Postal Service reports billions in losses

[Bad_Daddy 2,209]

http://news.yahoo.com/s/ap/20110510/ap_on_re_us/us_postal_problems

JENNIFER C. KERR, Associated Press – Tue May 10, 6:25 pm ET

WASHINGTON – The Postal Service is continuing to hemorrhage money, reporting a loss Tuesday of more than $2 billion over the first three months of the year and warning it could be forced to default on federal payments.

Such a default would not interrupt mail service to millions of Americans, but it could further hobble an agency struggling with a sharp decline in mail because of the Internet and a tough economy.

The agency says the $2.2 billion loss covers Jan. 1 to March 31, 2011 — sharply higher than the net loss of $1.6 billion for the same period last year. The post office also said it will have reached its borrowing limit, set by Congress, of $15 billion by the end of the fiscal year.

Unless Congress intervenes, the Postal Service said, the agency won't have the cash for certain payment to the government, such as billions for a trust fund to provide health care benefits for future retirees.

"The Postal Service continues to seek changes in the law to enable a more flexible and sustainable business model," said Postmaster General and CEO Patrick R. Donahoe. "The Postal Service may return to financial stability only through significant changes to the laws that limit flexibility and impose undue financial burdens."

Total mail volume, about 41 billion pieces, was down 3.1 percent for the January to March period, compared to the same time a year earlier, the Postal Service said. A modest increase in revenue from standard mail wasn't enough to offset the revenue loss from fewer pieces of first-class mail.

In the last three years, the agency has cut over 130,000 jobs. And it's making more cuts, with the elimination of about 7,500 administrative jobs in regional offices.

The Postal Service does not receive tax money for its operations.

[^_^ 5,021]

I wanted to send a document (single page) to India. I wanted to make sure it got there within 2-3 weeks. Fedex quoted me 65 USD for a service which would get it there in 10 days or so. USPS quoted me 95 cents for regular first class and 20 USD for priority international which also gets it there in 10 days or so.

65 vs 20.

Even accounting for some amount of profit on Fedex's part, that difference is significant. Of course they're losing money.

[Gary and Alla 3,694]

Big surprise. They need to try the proven government solution...cut services and raise prices.

[TBoneTX 46,116]

They need to try the proven government solution...cut services and raise prices.

Si, man. The next rate-increase will strictly be to buy more signs that say "this window closed."

[Gary and Alla 3,694]

Si, man. The next rate-increase will strictly be to buy more signs that say "this window closed."

After living in Ukraine, I do not complain about the mail service here, in terms of being reliable and getting things delivered, but as a business, government run agencies really suck.

[Brother Hesekiel 2,236]

If USPS were a business, it would just cut mail delivery to rural areas or make it so expensive that it works for a business. A business would never build a bridge, unless it could make money off of it, i.e., by charging toll from everyone who ever wants to pass it as long as humans walk the Earth. A hospital purely run as a business would never provide emergency services to the poor or uninsured, because it makes no sense, business wise. If our school system were a business, they would have to charge about $11K per student per year. And if police and fire departments were businesses, like it's the case with health care in this country, you'd call 911 and would have to provide your membership number first or watch your house burn to the ground.

Even in a capitalist society, we need some institutions that provide services for all people equally. Given that I get several hundred spam e-mails per day, every day, about 100,000 a year, I had no problem if the US government implemented a 1 cent charge for e-mails and uses this money to help out the USPS. I don't mind paying a few cents per month with my phone bill, and it would stop the ridiculous Viagra, make my ####### larger, get your university diploma, get rich free, meet Russian woman spam a thing of the past. It's a win-win situation as far as I'm concerned.