Postal Service Warns of $22 Billion Hole From Coronavirus (wsj.com) 94
The U.S. Postal Service is facing a precipitous decline in mail volume and billions of dollars in additional losses as it operates during the pandemic, where hundreds of its workers have fallen sick and a dozen have died from the coronavirus. The Wall Street Journal reports: The quasigovernmental agency, which operates as part of the executive branch, is asking Congress for financial support, even after the Treasury Department extended it a $10 billion loan and increased its annual borrowing limit under the Cares Act last month. The agency's Board of Governors has asked Congress to provide $25 billion in emergency funding, a $25 billion grant for modernization projects and access to $25 billion in Treasury loans.
"We are at a critical juncture in the life of the Postal Service," Postmaster General Megan Brennan said in a statement Thursday. "At a time when America needs the Postal Service more than ever, the reason we are so needed is having a devastating effect on our business." The Postal Service projects the pandemic to add $22 billion to the agency's continuing operating losses over the next 18 months, Ms. Brennan said. Mail volumes and purchases of the agency's services have plummeted with the mandated closures of businesses around the country. She said losses could hit $54 billion over the longer term and threaten the agency's ability to operate. Ms. Brennan delayed her retirement earlier this year during a search for a successor. In other postal service-related news, Amazon announced earlier this week that it will halt its delivery service for non-Amazon packages. "Under the program, Amazon drivers would pick up packages from businesses and deliver them to consumers, rather than ship orders from Amazon warehouses," reports The Wall Street Journal.
The pausing of operations will let Amazon handle a surge in its own customers' orders, which may help the USPS as many of the orders get handed off to the company for shipping.
"We are at a critical juncture in the life of the Postal Service," Postmaster General Megan Brennan said in a statement Thursday. "At a time when America needs the Postal Service more than ever, the reason we are so needed is having a devastating effect on our business." The Postal Service projects the pandemic to add $22 billion to the agency's continuing operating losses over the next 18 months, Ms. Brennan said. Mail volumes and purchases of the agency's services have plummeted with the mandated closures of businesses around the country. She said losses could hit $54 billion over the longer term and threaten the agency's ability to operate. Ms. Brennan delayed her retirement earlier this year during a search for a successor. In other postal service-related news, Amazon announced earlier this week that it will halt its delivery service for non-Amazon packages. "Under the program, Amazon drivers would pick up packages from businesses and deliver them to consumers, rather than ship orders from Amazon warehouses," reports The Wall Street Journal.
The pausing of operations will let Amazon handle a surge in its own customers' orders, which may help the USPS as many of the orders get handed off to the company for shipping.
Contradictions in the Postmaster's position (Score:3, Insightful)
See if you can spot the inconsistency between:
and
The only reason people use the Post Office at all is that they are prohibited by law [washingtonexaminer.com] from using anyone else for particular types of delivery services.
Re:Contradictions in the Postmaster's position (Score:4, Informative)
The article at that link never mentions the USPS Universal Service Obligation [wikipedia.org].
That's an indication that it's more screed than analysis.
Re:Contradictions in the Postmaster's position (Score:4, Funny)
If you want the government to provide welfare payments for rural people, there's easier ways to do it than setting up a giant bureaucracy to monopolize non-urgent mail delivery across the entire country.
Re:Contradictions in the Postmaster's position (Score:5, Insightful)
B.S. The USPS has for a large part of my lifetime been self funded and one of the few parts of the federal government that does its job well. This makes the anti-government politicians hate it, because they hate anything that resembles a working branch of government that gets in the way of their "all government is bad" story.
Re: (Score:1)
The USPS is not part of the government. It also doesn't do its job very well. For example, they scan every letter and parcel for routing purposes but then they throw that data away instead of making it available to you, unless the sender has paid extra for delivery tracking. Well, they don't just give it away, first they give it to the feds. So the feds have the tracking data on all the mail, but you can't have it!
Re:Contradictions in the Postmaster's position (Score:5, Informative)
...they scan every letter and parcel for routing purposes but then they throw that data away instead of making it available to you, unless the sender has paid extra for delivery tracking....t!
