View Full Version : Post Office Loosing Money? Yeah Right
According to Bob Sullivan in a recent msnbc.com article (http://redtape.msnbc.msn.com/_news/2011/10/07/8191425-twisted-government-accounting-behind-postal-service-woes), Post Office profits are actually being used to bail out the US Government. Tricky Washington accounting practices only make the Post Office look like its broke.
Go figure.
theoilman
10-07-2011, 14:59
What about the idea that mail is only postmarked in major hubs and all mail has to be hauled there?
For example, if you mail a 1st class letter local in many small towns, it has to be trucked to a larger town/small city (up to 100 miles each way, possibly more), then put on a semi to be hauled another 200 miles just to be postmarked. Trucked back the 200 miles, catch another truck to go back to the original small town for delivery.
That 1 ounce letter has now traveled on at least 4 contracted haul trucks and traveled 600 miles just to nowhere local, but the local post office is not allowed to postmark it and send it straight back out.
hikerboy57
10-07-2011, 15:45
According to Bob Sullivan in a recent msnbc.com article (http://redtape.msnbc.msn.com/_news/2011/10/07/8191425-twisted-government-accounting-behind-postal-service-woes), Post Office profits are actually being used to bail out the US Government. Tricky Washington accounting practices only make the Post Office look like its broke.
this is a bit deceptive, in that their retirees get paid by the federal govt, so legacy costs , health insurance, etc. for USPS workers isnt included in this "profit" statement. as noted in the subsequent post, you cant truly beleive this is an efficient way to move mail, do you?
Personally I would prefert they just raise rates again,rather than cut back services and hours. as .43 to send a letter across the country is a bargain.
The Cleaner
10-07-2011, 15:55
Say it ain't so the government would never lie,only strech the truth really thin or crunch numbers so small you don't see the decimal points....lololololol....
Keep in mind that the Post Office for years has been an independent agency that has only the money it takes in. The change to independence means the post office no longer gets taxpayer subsidies. and hasn't for a long time. Its present woes have nothing to do with cooked books, only a loss of business as a result of free internet competition, and onerous regulations imposed by Congress, when it couldn't bring itself to allow complete independence.
Congress didn't want to have to appropriate money. But members also didn't want to totally eliminate their right to meddle on behalf of constituents, you know people like you and me.
The post office is trying to provide more service than their customers need. Ask yourself if you absolutely need delivery six days per week? I get paid every two weeks. Do I need twelve days of bill delivery? 95% of my mail is junk. I think two days is more than enough each week.
Pedaling Fool
10-07-2011, 22:04
Keep in mind that the Post Office for years has been an independent agency that has only the money it takes in. The change to independence means the post office no longer gets taxpayer subsidies. and hasn't for a long time. Its present woes have nothing to do with cooked books, only a loss of business as a result of free internet competition, and onerous regulations imposed by Congress, when it couldn't bring itself to allow complete independence.
Congress didn't want to have to appropriate money. But members also didn't want to totally eliminate their right to meddle on behalf of constituents, you know people like you and me.
It's not completely independent, as you later noted in your post. Probably time to do away with this thing, or at least completely separate them form the govt. Just another example that a govt is no good at running a buisness.
The post office is trying to provide more service than their customers need. Ask yourself if you absolutely need delivery six days per week? I get paid every two weeks. Do I need twelve days of bill delivery? 95% of my mail is junk. I think two days is more than enough each week.
if you cut down on mail delivery it back up on both ends then they have to work 3 days overtime no saving there
4eyedbuzzard
10-07-2011, 22:15
Congress once again screws the pooch. They tell the USPS what they can charge, fully knowing they can't operate at break even at legislated rates. Congress passed legislation regarding pension and health benefits programs funding, that in some cases funds these benefits for people they haven't hired yet, and are unlikely to ever do so. It's absurd. If USPS was disbanded tomorrow, there is no private business model that would come close to current rates. UPS, Fedex, or anyone else simply can't come up with a business model to deliver letters for 44 cents - I'd be shocked if they could do it at $1.00. Yet based on current 1st class mail volume, the "deficit" would not exist if 1st class letter rates were raised to 50 cents. Food for thought.
Some of the most important things governments exist for are to establish and maintain defense, currency / banking, and postal systems. Our recent government leaders seem to want to ruin the ones left it by the 200+ years of government that preceded it.
if you cut down on mail delivery it back up on both ends then they have to work 3 days overtime no saving there
Then you have the problem of where to store the mail...if you're only delivering a couple times a week, like you say it will back up, where will they put it?
That is absolutely not true 4eyedbuzzard...Fed Ex and UPS would jump at the opportunity to compete with the USPS in carrying first class mail...several years ago Fed Ex said they could do it for only 25 cents a letter, which was substantially less than the price of a stamp at that time.
