3 ms·

In FY 2019 the USPS lost $3.4 billion excluding all Congressionally mandated expenditures[1]. In 2018 they lost almost $2 billion, also excluding mandatory expe

by magila 6y ago

In FY 2019 the USPS lost $3.4 billion excluding all Congressionally mandated expenditures[1]. In 2018 they lost almost $2 billion, also excluding mandatory expenditures. The USPS's precarious financial situation is not artificial, it's the result of a long term decline in mail volume as correspondence increasingly shifts to electronic systems. A nit: The postal service wasn't actually created in the Constitution. Congress is merely authorized to do so. [1] https://about.usps.com/what/financials/10k-reports/fy2019.pdf https://about.usps.com/what/financials/10k-reports/fy2019.pd... Page 18, labeled "Controllable loss".

mdrabla 6y ago
The artificial nature of the USPS's debt comes from the fact that congress passed an (unusual) requirement to make it prepay health & retirement benefits. "The debt it carried jumped from $7 billion in 2008 to $10 billion in 2009. At the end of 2019, the GAO calculated that the Postal Service had $160.9 billion in debt, $119.3 billion of which came from retiree benefits" https://www.washingtonpost.com/business/2020/04/15/postal-service-bailout-congress/ https://www.washingtonpost.com/business/2020/04/15/postal-se...
- unishark 6y ago
  I can't access the article, but don't postal employees get the same (unsustainable) retirement benefits as government employees? Of course the costs of those benefits are ballooning. The retirement age is far earlier than life expectancy; it's simple math. What alternative is proposed that would make it past a union sitting on 120B in benefit commitments already?
  - ardy42 6y ago
    > I can't access the article, but don't postal employees get the same (unsustainable) retirement benefits as government employees? Can you clarify? My understanding is that US Federal Employee retirement benefits (for new employees) have been comparable to private sector benefits since some point in the 80s, though existing employees at that time kept their old, more generous pension plan. I think this might be what I'm talking about: https://www.opm.gov/retirement-services/fers-information/ https://www.opm.gov/retirement-services/fers-information/
  - vel0city 6y ago
    It is not necessarily that the retirement benefits are so extreme, it is that the Post Office singularly has a requirement to pre-fund its retirement fund massively in advance. No other agency is required to do so. https://federalnewsnetwork.com/agency-oversight/2020/02/house-passes-smaller-usps-reform-bill-to-eliminate-pre-funding-benefits/ https://federalnewsnetwork.com/agency-oversight/2020/02/hous... The Postal Accountability and Enhancement Act has pretty much been at the core of why the USPS has had such extreme woes. https://en.wikipedia.org/wiki/Postal_Accountability_and_Enhancement_Act https://en.wikipedia.org/wiki/Postal_Accountability_and_Enha...
- bobcostas55 6y ago
  Unless you think the money to pay pensions will magically materialize out of thin air in the future, I don't see what's artificial about it. They have obligations to pay and recognize them.
  - ardy42 6y ago
    >> The artificial nature of the USPS's debt comes from the fact that congress passed an (unusual) requirement to make it prepay health & retirement benefits. > Unless you think the money to pay pensions will magically materialize out of thin air in the future, I don't see what's artificial about it. They have obligations to pay and recognize them. My understanding is every other entity that has similar obligations is allowed to pay them as they go.

by magila 6y ago

mdrabla 6y ago

The artificial nature of the USPS's debt comes from the fact that congress passed an (unusual) requirement to make it prepay health & retirement benefits. "The debt it carried jumped from $7 billion in 2008 to $10 billion in 2009. At the end of 2019, the GAO calculated that the Postal Service had $160.9 billion in debt, $119.3 billion of which came from retiree benefits" https://www.washingtonpost.com/business/2020/04/15/postal-service-bailout-congress/ https://www.washingtonpost.com/business/2020/04/15/postal-se...

unishark 6y ago
I can't access the article, but don't postal employees get the same (unsustainable) retirement benefits as government employees? Of course the costs of those benefits are ballooning. The retirement age is far earlier than life expectancy; it's simple math. What alternative is proposed that would make it past a union sitting on 120B in benefit commitments already?
- ardy42 6y ago
  > I can't access the article, but don't postal employees get the same (unsustainable) retirement benefits as government employees? Can you clarify? My understanding is that US Federal Employee retirement benefits (for new employees) have been comparable to private sector benefits since some point in the 80s, though existing employees at that time kept their old, more generous pension plan. I think this might be what I'm talking about: https://www.opm.gov/retirement-services/fers-information/ https://www.opm.gov/retirement-services/fers-information/
- vel0city 6y ago
  It is not necessarily that the retirement benefits are so extreme, it is that the Post Office singularly has a requirement to pre-fund its retirement fund massively in advance. No other agency is required to do so. https://federalnewsnetwork.com/agency-oversight/2020/02/house-passes-smaller-usps-reform-bill-to-eliminate-pre-funding-benefits/ https://federalnewsnetwork.com/agency-oversight/2020/02/hous... The Postal Accountability and Enhancement Act has pretty much been at the core of why the USPS has had such extreme woes. https://en.wikipedia.org/wiki/Postal_Accountability_and_Enhancement_Act https://en.wikipedia.org/wiki/Postal_Accountability_and_Enha...
bobcostas55 6y ago
Unless you think the money to pay pensions will magically materialize out of thin air in the future, I don't see what's artificial about it. They have obligations to pay and recognize them.
- ardy42 6y ago
  >> The artificial nature of the USPS's debt comes from the fact that congress passed an (unusual) requirement to make it prepay health & retirement benefits. > Unless you think the money to pay pensions will magically materialize out of thin air in the future, I don't see what's artificial about it. They have obligations to pay and recognize them. My understanding is every other entity that has similar obligations is allowed to pay them as they go.