I get an email each day telling me what is arriving in my mailbox, so it is not just "thrown away".
https://informeddelivery.usps.... [usps.com]
Re: (Score:2)
How often do you get the message that there's a piece of mail for which they have no data arriving? They often throw the data away before they even send you that message.
Re: (Score:1)
" first they give it to the feds"
Source?
Re: (Score:2)
Learn to internet
https://en.m.wikipedia.org/wik... [wikipedia.org]
Re: (Score:1)
The USPS is not part of the government
That's an interesting statement.
Then who does own it? Is it listed on a stock exchange? Is it owned as a partnership? Perhaps a single person owns it, or members of a family? Where does its executive management come from?
And now for a non-rhetorical question.
Are postal employees still federal Civil Service?
It's no more independent of the federal government than is the FDIC. The FDIC is a "corporation". But it's a part of the federal government, same as the USPS.
Re: (Score:3, Insightful)
What's the difference between a "giant" bureaucracy and a giant corporation?
Re: (Score:1)
Re:Contradictions in the Postmaster's position (Score:5, Interesting)
They need mail for all sorts of other things, not just contact with the government. If you take away universal service for mail, for phone/internet, for roads etc. then living away from cities becomes much less viable and you create all sorts of severe problems that more than offset the relatively small cost you "saved".
Problem of pricing (Score:2)
The problem is universal service is required AND the USPS can't set their own prices. Allowing variable pricing based on location would allow USPS to still service all locations, but without being hamstrung by a fixed rate. If it costs more for a letter to be delivered to Alaska than across town it should be priced appropriately. And if USPS's costs are increasing faster than inflation, they should be allowed to set their prices higher.
Re: (Score:2)
Re: (Score:2)
What "precipitous decline". People are ordering online a lot more now. Time to raise prices to Amazon et al, like Trump suggested?
Re: (Score:3)
Re: Contradictions in the Postmaster's position (Score:4, Interesting)
Thatâ(TM)s because you live in a profitable area. The problem is that the USPS charges roughly the same amount no matter where you live and depends on more profitable routes to subsidize less profitable routes. Amazon has started doing their own delivery on the more profitable routes but using The USPS for the less profitable routes. The USPS needs to either charge the actual cost for those less profitable routes or negotiate with companies like Amazon and refuse to delivery them unless they also get the profitable routes. Other options would be to do less frequent deliveries on the less profitable routes so that they are more profitable or have those people on those routes pick up their packages from a central location.
Re: (Score:1)
Re: (Score:2)
"What "precipitous decline". People are ordering online a lot more now. Time to raise prices to Amazon et al, like Trump suggested?"
If he had shut his mouth, Amazon wouldn't have bought 250.000 trucks.
Ask Dolores, if you want something done right, you do it yourself.
Re: (Score:2)
What "precipitous decline". People are ordering online a lot more now. Time to raise prices to Amazon et al, like Trump suggested?
I've had exactly 1 Amazon shipment via USPS in the past 6 months. Up until the past 60 days, virtually all of them where delivered directly by Amazon's services. Even now, they are using UPS and not USPS when they can't handle the overflow where I live. Sams uses UPS and Fedex, Best Buy uses UPS and Fedex (although sometimes with USPS doing last mile, so they got that I guess), Home Depot is Fedex. About the only thing consistently delivered by USPS are ebay purchases.
Re:Contradictions in the Postmaster's position (Score:5, Interesting)
My wife ships a lot of goods for her wholesale and retail businesses.
UPS and Fedex are horribly unreliable. They have fancy tracking and are open later into the evening, but they will then deliver it to the wrong address and not pick up when you call them.
The USPS is less convenient, but in comparison to UPS and Fedex, they are super reliable and almost always deliver to the right place.
Re: (Score:2)
Re:Contradictions in the Postmaster's position (Score:5, Funny)
The only reason people use the Post Office at all is that they are prohibited by law [washingtonexaminer.com] from using anyone else for particular types of delivery services.
