USPS posts $3.1 billion loss in Q3, warns of default

[daylate]

WRF. Not being witter savvy I'm not sure if this is a universally accepted acronym but the W stands for We and you need to change a tense but I'm sure you get the drift. Closing branches and eliminating Saturday delivery makes sense. However the other side of that equation is that people will lose jobs or at least see their wages cut. Same with the pension expense. The solution to all of our economic problems will have many unintended consequences. Cut government spending? Great idea but what about the business who receive that money? They will have to cut jobs which will reduce consumer spending which will cause other businesses to stop mailing as much which will cause the Post Office to lose more money so they will close more branches and reduce delivery to 4 days a week. See the problem? I do but I don't see the solution as being simple. Solve one problem, cause others. It is the way of the world. Hard to change horses in mid-stream.

Of course the nation can elect God fearing (and exploiting) Rick Perry as our next President who based on his record as Texas governor will immediately solve our problems by cutting taxes. We know this is a good idea because Texas just solved a 14 billion two year deficit (caused mainly by an ill conceived property tax cut five years ago) by slashing aid to education, police, fire, etc. essentially all safety net things. And we know that low taxes as enacted by the Bush admin with an aid from Congress has definitely helped the US economy. Our 9% unemployment rate would most likely be double digits, the number of bankruptcies would be skyrocketing and housing prices would be plummeting to record lows with a resulting boom in foreclosures.

So I strayed a bit from the original topic. Bottom line is the same. WRF.

[Pandora]

Just wanted to post a FYI in the event USPS does change the rate for stamps:

When buying stamps, ALWAYS buy the Liberty Bell stamps - they will remain w/out postage on them even thru rate increases as that is the stamp that is the "go-to" when rates change. I've been doing this for years now and every time stamps go up in cost, I never have to buy more.

[IamOld]

I would add the problem is also spending literally trillions on wars - let's be honest folks...trillions. AND our wonderful corporatocracy and billionaires paying nothing, and the US making nothing.

[mlsj2009]

The real problem in this case is how public retirement funds are being funded. In private accounts, your employer may match contributing funds, and to that employer, the funds no longer belongs to the company, gone forever. The employer has the money at the time and therefore, doesn't miss it in the hereafter. If the retirement fund tanks, the retiree loses, plain and simple. In public retirement programs, our wonderful politicians rob Peter to pay Paul. They historically (ie. Social Security) have taken vested funds and used them for other budgeted purposes, to make the budget balance of course. The only problem is when times get financially tough like today, the funds are heavily exposed to the supply and demand side of the markets. So, the taxpayer is asked to bail out their political wheeler dealing over and over. Go figure!

I totally agree!!!! This is what I have always been saying about bank bailouts and bonuses and you can also add politician salaries and other benefits.

A major problem in the western world are retirement pay and benefits period! Just as I mentioned the PO has 650k full time workers and 350k retirees. What happens when they have 350k workers and 650k retirees and even less first class mail???

The problem is how can we ask our citizens and workers to make concessions when congress always gets a pay raise and always gets medical and retirement benefits.

The answer is no one rightfully so will make any concessions for those reasons so the bankruptcy of the US followed by a greater depression then before will automatically do it for us.

[shark66]

Fedex and UPS skim the USPS's cream...by design.
Ebay for one, would shut down without USPS.

Now, shutting down of eBay would most likely have a worse effect on this country's economy than any credit downgrade...

Good luck to us all.

[catleg]

There are certain things in business that simply do not turn a profit on their own.
These are called cost centers.
Transportation (in general) being one.
Fedex and UPS skim the USPS's cream...by design.
Ebay for one, would shut down without USPS.
Until recently the banking system needed USPS; now, just the debt collection system, sadly.

[frogger]

Oh yes indeed. Let's raise the rates.

That's sort of like taxing your way to prosperity.

The higher the rates, the less it will be used....

[jacko]

Err wrong. USPS needs Congress permission to close down Post offices and about anything else. There is a lot of opposition in communities including the anti gov spending ones to, don't close my Post Office, but close the neighboring town one etc..Even with closing down the ones on the list, still not enough to stem the red ink.

We have to decide if its in the public interest that the Post Office needs to be subsidized to remain viable. UPS and Fed Ex would never deliver to every residential zip code unless a first class mail is priced a dollar or more.

It's assinine to blame it on Congress. USPS was not able to compete with the competition. Not to mention texting and e-mail took away a lot of business. It was bound to run into financial trouble.

It is good that they are reviewing which branches they can close. They can start where I live. I live in a town that the only difference from the next town is the zip code. We have the same mayor, the same municipal court. We just have two post offices. We don't need that many.

