The Postal Service Gets A(nother) Handout From Washington

Thursday, February 17, 2011 , , 30 Comments

Our favorite quasi-private, government-handout-addicted mess the Postal Service may see a little fiscal relief in the year ahead thanks to some creative reshuffling on Obama's part. It won't fix the USPS, it merely delays their day of reckoning (a theme with our dear government these days as we know).


President Obama's proposed 2012 budget doesn't say anything about raising stamp prices, ending Saturday mail deliveries or closing post offices, but it tries to remedy the U.S. Postal Service's perilous financial condition by recommending about $11 billion in relief.


In the Obama administration's first substantive attempt to address the Postal Service's fiscal woes, the budget would allow the agency to pay $4 billion less toward future retiree health benefits than otherwise required. The mail agency would have to pay about $1.5 billion of those costs in fiscal 2012 and make up the difference in later years.

How is the USPS supposed to make up the difference if they can't even pay the bills as is?

I say let them go fully private and worry about their own financial issues or get real about the situation and stop pretending like they are an independent agency. I'd love to see the Postal Service increase stamps to 60 cents a piece and see how that works out.

Here's what I'd still like to know... how is it the USPS has almost maxed out their $15 billion Treasury credit limit but it still managed to send over $50 billion more than it needed to to cover these pension liabilities? And where's that money?

Jr Deputy Accountant

Some say he’s half man half fish, others say he’s more of a seventy/thirty split. Either way he’s a fishy bastard.


Randy F said...

TIME OUT!!! You need to do a bit of research before claimign that you have uncovered some deep mystery about the dealings of the USPS.

You ask where the $50 Billion went? Nowhere. As part of the PAEA(look it up) of 2006, the USPS was mandated to PRE-FUND future retiree health benefits. The number deemed necessary was $55 Billion. The law also mandated that the $55 Billion must be paid within 10 years. The "handout" as you put it does not absolve the USPS from funding this but rather to shift some of the burden to the end.

I dare, in fact double dog dare you, you to find ANY other company or agency, public or private, that has had this thrust upon them, and their bottom line.

You seem to have a really short memory. The USPS had surpluses in previous years and had periods where the cost of a stamp did not change for four years.

Part of the relief in the budget is
a payment of some $550 million over the next 30 years to return a few billion dollars that the USPS had overpaid into the one retirement system.

Funny how the Fed can take 30 years to pay back less than $9 Billion but thinks that the USPS can pay $55 Billion in only 10 years.

None of this even mentions the $55-$75 Billion that USPS was forced to overpay into the Civil Service Retirement System.

Sure, it would be nice to jsut raise rates, like a private company can do or add surcharges and fees but, do you really think that UPS or FedEx will deliver a letter from Puerto Rico to Guam for only 60¢?

Good Luck with that.


EXACTLY my point. It doesn't make sense, any of it. The numbers don't make sense nor do the restrictions nor does this weird overfunding conspiracy whereupon Congress is somehow looting the USPS only to return the favor in the form of paltry "bailouts". So what's with this mass fuckery when it comes to the Postal Service and who do we blame?

I haven't uncovered some deep mystery, in fact the more I research the matter the less it makes sense.

So until someone can explain where the fuck this money is going and why we can't just cut USPS loose already so they can manage themselves (supposedly they're good at it), we're stuck with conjecture and broad statements about what could or might be.

And what are you talking about the Fed having to pay back anything? NOW you're in my domain and they don't owe anyone shit.

Also, Randy, you wouldn't happen to work for the Postal Service would you? Just wondering.

W.C. Varones said...

God forbid the USPS should actually have to fund its pension plan.

If they don't like it, put them on 401k's like the rest of us.

Greedy, lazy bastards.

Anonymous said...

"I'd love to see the Postal Service increase stamps to 60 cents a piece" for bulk mail.

Why are the rest of us forced to pay high 1st class rates to subsidize the junk mail? This is stupid. Let the bulk mail senders pay their own way.

Randy F said...

Yes, I have worked for USPS for almost 27 years. I though that there could have been some civil discourse concerning your use of the words "handout" and "bailout". However, since it seem that you have to resort to dropping F bombs, I can assume you aren't interested in that. You are stating that your "opinion" is right and the only plausible idea about any of this.