And you can get a letter mailed more cheaply where? Or is this one of those Libertarian fantasies where if only the dadburn'd gubbint got out of the way the magical, rainbow farting unicorn of the free market would provide a system that delivered letters for three cents each, all the way to Alpha Centauri and back (because without that dadburn'd gubbint (TM) in the way, we'd have faster than light travel by now).
But seriously, a lot of "people" use the post office. It seems to provide reasonable service at a reasonable price to almost every person in the country - something your Libertarian fantasies will not provide, ever.
Besides, who the fuck are you to argue with Ben Franklin?
Re: (Score:2, Interesting)
And you can get a letter mailed more cheaply where?
Flew over your head, didnt it?
It is illegal to provide a competing service for the delivery of letters. Anyone that offers a cheaper service gets shut down, with armed thugs raiding their business.
Re:Contradictions in the Postmaster's position (Score:5, Insightful)
He or she asked the wrong question. It's not a matter of who could. It's a matter of who the hell would want to. I'm sure other delivery services are just lining up and chomping at the bit to deliver a letter from Point Arena, California to West Quoddy Head, Maine, all for just 55 cents US. And that's just sticking to the continental US. Besides having a law that says only USPS can deliver certain things, there is also a law that says USPS *MUST* deliver those certain things to any legitimate address in the US or its territories. And I guess you've not noticed how UPS, Fed Ex, etc passes the buck now by letting USPS handle that "last mile" part of the service on many of their residential deliveries. I'm sure UPS etc own more than a few congressmen of their own. If they wanted the business, they would have already paid to have the law changed.
Re: (Score:2)
> UPS, Fed Ex, etc passes the buck now by letting USPS handle
Sounds to me like a profit opportunity. Or at least a "break even" opportunity. It's not like UPS is going to Bumfuck OK, law or no law. Charge them through the nose for it.
Re: (Score:1)
Bumfuck OK
I assume you are aware that the homeless population is much lower in Oklahoma than whatever blue state area you live in. The bums being fucked are in your neighborhood, dude.
Re: (Score:2)
No bums in the 'burbs, bro!
Re:Contradictions in the Postmaster's position (Score:4, Insightful)
He or she asked the wrong question. It's not a matter of who could. It's a matter of who the hell would want to. I'm sure other delivery services are just lining up and chomping at the bit to deliver a letter from Point Arena, California to West Quoddy Head, Maine, all for just 55 cents US. And that's just sticking to the continental US. Besides having a law that says only USPS can deliver certain things, there is also a law that says USPS *MUST* deliver those certain things to any legitimate address in the US or its territories. And I guess you've not noticed how UPS, Fed Ex, etc passes the buck now by letting USPS handle that "last mile" part of the service on many of their residential deliveries. I'm sure UPS etc own more than a few congressmen of their own. If they wanted the business, they would have already paid to have the law changed.
What you said plus this: The USPS does something the delivery services don't do and certainly do not desire to do and that is home mail pickup.
The USPS comes by almost every home in the USA 6 days a week just in case you might have a letter to send. Nobody wants that business.
The only way UPS/Fedex/ETC would do that is if they could cherry-pick lucrative routes in dense areas such as in Manhattan Island.
Re: (Score:2)
Re:Contradictions in the Postmaster's position (Score:5, Informative)
And that's because this is an essential service. Private businesses tend to be bad at essential services; they either try to profit too much from it, they limit their market ranges and cut out anyone rural. Bell Telephone did it but it was granted a monopoly under the condition that it provided universal service, unlike the early days of mobile telephones where only urban cores had service and even today there are large swaths of the country with substandard or no mobile service.
Sure you can claim that all paper should vanish and everyone is required to use the unreliable, unsecure, and overpriced internet, but that's just a pipedream for Gen-Zzzs.
Re: (Score:2)
What are you talking about? The only leg up USPS has is that a mailbox needs to be maintained and only they can put stuff in it. Anyone is welcome to start up a competing business and they don't even need to meet the federal workers standards nor maintain a pension for retirees. There are plenty of courier services in each of our major cities that get pretty good business. But none will venture outside that city.
