6 ms·

USPS doesn't technically need to be profitable. It's a service guaranteed by the Government. Government services do not need to turn a profit. Yes, currently t

by j_w 1y ago

USPS doesn't technically need to be profitable. It's a service guaranteed by the Government. Government services do not need to turn a profit. Yes, currently the service is expected to fund itself. This is short sighted and has progressively made one of the greatest public services worse.

giancarlostoro 1y ago
Sure, but then when something goes severely wrong, you wind up thinking of things to better fund USPS. I think USPS doesn't need to be aggressively profitable, but it should at least aim towards being as self-sufficient as reasonably possible. I don't see an issue with this.
- Goronmon 1y ago
  Sure, but then when something goes severely wrong, you wind up thinking of things to better fund USPS. This logic could be applied to literally anything, so your argument is effectively that the government should never fund anything. If there is a war, cancer/disease research is going to be less important, so the government shouldn't fund cancer/disease research. If suddenly a famine strikes, war is going to be less important, so the government shouldn't fund the military. If a sudden deadly disease arises, funding for food security/research is going to be less important, so the government shouldn't be funding any of that as well.
  - robertlagrant 1y ago
    You're straw-manning their argument to be much more all or nothing than it is. Definitely if there's a total war economy, there's going to be less money for other things, even if that thing is "keeping future inflation in the single digits".
    - potato3732842 1y ago
      Exactly. Nobody expects the welfare office to be self sufficient, what are they gonna do, charge all the recipients? But a mail and parcel service, something that the private sector does profitably, shouldn't be deeply in the red though a little from time to time is probably fine.
      - fragmede 1y ago
        On the other hand though, if the private parcel service had to fund 40 years of pensions instead of giving out 401k's, and were obligated to serve unprofitable routes, they'd be deeply in the red. It's not a remotely level playing field, so it's no wonder the government parcel service is having problems.
        potato3732842 1y ago
        I wouldn't consider the USPS to be deeply in the red when compared with other government operations.
        fragmede 1y ago
        deeply in the red is your phrase, not mine
        robertlagrant 1y ago
        > It's not a remotely level playing field What's causing the unlevel playing field?
        fragmede 1y ago
        Various acts of Congress that force them to take on a huge amount of debt and force them to run unprofitable routes. A private company has no such requirements.
        robertlagrant 1y ago
        Oh yes, true, the Post Office in the UK has the same burden. I more meant the pensions.
- fkyoureadthedoc 1y ago
  The downstream benefits of a well functioning USPS could be worth running it at a loss. If efforts to make it profitable make the service worse, then it could be a net negative.
- jgeada 1y ago
  And the perverse incentive of this direction of thinking is that when you elect people with this thought pattern they prove the point by sabotaging the service. Then they say "see, government is ineffective ", and either directly pocket the resulting money (corruption) or give it to their rich friends (oligarchy).
- fzzzy 1y ago
  You obviously haven't lived in rural america.
  - dfxm12 1y ago
    On a side note related to your comment, just one side benefit of urbanization would be more efficient delivery of services (including delivery services). Thankfully, the government guarantees it will deliver letters to some remote rural places at a price private companies can't touch, but we can do better to make life easier for everyone: the mail man, the people wanting their mail, etc.
    - fzzzy 1y ago
      I agree that urbanization makes delivery much more efficient. My point was that if USPS goes away, there are many areas of rural america that simply won't be served because it is too expensive.
orwin 1y ago
Could USPS offer limited check accounts and debit cards? I've been twice now in WV, in counties so far away from everything, the only government presence is USPS. The only proof you're in the modern US is USPS (and a bit further a weird, small public library near a weirder Dollar tree). Some people have trouble getting their retirement money, other are destitute who found a new, non-homeless life (but have trouble with debt collection or just lost their papers), And from what I've understood, USPS has buildings and employees present everywhere and is really trusted in those deep parts, more than anything the government does. Wouldn't offering basic banking (and maybe limited but free internet access) be a nice addition to help the poorest in the US? Just an idle thought I had for a while
- moduspol 1y ago
  I'm from WV. I always figured Wal-Mart would pick it up eventually, but I think there may be laws that make that difficult.
  - justin66 1y ago
    I imagine the question is how much money there would be in it for Wal-Mart.
    - jdeibele 1y ago
      A lot of stores in the US used to take payments for utility companies. The idea was that as long as you were there paying that, you'd be tempted to buy things from the store. Paying by check in the mail put a huge dent in this and then having the utility automatically debit your account pretty much put an end to it from what I've seen. I'm sure there are some areas where it still is a thing but they'd also have a high number of people without bank accounts. For a while, utilities would only debit checking accounts, presumably because ACH payments are so much cheaper than credit card ones. A few years, they opened up to credit card payments. There seem to be a lot of people who do everything on credit cards and they must have had to change with the times.
