The U.S. Postal Service, the model for our future National Health .Care System, continues to make news. For the fiscal year ending September 30, the USPS reported a net loss of $3.8 billion. It estimates that its losses for the year 2010 will be double that. This, after it cut back work hours by 115 million and instituted other cost-cutting measures.
The immediate cause of the massive losses was a continuing drop in the amount of mail. In the year just ended, mail volume dropped by 13% compared to the year before – 26 billion fewer pieces in all. Of course, the cause of that massive decline was the increasing ease of use of email and instant messaging, and the perennial difficulty of use of the average post office.
Now, the USPS cannot be given tax dollars in direct sup- port, nor can it go bankrupt unless the feds decide to let it. It can ask Congress to allow it to raise postage rates, but that risks driving away users and further driving down the volume of mail – and Congress increased those rates just recently anyhow.
That leaves borrowing. The USPS can borrow up to $3 bil- lion a year, up to a cap of $15 billion. Its current debt is $10.2 billion. So with the $3 billion it will have to borrow to cover last year’s deficit, it will be near the limit. And it will be unable
to meet next year’s obligations, absent an increase in the cap, or the discovery of another fix.
The USPS has suggested one: it wants the government to lift its mandate to supply its pension fund with $5 billion a year. (This past year, the feds waived the mandate.) Of course, if the USPS is allowed to underfund its pension plan, then tax- payers will have to pay the pensions if the USPS defaults.
So the “solutions” to the USPS nose dive take the form of sticking it to the taxpayer, directly or indirectly, now or later. But there is a more obvious solution. Simply end the
monopoly the USPS has on the delivery of first-class mail, immediately end all its direct or indirect government sup- port, let it charge whatever the hell it wants for whatever services it wants to offer, and let it sink or swim. But that seems to be beyond anything the swell-heads in government can imagine.