The reality is that national courier service doesn't have a free market solution. The expen
Re: (Score:2)
It is illegal to provide a competing service for the delivery of letters. Anyone that offers a cheaper service gets shut down, with armed thugs raiding their business.
I've fedexed and UPSed letters. Many times these are legal documents. Not illegal. However, we prefer to use USPS whenever possible.
Re: (Score:1)
"But seriously, a lot of "people" use the post office. It seems to provide reasonable service at a reasonable price to almost every person in the country - something your Libertarian fantasies will not provide, ever."
Old people and companies that rip off old people use it.
Re: (Score:2)
After getting my credit card number hacked three times in nine months, I've gone back to a lot more bill paying by paper check through the mail. And I paid my income taxes through the mail, ( due to a certain complication I'm required to file paper returns). Letters to Mother go through the mail because she refuses to use email.
So after a bit of a lull, I'm using the mail more than I have in some time.
Re: (Score:2)
Yep, no set of competing private organizations in any other industry manages to provide a reasonable service at a reasonable price right? That's just a fantasy....
Re: (Score:2)
> And you can get a letter mailed more cheaply where?
That was the OP's point. UPS and FedEx _can't charge less_ than USPS, _by law_. The law was written to keep USPS afloat. USPS, however, is so poorly managed it just keeps hemorrhaging cash, and it will continue to do so until it gets competent management and raises prices to destinations where Amazon's own delivery service can't go.
Re: (Score:2)
Citation on the "law" please? Maybe the rest of us will learn something.
Re: (Score:1)
I'll call citation please. I believe what you're thinking of is that a 'normal' letter must be carried by USPS, whereas an 'extremely urgent' letter may be carried by anyone. Because nobody cares to assert that their letter meets the content requirement to be defined as 'extremely urgent,' they rely on the cost definition- anything 2x the cost of USPS first class delivery or above $3 is by definition 'extremely urgent'. Moreover, periodicals, commer
Anyone else goes to jail for the retirement fraud (Score:2)
> requiring their pension and other retirement obligations to be *currently fully funded*.
They actually aren't quite required to do so, unlike any business. More on what's actually required of USPS in a moment.
For any private business, every paycheck they send money to Fidelity or whoever, a third-party custodian who holds and manages the funds you earned this month and will use in retirement. They got your services this month, you earned that retirement money this month, they need to pay for your servic
Re: (Score:2)
Actually, the only reason the USPS is doing poorly financially was the Republican Congress and President required them to pre-fund retirement for 75 years into the future (to include healthcare)...a requirement no other enterprise is required to do (not even the rest of the federal government). Eliminate that requirement, and you'd suddenly see a surplus in their revenue.
And their requirement has to presume ALL employees will retire, and make progress through their careers. Not all USPS employees remain
Re: (Score:1)
"And you can get a letter mailed more cheaply where?"
You can't. So what? We need the USPS less than ever because we're mailing less letters than ever, and because more of our business can be done over the internet than ever. Only old people still use the USPS on purpose. The USPS would be gone by now if not for all the spam, none of which I want.
And if the USPS were gone, then the last holdouts who won't let us do business over the internet would either get over it or go out of business, and let someone mor
Re: (Score:2)
And if the USPS were gone, then the last holdouts who won't let us do business over the internet would either get over it or go out of business, and let someone more competent take the business.
Is there something wrong with doing business with the people who will work with you the way you like, rather than forcing other people to work with you the way you like?
Re: (Score:2)
"Is there something wrong with doing business with the people who will work with you the way you like, rather than forcing other people to work with you the way you like?-
Yes. Driving that data around creates pollution and perturbs traffic.
Re: (Score:2)
Comment removed (Score:4, Interesting)
Re: (Score:2)
Nope, I'm saying that the fact that people are using a service less implies that they need that service less, not that the need it more, as the postmaster general seems to be attempting to say.
Re:Contradictions in the Postmaster's position (Score:4, Insightful)
I think the point the GP is trying to make is that your analysis is wrong because the subset of people who need it and the subset of people who use it are very nearly perfectly disjoint sets. Most people receiving stuff from USPS do need it for receiving things that are critical to their lives. However, most of the people actually using USPS (i.e. mailing things out) do not need it right now.