      - 1y ago
potato3732842 1y ago
>Yes, currently the service is expected to fund itself. This is short sighted I could not disagree more. While I agree they don't "need" to be profitable and we "could" just give them tax money the fact that they try to be in the face of competition and come pretty close to doing so despite some dumb requirements really results in an incentive structure that puts them head and shoulders above pretty much any other subsection of government one interacts with. So perhaps let's not remove the incentive for profitability. Edit: And before anyone tries to construe this as me advocating for privatization or anything else like that, I'm saying they're fine the way they are (on a macro level, I'm sure there's tons of individual items that could use refinement, like any organization) and ought to be a model for other government functions. >and has progressively made one of the greatest public services worse. What? Are you joking? Have you ever tried to do anything other than a bog standard transaction at the DMV or get anything beyond typical "homeowner pays professional to do typical thing" type work permitted? The USPS is one of the most user friendly services in existence even once you get off the beaten path of sending standardized envelopes and parcels. If you restrict the comparison to just federal services it's not even close except perhaps some very specific common workflows but even then when it goes off the rails it goes off the rails way harder and is way more painful to resolve. Ask anyone of social security age if you don't believe me.
kochb 1y ago
Either it is able to fully fund itself through sender fees and other operations, or the net losses are ultimately paid for by other government revenues, primarily taxes. I enjoy Christmas cards and personal letters as much as anyone, but with electronic payments and telecommunications taking more of the volume, it is increasingly becoming an advertising service. If it is operating unprofitably, we are paying a form of subscription fee to receive those ads.
- nxobject 1y ago
  More charitably, it's a cost-sharing scheme for last-mile delivery to rural communities and deep suburban sprawl – as, to be fair, is often true for other rural services with significant federal funding like healthcare and higher education.
  - dfxm12 1y ago
    At some point, we should do what we can to promote urbanization. Being able to deliver government services more efficiently is one benefit.
    - jermaustin1 1y ago
      A lot of the people who don't want to live in urban/suburban areas also view "government services" as a bad thing to begin with. Probably because they've never had good access to services.
      - dfxm12 1y ago
        I think they view government services as a bad thing for a few reasons, despite having access to good government services. These two stick out to me: The ubiquitous conservative media bombards them with lies about the quality, quantity and cost of these services, along with who receives the benefits. They also haven't taken a step back to consider all the things they enjoy that are provided as government services, like roads, police, education, subsidized mail delivery, unemployment, support for dairy products, etc.
TheJoeMan 1y ago
This creates a market discontinuity by the government that leads to abuse. Part of the reason for Amazon's dominance is that USPS undercharges for package delivery. When Amazon rolled out their own delivery service, they optimize delivering the "cheap" packages, and making USPS deliver the "expensive" out of the way packages, and due to flat-rates, USPS was in the red. USPS's solution? Keep squeezing grandma who wants to mail a few first-class letters a year.
- BenjiWiebe 1y ago
  Maybe in some places, but in our rural area (Durham, Kansas) 95%+ of Amazon packages are delivered by UPS.
kbolino 1y ago
It actually was profitable for most of its existence. It zealously guarded its monopoly on first-class mail because that's where the money came from. And it did so before it was spun out as a quasi-private entity. This is actually one of the challenges of public services in the US today; many things, from mail delivery to bus and train service to road construction and vehicle registration, were once self-sufficient but haven't been for a long time. There's a lot of reasons for this, but one of the outcomes is that entities which used to take care of themselves now have to beg for a growing portion out of the general fund. However, it's clear that the 1970s experiment to have it turn a profit again didn't work and likely never would have worked (it was, in many ways, set up for failure).
- jermaustin1 1y ago
  For the USPS, it would be profitable if it wasn't required to self-fund and pre-fund all retirement benefits for current and future employees 75 years in advance, paying for retirement health care for "workers" who aren't in the workforce, or even born yet. It was a political ploy to force the USPS into debt in 2006 with the Postal Accountability and Enhancement Act. No other federal agency or private sector business pre-funds its retirement benefits.
  - kbolino 1y ago
    That requirement was repealed in 2022. The USPS still isn't profitable. While it reaped the benefit of that repeal and reported only a small loss in 2022, it reported much larger losses in 2023 and 2024, comparable to its loss in 2021 (when the requirement was still in effect).
    - deleted 1y ago
      [deleted]
    - strongpigeon 1y ago
      Last quarter was slightly profitable [0], but yeah the losses in 2023 were pretty big. https://about.usps.com/what/financials/financial-conditions-results-reports/fy2025-q1.pdf https://about.usps.com/what/financials/financial-conditions-...

by j_w 1y ago

giancarlostoro 1y ago

Sure, but then when something goes severely wrong, you wind up thinking of things to better fund USPS. I think USPS doesn't need to be aggressively profitable, but it should at least aim towards being as self-sufficient as reasonably possible. I don't see an issue with this.

