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After Losing Nearly $4 Billion Last Year, Postal Service on Track to Lose $7 Billion This Year




The Postal Service used to lose money slower. Eric Boehm writes:

The U.S. Postal Service lost more than $2 billion during the second quarter of the fiscal year, putting it on track to finish the current year more than $7 billion in the red—way worse than the nearly $4 billion in losses it posted last year.

In its quarterly fiscal report, published today, the Post Office reported small decreases in mail volume and overall revenue compared to the same quarter of 2018. Its big losses are driven by a sharp increase in expenses, primarily workers’ compensation costs, pension liabilities, and payments for retirees’ health benefits.

For the fiscal year that ended on September 30, 2018, the Postal Service recorded a then-record loss of $3.9 billion. At the time, Postmaster General Megan Brennan bluntly declared that the agency “cannot generate revenue or cut enough costs to pay our bills” and predicted that the agency would continue to post losses at “an accelerating rate.”

After losing $1.5 billion in the first quarter of the current fiscal year, the Post Office has now lost $3.6 billion in just six months. That comes even after an increase in the cost of sending first-class mail. The cost of a stamp jumped 5 percent on January 1, and other mailing services increased by 2.5 percent. The agency predicted that those changes would increase revenue by $1.7 billion—but expenses have been outpacing revenues by a wide margin.

It’s not exactly news that personnel costs are driving the Postal Service’s financial problems. The agency has $100 billion in unfunded pension liabilities and “no clear path to profitability,” according to a White House assessment report released last year. The Post Office has lost $69 billion since 2007, and it probably would have gone bankrupt long ago if it were a private entity—FedEx and UPS certainly wouldn’t exist today if they were posting annual losses of $4 billion. And they pay taxes, which the Postal Service does not.

[Eric Boehm, “After Losing Nearly $4 Billion Last Year, Postal Service on Track to Lose $7 Billion This Year,” Reason, May 10]


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  1. It has never been worse. Customer service at the local Post Office is abysmal. To balance the budget, the USPS is using “flex workers” as mail carriers, which is why I spend my afternoons returning mistakenly delivered mail, put in my mailbox by error, to my neighbors. Recently, it took eleven days to deliver a letter mailed to the city from a nearby suburb.

  2. The post office has become a jobs program that needs to be modernized and downsized.
    Mail delivery has dropped by 80% with the bulk of mail being advertisements. The government is not here to help companies advertise.
    We now have email, fax, online banking, Amazon, federal express, UPS, and other services that are private to deliver mail and packages cheaper and more efficiently.
    Good bye U.S. Postal Service, it was nice to know you but we really don’t need you anymore.

  3. Every spring I send out hundreds of tree scions to interested parties. They weight far less than an ounce. I go to the post office and they tell me it is a package, needs special wrapping, special tape etc and that single scion costs me $3.50 to send. I go to the UPS store and it costs me $1.35. Guess who gets my shipping business?
    Secondly the UPS employees look like a diversity poster with every degenerate culture represented and none of them assimilated into the mainstream. Are you telling me you could not find some decent real American to fill those jobs over some Muslim wearing a head dress or some weirdo wearing a robe or covered in tattoos? Almost all of them have an attitude. I go to the UPS store and there are nice clean people there, dressed neatly who eagerly wait on me.

  4. The main problem with the post office is administration. Too many administrators. This includes Congress. Regulations are more important than delivering the mail.
    Not every city, town and village needs a post office.
    The worker are good. Yet they are stuck with bad administration.
    Love Saves Lives
    Carl Lambrecht