient to do so at the USPS and the Postal Service must deliver the package. Of course, FedEx/UPS pays the postage for the delivery but these are inefficient packages for the Post Office, too, (because they go to out of the way places). Thing is, the Post Office is not allowed to refuse a package even if it comes from one of their competitors and is being dropped off solely to save the competitor some money. So the “monopoly” can (and does) both help and hurt the bottom line.

jdp629 on September 5, 2011 at 6:22 PM

The Teamsters have a lot of money, let them start a business and compete with U.S. Steel, General Motors, Ford Motor Company, Apple, or whoever they believe is screwing them. Let them start a business and hire union workers and compete in the real world, not only in the U.S., but also on the world market with the Chinese.

bflat879 on September 5, 2011 at 6:29 PM

The Teamsters have a lot of money, let them start a business and compete with U.S. Steel, General Motors, Ford Motor Company, Apple, or whoever they believe is screwing them. Let them start a business and hire union workers and compete in the real world, not only in the U.S., but also on the world market with the Chinese.

bflat879 on September 5, 2011 at 6:29 PM

That’s a damn good point.

On the other hand, the Chinese and illegal immigrants make it so that the aforementioned companies don’t have to pay as much to get their products made and shipped. Only does us good on the consumer end when we buy the stuff…hurts our ability to buy in the first place.

We won’t know for some years if we’re stuck with 20% real unemployment and a sick economy along with creeping Socialism forever. If the Republicans take over next year and it all still sucks years on, then we’ll know…assuming the Republicans take the measures we here believe they should to attempt to restore the economy.

Dr. ZhivBlago on September 5, 2011 at 7:06 PM

But if some private company, UPS, Fedex, or a newbie, takes over they’ll suddenly need a few of those jobless, won’t they.

The truth is that neither USPS or FedEx want to replace the postal service. Delivering mail to every address in the USA, every day, isn’t a lucrative, high margin business. Both of those companies have deferred when asked to bid on providing a mail service that parallels the USPS. It’s simply not a very good business to be in.

As for politicians, not even the GOP is anxious to see the USPS vanish. Postal delivery is a service that’s heavily subsidized by large, Democratic-leaning cities to the benefit of everyone else, especially rural America. The cost of delivering mail to a resident of a large city is far, far lower than the cost of mail service to a family in rural Kansas. Yet the fixed priced model of first class mail ensures that everyone pays the same price. GOP Congressmen don’t want to tell Grandma that she deserves to pay $1.25 for mailing a letter to her family, or that her Netflix and magazine subscription rates must go up by 50%, because that’s the most ‘efficient’ price determined by the market.

Some weeks ago we had a thread here about how the Europeans handle mail delivery. Really? So the European Socialists are the new standard for American Conservatives? I’m sure Michael Moore would feel right at home here on this issue.

European mail carriers have expanded into other lines of business in order to remain solvent or even reach profitability. Business Week and Forbes have both run articles comparing our failing system to thriving European mail carriers. There’s actually no correlation between a national postal service’s level of unionization and its profitability. That’s a red herring.

bayam on September 5, 2011 at 7:10 PM

We won’t know for some years if we’re stuck with 20% real unemployment and a sick economy along with creeping Socialism forever. If the Republicans take over next year and it all still sucks years on, then we’ll know

It’s been sucking for the last decade plus, you should be able to realize that it’s not going to change overnight. If you read the minutes of the Fed or even read Barron’s, you don’t hear economists blaming the bad economy on ‘socialism’. It’s a rationalization used by people who don’t understand what happened in 2008 and what has been occurring in this country after the US decided to embrace ‘free trade’ with China that started to de-industrialize the US.

bayam on September 5, 2011 at 7:15 PM

We won’t know for some years if we’re stuck with 20% real unemployment and a sick economy along with creeping Socialism forever. If the Republicans take over next year and it all still sucks years on, then we’ll know

It’s been sucking for the last decade plus, you should be able to realize that it’s not going to change overnight. If you read the minutes of the Fed or even read Barron’s, you don’t hear economists blaming the bad economy on ‘socialism’. It’s a rationalization used by people who don’t understand what happened in 2008 and what has been occurring in this country after the US decided to embrace ‘free trade’ with China that started to de-industrialize the US.

bayam on September 5, 2011 at 7:15 PM

I have little doubt that the economic collapse is systemic in nature, but I do have some doubt. That is, if we can try what the TEA Party wants and it doesn’t work anyway, then I’ll know. Surely the ideologues will blame their enemies no matter what, the way the Libs are still blaming President Bush and the Republican Congress.

Note that those of us paying attention on the Republican side were not enchanted, shall we say, with the bloated Federal budget under them, even if you were to ignore Iraq and Afghanistan…then there was the TARP bail out also.