And, again, this goes to how the USPS is being run and not Congress.

[catleg]

The PO is required to deliver mail from Bangor ME to Hana HI for the same flat rate.
Try doing that with UPS or Fedex.
Their business has gotten messed up by on line bill presentment and payment.
Massive loss of first class business.
Thank God for all the bankruptcy mailings and debt collection mailings otherwise they'd have nothing left to deliver except for a near continuous flow of junk mail from Harrah's Total Rewards.

[banca rotta]

There are many things the USPS could do to trim costs to an acceptable level. If they go belly up and default you can almost bet a good portion of those employees might lose there pensions and then will be forced onto welfare. They can go down to a 3-days home delivery from the current 6 days. They can also triple the fee for delivering all the damn spam mail. They can double the price of 1st class postage. I wonder what the management to hourly worker ratio is, I am certain you can trim the fat on both sides. They can really trim future benefits costs by having newly hired employees covered under a more manageable benefit package. I certainly don't think it is prudent to blame the current workers pay/benefits when that is what they signed up for. I hate to say it but until our own congressional and house reps decide to take paycuts and give up their retirements they have no business taking away from others.

I totally agree!!!! This is what I have always been saying about bank bailouts and bonuses and you can also add politician salaries and other benefits.

A major problem in the western world are retirement pay and benefits period! Just as I mentioned the PO has 650k full time workers and 350k retirees. What happens when they have 350k workers and 650k retirees and even less first class mail???

The problem is how can we ask our citizens and workers to make concessions when congress always gets a pay raise and always gets medical and retirement benefits.

The answer is no one rightfully so will make any concessions for those reasons so the bankruptcy of the US followed by a greater depression then before will automatically do it for us.

[justbroke]

Changing the mail delivery from 6-days to 3-days will take an act of Congress. It's not going to happen. I still bet that they will need to take a SERIOUS look at the pensions. Their problem has mostly been their UNFUNDED pension and the mandate to get it funded.

I don't blame USPS for having an underfunded pension. I can't tell you how many municipalities (and States) have operated for YEARS with underfunded pensions. Some of them, actually funded their pensions from the operating budget!!! Talk about ineffective management.

[df04527]

There are many things the USPS could do to trim costs to an acceptable level. If they go belly up and default you can almost bet a good portion of those employees might lose there pensions and then will be forced onto welfare. They can go down to a 3-days home delivery from the current 6 days. They can also triple the fee for delivering all the damn spam mail. They can double the price of 1st class postage. I wonder what the management to hourly worker ratio is, I am certain you can trim the fat on both sides. They can really trim future benefits costs by having newly hired employees covered under a more manageable benefit package. I certainly don't think it is prudent to blame the current workers pay/benefits when that is what they signed up for. I hate to say it but until our own congressional and house reps decide to take paycuts and give up their retirements they have no business taking away from others.

Right on!

[BigJohn]

Should I give my mailman my recipe for air steak and air wine?

[Meatstick]

There are many things the USPS could do to trim costs to an acceptable level. If they go belly up and default you can almost bet a good portion of those employees might lose there pensions and then will be forced onto welfare. They can go down to a 3-days home delivery from the current 6 days. They can also triple the fee for delivering all the damn spam mail. They can double the price of 1st class postage. I wonder what the management to hourly worker ratio is, I am certain you can trim the fat on both sides. They can really trim future benefits costs by having newly hired employees covered under a more manageable benefit package. I certainly don't think it is prudent to blame the current workers pay/benefits when that is what they signed up for. I hate to say it but until our own congressional and house reps decide to take paycuts and give up their retirements they have no business taking away from others.

[banca rotta]

It's assinine to blame it on Congress. USPS was not able to compete with the competition. Not to mention texting and e-mail took away a lot of business. It was bound to run into financial trouble.

It is good that they are reviewing which branches they can close. They can start where I live. I live in a town that the only difference from the next town is the zip code. We have the same mayor, the same municipal court. We just have two post offices. We don't need that many.

And, again, this goes to how the USPS is being run and not Congress.

As usual you twist things around that I say. I know exactly how the PO got where it is.

It got their for the reasons you mentioned plus I read somewhere they have about 650 thousand employees they have to pay and about 350 retirees they have to pay.

My point is the bankrupt post office is asking the bankrupt US congress to step in.

Since you are correct in why they are bankrupt exactly what can congress do to help is my point? The only thing I can think of is to break a lot of the contracts which will bring about a lot of legal challenges. Or the more likely congressional action will be to bail them out (IE tax and print money to pay the failing PO).