Re: (Score:2)
That's incoherent. People don't separately need to receive things from a shipper without a corresponding need by the shipper to send them. The actual transaction is between the sender and receiver, the USPS is just a byproduct. If less people are having things delivered to them by the USPS, then they obviously need it less than they did before, not more.
Re: (Score:2)
That's just not true. Typically, the vast majority of stuff that people send out is ads that almost nobody needs to receive, but the people who send it out
Re: (Score:3)
Feel free to deregulate the market if you want, but please do it after this crisis is over, not right smack in the middle of one.
Re: (Score:1)
Congress may have to pass new laws that allow them to deliver more packages. That's where the demand is, not letters. The virus changed the world, we gotta adjust, at least temporarily.
Re: (Score:2)
Well that, and UPS and Fedex are overpriced for sending a letter.
Re: (Score:2)
First Class Mail is exclusive to the USPS because only they have the right to require you put a mailbox by the street, and the right to pick up every day from you without a request.
UPS and FedEx compete with similar flat-rate fast mail envelopes and large packages.
Re: (Score:2)
Crazy right-win talking points...check.
Link to crazy right-wing news source...check.
Many people use the Post Office for many reasons. Some of us like the Post Office and don't want to shut down due to one of the Mango Mussolini's petulant tantrums.
Re: (Score:1)
Your response full of logic and free of any ad hominem attacks and unrelated diatribes has now completely convinced me that we have always been at war with eastasia. /s
Re: (Score:1)
Can you read?
Re: Contradictions in the Postmaster's position (Score:2)
Re: (Score:2)
Re: (Score:2)
Trump Personally Pushed Postmaster General To Double Rates on Amazon, Other Firms: Report [slashdot.org]
Trump is lying (Score:2, Offtopic)
A reminder: almost everything Trump has said about this is a lie:
https://www.govexec.com/manage... [govexec.com]
Learn to code? (Score:1)
Re:Learn to code? (Score:5, Informative)
Re: (Score:3)
And you would too if you were required to prefund your employee retirement account through 2056, a requirement no other business has to content with.
https://www.bloomberg.com/opin... [bloomberg.com]
Yeah, so one group sees it as a way to make the USPS lose money so more people will want to get rid of them, and another group sees it as trying to at least protect the current employees pensions from the people trying to get rid of them. Can see how they would agree on this legislation......
Re:Learn to code? (Score:4, Informative)
and another group sees it as trying to at least protect the current employees pensions from the people trying to get rid of them.
No, they just use that excuse. The requirement for pre-funding is only partially the contention, the obscene time range is the contention, especially considering (and I remind you) this is a fucking government organisation and the government itself are the ones who should be guaranteeing the pensions of the government employees, not the department itself.
The only way you set up something like this is if you're actively trying to make it fail.
Re: (Score:2)
especially considering (and I remind you) this is a fucking government organisation and the government itself are the ones who should be guaranteeing the pensions of the government employees, not the department itself.
I agree. In theory. I'm not sure your government is trustworthy enough for that anymore. You admit that some elements want the USPS to fail, but you think they care about pensions? Rest assured many of those same people would love to see those go away too. Given their way in a few decades public sector pensions may be entirely a thing of the past.
Trump complains about Amazon (Score:1)
Re: (Score:2)
USPS and UPS still deliver Amazon in my area. However, Amazon's deliveries via USPS are significantly down since Trump attacked Amazon and they started their own delivery service. Sad. Trump barges in with a personal vendetta without thinking things through.
Re: (Score:2)
This is by design (Score:3, Insightful)
Re:This is by design (Score:5, Informative)
USPS employees get paid the same monthly wages regardless of the amount of mail that's delivered. So payroll expense is a fixed amount. On the other hand, revenue (stamps and package delivery fees) is proportional to mail delivered. Under normal conditions, you can estimate the amount of mail that people will send, and the law of averages allows you to match up revenue with expenses.
