Congress Is Putting U.S. Postal Service Out Of Business

By Jeff Mitchell, publisher

Remember the old phrase the US Postal Service used to use: “Neither snow, nor rain, nor heat, nor gloom of night, stays these courageous couriers from their swift completion of their appointed rounds.” While this still holds true in most cases, the U.S. Postal Service has been slow to change and adapt to present-day economics and technology and may be filing for bankruptcy come next September if Congress doesn’t wake up to reality.

In just the past year, the post office has lost $5.1 billion, mainly due to a decrease in first class mail, but also due to the fact it has to fund future retiree medical benefits years in advance; losses for 2012 could exceed $14 billion.

Congress has been slow to act to give the agency the flexibility to reduce the number of days of delivery, to close underperforming offices, raise prices, reduce health care and other labor costs, which are 80 percent of the USPS costs. The postal service needs to be self-sustaining because it’s an independent agency of the government and does not receive tax money for its operations.

For many years the postal service did very little self-promotion but has recently stepped up its advertising. The problem is too little too late and the message is weak. The post office has failed to capitalize on its strengths: the experience of receiving and opening a letter or card (as opposed to digital) and the one size box that ships anywhere in the U.S. for one price, or leasing space to a card shop for instance. UPS and FedEx have continued to post profits even in the current economy, whereas the postal service wallows in huge losses. Routes are being consolidated, retired employees are not being replaced and service is suffering. The postal service is on life support and, without a heart transplant and forward thinking, the post office will soon be extinct.