Goronmon 1y ago
Sure, but then when something goes severely wrong, you wind up thinking of things to better fund USPS. This logic could be applied to literally anything, so your argument is effectively that the government should never fund anything. If there is a war, cancer/disease research is going to be less important, so the government shouldn't fund cancer/disease research. If suddenly a famine strikes, war is going to be less important, so the government shouldn't fund the military. If a sudden deadly disease arises, funding for food security/research is going to be less important, so the government shouldn't be funding any of that as well.
- robertlagrant 1y ago
  You're straw-manning their argument to be much more all or nothing than it is. Definitely if there's a total war economy, there's going to be less money for other things, even if that thing is "keeping future inflation in the single digits".
  - potato3732842 1y ago
    Exactly. Nobody expects the welfare office to be self sufficient, what are they gonna do, charge all the recipients? But a mail and parcel service, something that the private sector does profitably, shouldn't be deeply in the red though a little from time to time is probably fine.
    - fragmede 1y ago
      On the other hand though, if the private parcel service had to fund 40 years of pensions instead of giving out 401k's, and were obligated to serve unprofitable routes, they'd be deeply in the red. It's not a remotely level playing field, so it's no wonder the government parcel service is having problems.
      - potato3732842 1y ago
        I wouldn't consider the USPS to be deeply in the red when compared with other government operations.
        fragmede 1y ago
        deeply in the red is your phrase, not mine
      - robertlagrant 1y ago
        > It's not a remotely level playing field What's causing the unlevel playing field?
        fragmede 1y ago
        Various acts of Congress that force them to take on a huge amount of debt and force them to run unprofitable routes. A private company has no such requirements.
        robertlagrant 1y ago
        Oh yes, true, the Post Office in the UK has the same burden. I more meant the pensions.
fkyoureadthedoc 1y ago
The downstream benefits of a well functioning USPS could be worth running it at a loss. If efforts to make it profitable make the service worse, then it could be a net negative.
jgeada 1y ago
And the perverse incentive of this direction of thinking is that when you elect people with this thought pattern they prove the point by sabotaging the service. Then they say "see, government is ineffective ", and either directly pocket the resulting money (corruption) or give it to their rich friends (oligarchy).
fzzzy 1y ago
You obviously haven't lived in rural america.
- dfxm12 1y ago
  On a side note related to your comment, just one side benefit of urbanization would be more efficient delivery of services (including delivery services). Thankfully, the government guarantees it will deliver letters to some remote rural places at a price private companies can't touch, but we can do better to make life easier for everyone: the mail man, the people wanting their mail, etc.
  - fzzzy 1y ago
    I agree that urbanization makes delivery much more efficient. My point was that if USPS goes away, there are many areas of rural america that simply won't be served because it is too expensive.

orwin 1y ago

Could USPS offer limited check accounts and debit cards? I've been twice now in WV, in counties so far away from everything, the only government presence is USPS. The only proof you're in the modern US is USPS (and a bit further a weird, small public library near a weirder Dollar tree). Some people have trouble getting their retirement money, other are destitute who found a new, non-homeless life (but have trouble with debt collection or just lost their papers), And from what I've understood, USPS has buildings and employees present everywhere and is really trusted in those deep parts, more than anything the government does. Wouldn't offering basic banking (and maybe limited but free internet access) be a nice addition to help the poorest in the US? Just an idle thought I had for a while

moduspol 1y ago
I'm from WV. I always figured Wal-Mart would pick it up eventually, but I think there may be laws that make that difficult.
- justin66 1y ago
  I imagine the question is how much money there would be in it for Wal-Mart.
  - jdeibele 1y ago
    A lot of stores in the US used to take payments for utility companies. The idea was that as long as you were there paying that, you'd be tempted to buy things from the store. Paying by check in the mail put a huge dent in this and then having the utility automatically debit your account pretty much put an end to it from what I've seen. I'm sure there are some areas where it still is a thing but they'd also have a high number of people without bank accounts. For a while, utilities would only debit checking accounts, presumably because ACH payments are so much cheaper than credit card ones. A few years, they opened up to credit card payments. There seem to be a lot of people who do everything on credit cards and they must have had to change with the times.
    - 1y ago