But under the current situation, payroll expenses has stayed the same, while mail volume (and thus revenue) has dropped precipitously. That's what's creating the budget shortfall. In a private company, you'd have two choices:
So the USPS ends up bleeding money when mail volume drops below what was assumed when they first came up with the cost of postage based on the number of employees needed to deliver mail.
Re: (Score:1)
No. Companies should be required to fund pensions as the liabilities accrue.
The USPS is being required to fund pensions that are not yet owed, which is ridiculous.
Re: (Score:3)
the right wing has been trying to destroy the Postal Service so they could privatize and profit from it for ages. The only question is are we going to let them do it?
That's not the only question. "Is privatizing the Postal Service a good idea?" is another question, and we should be asking it.
Germany, Japan, the Netherlands, and the UK have all privatized their postal services. It would be beneficial to know how those countries have adapted.
Wow this must be government math (Score:2, Insightful)
Then we have
"even after the Treasury Department extended it a $10 billion loan"
Board of Governors has asked Congress to provide
$25 billion in emergency funding
a $25 billion grant
access to $25 billion in Treasury loans
The government, never let a good crisis go to waste.
Just my 2 cents
USPS (Score:5, Interesting)
I know people's experiences are different, but I'm a big fan of the USPS. The staff are usually friendly, they bring our stuff every day with care and diligence and I can mail something anywhere in the use for a little more than 50 cents. I can also get mail from anyone to one address that doesn't need any weird agreements or contracts.
I'd like to see them get more efficient, maybe deliver to each house every other day or something, but I do want them to stick around. I really would be fine with even 2x per week mail, if it would let the service keep going.
Re: USPS (Score:3)
Me too, post office service has been fine. Since thereâ(TM)s a post office in or near most towns, I think the Feds should add services to those locations. Maybe not fully staffed but have a social security kiosk, with perhaps a live person trained to some first level of support. Medicare...US Ag, veteran affairs, lots of opportunities .
Deliver less often (Score:3, Interesting)
Allow USPS to compete in free market (Score:2)
So Amazon just announced that it would pull out from the unprofitable part of its delivery service. Imagine the utter stupidity if the Amazon board directed Amazon to stay in that unprofitable market because it said so. Well, that's the case for the USPS, which is mandated by law to stay in unprofitable markets. Why? Because Congress said so. Congress and the public then put on their acting face and feign surprise and indignation that the USPS is losing vast amounts of money by staying in unprofitable
A few obvious things you can start with (Score:1)
1. Stop delivering packages for Amazon for below your costs.
2. Stop delivering junk mail when the margins while consuming a huge amount of infrastructure and labor.
3. Stop letting ebayers steal thousands of priority mail cartons and envelopes. They're using a dozen padded envelopes to package the products they send me. charge a nominal deposit for the priority mail materials, refund the returned unused materials.
Re: (Score:1)
(correction)
2. Stop delivering junk mail when the margins while consuming a huge amount of infrastructure and labor.
2. Stop delivering junk mail when the margins are low, while consuming a huge amount of infrastructure and labor.
What parts of the govt are profitable? (Score:2)
If profit/loss is the determinant someone really needs to look at the Department of Defense. That place hasnâ(TM)t been in the black since 1944
New trucks (Score:1)
Answer: Stop Subsidizing Junk Mail (Score:2)
Boo-frickin-hoo (Score:2, Insightful)
What about the millions of people who literally had their jobs taken away from them? Businesses that were forced to close that will never reopen? All for some bullshit public good nonsense. This isn't a natural recession or depression. These jobs were TAKEN away for no reason at all.
The long term effects will be devastating. 1/3 of the US didn't pay rent for April. That will have huge trickle down effects. Mortgages aren't being paid. That will have a trickle down effect. House sales will slump. C
So Trump was right? (Score:2)
USPS is Constitutionally mandated for good reason. (Score:2)
It's an essential service.
The privatization advocates want the money and of course have no concept of civic duty. There is a general business conspiracy to destroy government and when it succeeds (as is highly likely) the public will be unable to defend itself.