I still tend to peg the mortgage crisis due to Congressional interference as the main straw that broke the camel’s back, but I’ll agree that the camel’s back was already weak to begin with.

As far as China, I seem to remember all that taking off way back in the late ’80s under the Bush, Sr. administration and picking up steam under the Clintons.

Quite a quandary for free market types…support measures which make companies more profitable, but to the detriment of their own paychecks, businesses, and the ever-looming prospects of higher taxes, lower incomes, and inflation.

Dr. ZhivBlago on September 5, 2011 at 7:40 PM

European mail carriers have expanded into other lines of business in order to remain solvent or even reach profitability. Business Week and Forbes have both run articles comparing our failing system to thriving European mail carriers. There’s actually no correlation between a national postal service’s level of unionization and its profitability. That’s a red herring.

bayam on September 5, 2011 at 7:10 PM

Interesting.

But I would argue that what the system pays out compared to what they take in would have to be an issue, thus the level of unionization, or more accurately, how costly the union-negotiated benefit packages are along with pay. It’s easier to give than to receive in such situations, so in a failing economy the strain on government revenues coupled with not scaling back those pay and benefit items leads to the situation we’re seeing here.

I don’t expect government agencies to be profitable, but I expect them to be well-managed and their employees reasonably compensated. Of course if a business has no profit motive, they’ll quit whatever it is they’re doing. That, to me, is the danger with privatizing too many traditional government functions.

Dr. ZhivBlago on September 5, 2011 at 7:46 PM

If there was ever a prime time candidate for privatization . . .

Pablo Snooze on September 5, 2011 at 8:30 PM

Isn’t one of a postal worker’s perks free mail delivery? Conversation at a Thanksgiving meal between a family member who is a mail carrier and his wife reminding him to bring in the xmas cards for delivery. Never got it confirmed that what I was hearing was accurate.
Kind of like the report by the Daily Herald that tollway workers get to go through tolls for free,even when not working. Not sure if I heard all of that story there either.

journeyintothewhirlwind on September 6, 2011 at 8:06 AM

I pointed out that a strict constructionist would respect the idea that Congress is obligated to provide mail service under our Constitution.

MJBrutus on September 5, 2011 at 12:10 PM

Not exactly. The phrasing is:

The Congress shall have Power…To establish Post Offices and post Roads…

The phrasing is something that Congress can do, not must do. If these were duties and not powers, then Congress would be, for example, obligated to issue Letters of Marque even though there is a clear political decision to have our military handle such duties.

Similarly, a political decision can be made by Congress to abstain from using the power to establish Post Offices.

JohnTant on September 6, 2011 at 9:28 AM

JohnTant on September 6, 2011 at 9:28 AM

…or, what a bunch of people said earlier. Gotta remember…read once, comment once. Doh.

JohnTant on September 6, 2011 at 9:30 AM

When I was a kid I recall our mailman drove his own car and parked it at the end of the streets he would be delivering.

Now I note they all drive those specially made dorkmobiles. So now a post office has to have at least double the parking space to accomodate all the vehicles.

They used to walk from door to door. They sort of knew what was going on in the neighborhood.

Now they have boxes at the end of the street. In Houston, if you knock down a house and replace it, the new house has to have its mailbox on the street while the existing neighbors have their old door slots and boxes near the door.

80% labor costs? pretty much just like your local municipality. Big pensions, fat bennies and little motivation to serve.

They must realize we are onto them. Notice the all out blitz by the left to defend public employees starting yesterday?

DanMan on September 6, 2011 at 11:34 AM

JohnTant on September 6, 2011 at 9:28 AM

And how post offices are supposed to work is completely un-addressed.

Congress could not establish post offices at all.

or Congress could simply set up regulations and responsibilities for mail transport and delivery, and leave the execution completely in private hands.

or Congress could establish post offices, but contact out the transport of mail between them to private parties.

LarryD on September 6, 2011 at 3:30 PM

I pointed out that a strict constructionist would respect the idea that Congress is obligated to provide mail service under our Constitution.

MJBrutus on September 5, 2011 at 12:10 PM

True. But can you point to the Article, Section and Clause that mentions the no-layoff clause, union organization, retirement benefits, delivery schedules, and restrictions against contracting it out competitively to private companies?

Those items are NOT protected, nor dictated, by the Constitution.

dominigan on September 8, 2011 at 12:08 PM

The Congress shall have Power…To establish Post Offices and post Roads…

The phrasing is something that Congress can do, not must do.

JohnTant on September 6, 2011 at 9:28 AM

Very good catch! +1000

dominigan on September 8, 2011 at 12:10 PM

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