potato3732842 1y ago

>Yes, currently the service is expected to fund itself. This is short sighted I could not disagree more. While I agree they don't "need" to be profitable and we "could" just give them tax money the fact that they try to be in the face of competition and come pretty close to doing so despite some dumb requirements really results in an incentive structure that puts them head and shoulders above pretty much any other subsection of government one interacts with. So perhaps let's not remove the incentive for profitability. Edit: And before anyone tries to construe this as me advocating for privatization or anything else like that, I'm saying they're fine the way they are (on a macro level, I'm sure there's tons of individual items that could use refinement, like any organization) and ought to be a model for other government functions. >and has progressively made one of the greatest public services worse. What? Are you joking? Have you ever tried to do anything other than a bog standard transaction at the DMV or get anything beyond typical "homeowner pays professional to do typical thing" type work permitted? The USPS is one of the most user friendly services in existence even once you get off the beaten path of sending standardized envelopes and parcels. If you restrict the comparison to just federal services it's not even close except perhaps some very specific common workflows but even then when it goes off the rails it goes off the rails way harder and is way more painful to resolve. Ask anyone of social security age if you don't believe me.

kochb 1y ago

Either it is able to fully fund itself through sender fees and other operations, or the net losses are ultimately paid for by other government revenues, primarily taxes. I enjoy Christmas cards and personal letters as much as anyone, but with electronic payments and telecommunications taking more of the volume, it is increasingly becoming an advertising service. If it is operating unprofitably, we are paying a form of subscription fee to receive those ads.

nxobject 1y ago
More charitably, it's a cost-sharing scheme for last-mile delivery to rural communities and deep suburban sprawl – as, to be fair, is often true for other rural services with significant federal funding like healthcare and higher education.
- dfxm12 1y ago
  At some point, we should do what we can to promote urbanization. Being able to deliver government services more efficiently is one benefit.
  - jermaustin1 1y ago
    A lot of the people who don't want to live in urban/suburban areas also view "government services" as a bad thing to begin with. Probably because they've never had good access to services.
    - dfxm12 1y ago
      I think they view government services as a bad thing for a few reasons, despite having access to good government services. These two stick out to me: The ubiquitous conservative media bombards them with lies about the quality, quantity and cost of these services, along with who receives the benefits. They also haven't taken a step back to consider all the things they enjoy that are provided as government services, like roads, police, education, subsidized mail delivery, unemployment, support for dairy products, etc.

TheJoeMan 1y ago

This creates a market discontinuity by the government that leads to abuse. Part of the reason for Amazon's dominance is that USPS undercharges for package delivery. When Amazon rolled out their own delivery service, they optimize delivering the "cheap" packages, and making USPS deliver the "expensive" out of the way packages, and due to flat-rates, USPS was in the red. USPS's solution? Keep squeezing grandma who wants to mail a few first-class letters a year.

BenjiWiebe 1y ago
Maybe in some places, but in our rural area (Durham, Kansas) 95%+ of Amazon packages are delivered by UPS.

kbolino 1y ago

It actually was profitable for most of its existence. It zealously guarded its monopoly on first-class mail because that's where the money came from. And it did so before it was spun out as a quasi-private entity. This is actually one of the challenges of public services in the US today; many things, from mail delivery to bus and train service to road construction and vehicle registration, were once self-sufficient but haven't been for a long time. There's a lot of reasons for this, but one of the outcomes is that entities which used to take care of themselves now have to beg for a growing portion out of the general fund. However, it's clear that the 1970s experiment to have it turn a profit again didn't work and likely never would have worked (it was, in many ways, set up for failure).

jermaustin1 1y ago
For the USPS, it would be profitable if it wasn't required to self-fund and pre-fund all retirement benefits for current and future employees 75 years in advance, paying for retirement health care for "workers" who aren't in the workforce, or even born yet. It was a political ploy to force the USPS into debt in 2006 with the Postal Accountability and Enhancement Act. No other federal agency or private sector business pre-funds its retirement benefits.
- kbolino 1y ago
  That requirement was repealed in 2022. The USPS still isn't profitable. While it reaped the benefit of that repeal and reported only a small loss in 2022, it reported much larger losses in 2023 and 2024, comparable to its loss in 2021 (when the requirement was still in effect).
  - deleted 1y ago
    [deleted]
  - strongpigeon 1y ago
    Last quarter was slightly profitable [0], but yeah the losses in 2023 were pretty big. https://about.usps.com/what/financials/financial-conditions-results-reports/fy2025-q1.pdf https://about.usps.com/what/financials/financial-conditions-...