Fed Ex and UPS already do long haul shipping for most of the USPS's priority and express mail packages, and some of its first class mail...the USPS only delivers to your door.
The difference is that postal employees are paid much higher wages and have much more expensive health care and retirement programs...those are the things driving the cost of a stamp up, and have been for years. The USPS couldn't compete if they didn't have a legal monopoly on first class mail to keep them afloat...competition would drive the price of a stamp far below where it is today.
Perennial
10-08-2011, 08:48
if you cut down on mail delivery it back up on both ends then they have to work 3 days overtime no saving there
This is exactly right. As a former postal employee I don't propose to know what it's going to take to 'fix it', but there's much more to it than meets the public eye. They would not have enough storage space for all the mountains of mail that would pile up if delivery is cut back to 2-3 days a week.
The post office has lost 20% of its volume from 2006 (213 billion pieces) to 2011 (170 billion pieces). The number of full time employees is not 20% down. I searched for a while but could not find any statistics. I am not bashing the USPS because it is the only organization that delivers to everyone in all areas. UPS and FEDEX piggyback deliveries onto Postal service trucks in very rural areas. The postal service also piggybacks on UPS and FEDEX trucks. All three organizations cannot live without each other.
The USPS has almost double the cost percentage for labor compared with UPS and FEDEX. This shows that the cost structure is not working. Blame the low cost of a stamp, but don't forget to blame the poor job of negotiating contracts with the labor unions. Look at GM for another great example of destroying your business through poor negotiating skills. Any business that guarantees no lay-off's in a contract is asking for trouble.
It would be interesting to see the number of postal service employees year by year from around 1960 to 2011. In the 60's mail was hand sorted and now done by machine. Has the postal service become more efficient (Pieces of mail per employee) or less efficient. I am guessing less.
We still need the postal service for the future. They just have to figure a way to become leaner and more efficient in order to save a system everyone needs.
Chubbs4U
10-08-2011, 12:12
This is exactly right. As a former postal employee I don't propose to know what it's going to take to 'fix it', but there's much more to it than meets the public eye. They would not have enough storage space for all the mountains of mail that would pile up if delivery is cut back to 2-3 days a week.
Maybe this would cut the 70% or so of junk mail that we get. I personally dont understand how a business could be running in the red for so long. I also have had many more bad experiences with the postal service than good ones, very few post offices that the people are helpful and friendly.
LIhikers
10-09-2011, 13:03
Do away with the USPS and my bet is that you would be doing away with general delivery, which enables bounce boxes and mail drops for hikers.
Rocket Jones
10-09-2011, 18:03
If true, they need to bail faster.
Then you have the problem of where to store the mail...if you're only delivering a couple times a week, like you say it will back up, where will they put it?
Since the mail volume is down 20%, there should be about 20% more storage space somewhere.
Panzer
Maybe this would cut the 70% or so of junk mail that we get. I personally dont understand how a business could be running in the red for so long. I also have had many more bad experiences with the postal service than good ones, very few post offices that the people are helpful and friendly.
Junk mail is important to the post office... Without the income from junk mail the cost of a stamp would soar.
Panzer
Since the mail volume is down 20%, there should be about 20% more storage space somewhere.
Panzer
My point is that they don't normally store mail at all...it is constantly being sorted or in transit...if the system stops running it backs up everywhere and there is nowhere to put it. I guess to an extent you could leave it in the trucks they are using to ship it, but I don't think that would be a complete solution.
earlyriser26
10-10-2011, 05:19
Maybe the problem is that you are getting your "news" from MSNBC. The post office is broke and it it is not fancy accounting. The combination of less snail mail thanks to the internet and public employee salaries / pensions has made the entire system unworkable. My brother retired at age 50 from the post office, NICE! He had to wait in line for years to get the job. Why did he have to work so hard to get the job, because the pay and benefits were so much higher than the private sector. Reduce the pension levels to the private sector level, cut out Saturday delivery or even just deliver it M, W, F. If bills come only 3 days a week will anyone care?
I am now paying most of my bills online thru my bank's website. That's about 8-10 bills a month that I used to send thru snail mail.
Also business are sending me junk email. Without junk email, they would be foced to send it thru snail mail.
So there is all that less mail going thru the post office.
Panzer
LIhikers
10-10-2011, 23:13
My local post office has a sign that says it's U.S. Federal Property, no trespasing. So if the post office buildings and property are government owned, the government sets the rates, and the government provides the pensions, how can it be an independent organization?
Fireweed
10-11-2011, 15:54
If they close on Saturday it's going to hurt the planning of bounce boxes and resupply. But, then it doesn't always work out when they are open.
Chaco Taco
10-11-2011, 15:58
loads of them are closing, Glencliff included.