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Just a reminder that the bill that destroyed the USPS finances was backed by both Democrats and Republicans in 2005. It required the post office to fund pension

by erentz 7y ago

Just a reminder that the bill that destroyed the USPS finances was backed by both Democrats and Republicans in 2005. It required the post office to fund pensions and health care 75 years in advance as an intentional way to screw up their finances and make it insolvent. It passed unanimously in the Senate and every Democrat in the House voted for it. It’s truly been a bipartisan effort. http://clerk.house.gov/evs/2005/roll430.xml http://clerk.house.gov/evs/2005/roll430.xml The USPS is a vital service, note “service”. It is not a corporation designed to make money. It has mandates to deliver and pick up mail from every home in the US no matter where they are 6 days a week. It is a part of our infrastructure as much as the military or coast guard or national parks service or so on.

cosmie 7y ago
This. The fundamentals of the USPS are fine, they're only struggling artificially due to being placed in an impossible situation by Congress[1]. The short of it: 1. Congress required the USPS to fully pre-fund their retirement benefits (pension and healthcare obligations). A requirement Congres has neither placed on the public sector nor any other organization under Congressional control. 2. USPS pricing is controlled by Congress. Congress has refused to increase postage prices to allow for funding the above mandate. 3. USPS can't reconcile the two above line items, and continually defaults on a large chunk of their pension obligations each year. 4. #3 becomes periodic media and political fodder to push an agenda at privatizing the USPS (or filler for a slow news day). [1] https://ips-dc.org/how-congress-manufactured-a-postal-crisis-and-how-to-fix-it/ https://ips-dc.org/how-congress-manufactured-a-postal-crisis...
- wahern 7y ago
  Private companies are required to fully fund pension plans under Federal law. What's specific to the USPS is the requirement to fully fund health care benefits and, more importantly, a restriction preventing the USPS from lowering health benefits for existing retirees.[1] Unlike pensions, health care benefits are normally not considered vested benefits and so when faced with the USPS' dilemma any other organization, public or private, would simply lower health benefits. The USPS is being screwed, but it's more complicated than the memes thrown around in public discourse. Your link doesn't give enough context necessary to debunk many of those memes and to resolve the confusion. [1] Also the Treasury bond thing, but that's not nearly as much an existential burden as health benefits.
soldierof4chan 7y ago
People that keep repeating this conspiracy theory have no idea what they're talking about. While it's true that the PAEA (The bill in question) was passed unanimously, the PAEA does not require funding retiree health and pension funds "75 years into the future". You can read the bill itself [1] and see that this appears nowhere in it. What it actually requires is that the USPS fund the discounted present value of current employee retirement health and pensions liability. What this conspiracy theory also critically misses is that the Post Office hasn't contributed to the fund in a decade but still pays current retirees out of the fund. With more money leaving the fund than entering it, it is expected to be depleted by 2030 [2]. 1. https://www.congress.gov/bill/109th-congress/house-bill/6407 https://www.congress.gov/bill/109th-congress/house-bill/6407 2. https://www.gao.gov/products/GAO-18-602 https://www.gao.gov/products/GAO-18-602
- wahern 7y ago
  > Post Office hasn't contributed to the fund in a decade To be clear, there are two funds: pension and health benefits. AFAIU the USPS has been making progress on fully funding the pension plan. The health benefits fund is a lost cause because health costs are rising far too fast. Also, unlike with pensions most organizations (public and private) are permitted to decrease health benefits for existing retirees as they're not considered vested benefits, but under Federal law the USPS specifically is not permitted to lower health benefits for retirees. The USPS is really over a barrel in that regard, and that's why they don't bother--that and the hope that healthcare reform will have shifted the costs enough that some day the USPS-specific restriction will be lifted. Given their situation what they're doing does make sense--retirees have Obamacare, but nothing exists to replace lost pension income--it's just quasi-illegal. I say quasi because satisfying the health fund mandate is clearly impossible. It's worth repeating that the USPS doesn't control their rates, which are set by the Postal Regulatory Commission. The politics of the PRC are complicated[1] and they can't be expected to mitigate the funding dilemma created by Congress. Only Congress can fix things. But that won't happen anytime soon as the fundamental issue implicates national healthcare policy.
- elipsey 7y ago
  That's not a conspiracty theory, just someone being wrong. :)

