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> onerous regulations (retirement prefunding requirements, etc.) that have drastically impaired the USPS. Onerous regulations? They are just being asked to ac

by pravda 8y ago

> onerous regulations (retirement prefunding requirements, etc.) that have drastically impaired the USPS. Onerous regulations? They are just being asked to act like every other company. If you want to offer pensions, fine, but you have to have a funded pension plan.

deleted 8y ago
[deleted]
Bluestrike2 8y ago
Companies and government agencies generally don't prefund retirement healthcare benefits to 100%. Rapid USPS funding requirements starting 2007 were frontloaded for the first ten years. And while there are arguments for prefunding versus a pay-as-you-go approach with current retirees, it's a balance between short-term liquidity and long-term benefits.[0] Per the Postmaster General's testimony in 2017: > Our significant financial losses are due in large part to the legally mandated RHB prefunding requirement. Such a requirement to prefund retiree health care obligations is not imposed on most other federal entities or private-sector businesses that offer retiree health benefits, let alone on an accelerated basis. The Postal Service’s funded level for RHB far exceeds that of civilian federal government entities, state governments, and those private sector companies that offer retiree health benefits at all.[1] Changes in mailing behavior were worse than the USPS expected in 2006, and RHBF payments became much more of a problem than was initially expected. It's not so much that prefunding is bad per se, but that the requirements as enacted limited the USPS's liquidity and options. The USPS IG[2] also put out a white paper[3] on the subject that argues some of the assumptions behind the funding requirements. You'll find a range of arguments out there from suggesting that the only problem for the USPS is the impact of the RHBF payment requirements to them being just a symptom of broader problems, but but the GAO report on the subject is a pretty even-handed take on the subject.[4] 0. https://fas.org/sgp/crs/misc/R43349.pdf https://fas.org/sgp/crs/misc/R43349.pdf 1. https://about.usps.com/news/testimony/2017/pr17_pmg0207.htm https://about.usps.com/news/testimony/2017/pr17_pmg0207.htm 2. https://www.uspsoig.gov/blog/be-careful-what-you-assume https://www.uspsoig.gov/blog/be-careful-what-you-assume 3. https://www.uspsoig.gov/sites/default/files/document-library-files/2015/ft-wp-15-003_0.pdf https://www.uspsoig.gov/sites/default/files/document-library... 4. https://oversight.house.gov/wp-content/uploads/2014/03/Todisco-GAO-Statement-USPS-Unfunded-Liabilities-3-13.pdf https://oversight.house.gov/wp-content/uploads/2014/03/Todis...
- pravda 8y ago
  >Companies and government agencies generally don't prefund retirement healthcare benefits to 100%. So? Shouldn't all retirement healthcare benefits be prefunded? It makes no sense not to do so.
  - mmt 8y ago
    No sense for whom? With private companies, it makes great sense for stockholders or corporate executives trying to extract as much current value from the company as is legally allowed (or can get away with). Future value is of much less consequence to them. That's exactly why they have done so historically and continue to do so. With government agencies, the incentive is similar, in that prefunding means they have to public funds today. It's much more attractive to leave the problem for future politicians, literally decades later. However, if the USPS actually has to prefund its retirement plans, then it's fair to say that's an onerous regulation, compared with private industry, which doesn't, no matter how many "should"s you throw at them.

by pravda 8y ago

deleted 8y ago

[deleted]

Bluestrike2 8y ago

Companies and government agencies generally don't prefund retirement healthcare benefits to 100%. Rapid USPS funding requirements starting 2007 were frontloaded for the first ten years. And while there are arguments for prefunding versus a pay-as-you-go approach with current retirees, it's a balance between short-term liquidity and long-term benefits.[0] Per the Postmaster General's testimony in 2017: > Our significant financial losses are due in large part to the legally mandated RHB prefunding requirement. Such a requirement to prefund retiree health care obligations is not imposed on most other federal entities or private-sector businesses that offer retiree health benefits, let alone on an accelerated basis. The Postal Service’s funded level for RHB far exceeds that of civilian federal government entities, state governments, and those private sector companies that offer retiree health benefits at all.[1] Changes in mailing behavior were worse than the USPS expected in 2006, and RHBF payments became much more of a problem than was initially expected. It's not so much that prefunding is bad per se, but that the requirements as enacted limited the USPS's liquidity and options. The USPS IG[2] also put out a white paper[3] on the subject that argues some of the assumptions behind the funding requirements. You'll find a range of arguments out there from suggesting that the only problem for the USPS is the impact of the RHBF payment requirements to them being just a symptom of broader problems, but but the GAO report on the subject is a pretty even-handed take on the subject.[4] 0. https://fas.org/sgp/crs/misc/R43349.pdf https://fas.org/sgp/crs/misc/R43349.pdf 1. https://about.usps.com/news/testimony/2017/pr17_pmg0207.htm https://about.usps.com/news/testimony/2017/pr17_pmg0207.htm 2. https://www.uspsoig.gov/blog/be-careful-what-you-assume https://www.uspsoig.gov/blog/be-careful-what-you-assume 3. https://www.uspsoig.gov/sites/default/files/document-library-files/2015/ft-wp-15-003_0.pdf https://www.uspsoig.gov/sites/default/files/document-library... 4. https://oversight.house.gov/wp-content/uploads/2014/03/Todisco-GAO-Statement-USPS-Unfunded-Liabilities-3-13.pdf https://oversight.house.gov/wp-content/uploads/2014/03/Todis...

pravda 8y ago
>Companies and government agencies generally don't prefund retirement healthcare benefits to 100%. So? Shouldn't all retirement healthcare benefits be prefunded? It makes no sense not to do so.
- mmt 8y ago
  No sense for whom? With private companies, it makes great sense for stockholders or corporate executives trying to extract as much current value from the company as is legally allowed (or can get away with). Future value is of much less consequence to them. That's exactly why they have done so historically and continue to do so. With government agencies, the incentive is similar, in that prefunding means they have to public funds today. It's much more attractive to leave the problem for future politicians, literally decades later. However, if the USPS actually has to prefund its retirement plans, then it's fair to say that's an onerous regulation, compared with private industry, which doesn't, no matter how many "should"s you throw at them.