by erentz 7y ago

cosmie 7y ago

This. The fundamentals of the USPS are fine, they're only struggling artificially due to being placed in an impossible situation by Congress[1]. The short of it: 1. Congress required the USPS to fully pre-fund their retirement benefits (pension and healthcare obligations). A requirement Congres has neither placed on the public sector nor any other organization under Congressional control. 2. USPS pricing is controlled by Congress. Congress has refused to increase postage prices to allow for funding the above mandate. 3. USPS can't reconcile the two above line items, and continually defaults on a large chunk of their pension obligations each year. 4. #3 becomes periodic media and political fodder to push an agenda at privatizing the USPS (or filler for a slow news day). [1] https://ips-dc.org/how-congress-manufactured-a-postal-crisis-and-how-to-fix-it/ https://ips-dc.org/how-congress-manufactured-a-postal-crisis...

wahern 7y ago
Private companies are required to fully fund pension plans under Federal law. What's specific to the USPS is the requirement to fully fund health care benefits and, more importantly, a restriction preventing the USPS from lowering health benefits for existing retirees.[1] Unlike pensions, health care benefits are normally not considered vested benefits and so when faced with the USPS' dilemma any other organization, public or private, would simply lower health benefits. The USPS is being screwed, but it's more complicated than the memes thrown around in public discourse. Your link doesn't give enough context necessary to debunk many of those memes and to resolve the confusion. [1] Also the Treasury bond thing, but that's not nearly as much an existential burden as health benefits.

soldierof4chan 7y ago

People that keep repeating this conspiracy theory have no idea what they're talking about. While it's true that the PAEA (The bill in question) was passed unanimously, the PAEA does not require funding retiree health and pension funds "75 years into the future". You can read the bill itself [1] and see that this appears nowhere in it. What it actually requires is that the USPS fund the discounted present value of current employee retirement health and pensions liability. What this conspiracy theory also critically misses is that the Post Office hasn't contributed to the fund in a decade but still pays current retirees out of the fund. With more money leaving the fund than entering it, it is expected to be depleted by 2030 [2]. 1. https://www.congress.gov/bill/109th-congress/house-bill/6407 https://www.congress.gov/bill/109th-congress/house-bill/6407 2. https://www.gao.gov/products/GAO-18-602 https://www.gao.gov/products/GAO-18-602

wahern 7y ago
> Post Office hasn't contributed to the fund in a decade To be clear, there are two funds: pension and health benefits. AFAIU the USPS has been making progress on fully funding the pension plan. The health benefits fund is a lost cause because health costs are rising far too fast. Also, unlike with pensions most organizations (public and private) are permitted to decrease health benefits for existing retirees as they're not considered vested benefits, but under Federal law the USPS specifically is not permitted to lower health benefits for retirees. The USPS is really over a barrel in that regard, and that's why they don't bother--that and the hope that healthcare reform will have shifted the costs enough that some day the USPS-specific restriction will be lifted. Given their situation what they're doing does make sense--retirees have Obamacare, but nothing exists to replace lost pension income--it's just quasi-illegal. I say quasi because satisfying the health fund mandate is clearly impossible. It's worth repeating that the USPS doesn't control their rates, which are set by the Postal Regulatory Commission. The politics of the PRC are complicated[1] and they can't be expected to mitigate the funding dilemma created by Congress. Only Congress can fix things. But that won't happen anytime soon as the fundamental issue implicates national healthcare policy.
elipsey 7y ago
That's not a conspiracty theory, just someone being wrong. :)