The other comment also does not understand about the Federal Employee Retirement System. It is very similar to a 401-k in that we contribute to a fund and some of that is matched by the USPS.

It was also misunderstood that the $55 Billion is the PRE-FUND FUTURE Retiree HEALTH BENEFITS. It has nothing at all to do with "pensions".

Not pay back anything? How about this? If you paid into a fund for, say, electricity. A formula was used to determine how much you should pay every month. You pay the same amount for 30 years. After that time, you find out that the formula was flawed and that you should only have been paying about 75% of what you actually paid.

Would you expect a refund of that overpayment? Of course you would. USPS has been paying into the Civil Service Retirement System under a flawed formula since 1972. The result is that there was an overpayment estimated at $55-$75 Billion.

The audit was performed by the Government Accounting Office, not the USPS. GAO put the overpayment at $75 Billion. Another, independent audit put the overpayment at $55 Billion. Again, not a USPS audit.

So, shouldn't the USPS, since it is not entitled to any taxpayer funds for operations expect a refund of the overpayment? Just like you would for the excess you paid for electricity? Same thing.

I would also repeat that I dare, in fact double dog dare you, you to find ANY other company or agency, public or private, that has had this thrust upon them, and their bottom line.

Other companies do have to fund and prefund certain things associated with their retirees, however, those are generally funded to a lesser extent that 100% and they pay in to the fund over a period of 30 or 40 years, nothing so ridiculous as 100% in 10 years.

When I started at USPS, there were well over 800,000 employees. That number slowly dwindled to around 700,000, where it remained for many years. Since 2000, the workforce has shrunk to a little over 500,000. So, it's not like nobody is doing anything. Millions of work-hours have been cut and capital expenses have been deferred or canceled altogether. In the facility that work in, there were around 150 clerks, 100 carriers and maybe about 50 in management. Now there are 0nly 75 clerks about 75 carriers and maybe 30 in management. We are also processing twice as much mail. It's just that the budget is not shrinking as fast as the revenue at this time.

You should consider subscribing to the Postal Reporter or do as I do and set up News Alerts through Google. That's how I came across your story. You would have seen many stories from the Federal Times, Wall Street Journal, Washington Post, USA Today etc. that state just what I am saying. It has just a little to do with me being a Postal Worker because that is what prompted me to reply to your story.

The USPS is not asking for handouts or a bailout, it is simply seeking to recover the over-payments made in to the two retirement funds and to obtain some relief from the onerous burden of paying an exorbitant amount of money to the pre-funding of future retiree health benefit fund. Not to stop payments but to reduce the amount until such time as the economy stabilizes and the USPS is "right-sized".

Here's another little factoid for you. Every 1¢ increase in the cost of fuel, like gasoline and diesel fuel, adds $1 million in expenses annually. Unlike UPS or FedEx, the USPS does not have the ability (read Congressional approval) to tack on a fuel surcharge the next month but must wait until the following spring to "request" a rate increase.

Have a good evening.

Randy F said...

"Why are the rest of us forced to pay high 1st class rates to subsidize the junk mail? This is stupid. Let the bulk mail senders pay their own way."

Funny that this should come up. I happen to be a Business Mail Technician.

The Bulk Mailers do pay their own way. They do not just slap a permit an an envelope and dump their mail in a collection box.

They presort their mail. Tehy pre-barcode their mail. They sort their mail in the exact sequence that a Letter Carrier delivers their route.

If Mr Anonymous would do that, with certain minimum volumes as well, then Mr Anonymous could also enjoy a discount on their postage.

As an Example, a major national retailer pays around 15¢ per piece for their letters. However, they send about 25 million pieces each month. They also use their own transportation to drop their mailings directly to the Processing facility that serves the ZIP Codes they are mailing to.

You, Mr Anonymous, drop a single letter, maybe 4 or 5, into a blue box or maybe have it taken from the mailbox right at your door.

You expect that your letters will go to any other destination in the US using USPS sorting equipment and personnel. Using USPS transportation to get it from A to B and USPS technology to barcode and sort your letters.

All of that costs. In actuality, Most Bulk Mailings "subsidize" the low First Class Mail rates.

USPS delivers over 40% of the total WORLDs volume of mail cheaper and quicker than any other Postal Administration anywhere.

Take a little country like Norway. I would guess roughly the size of California, Oregon and Washington. It costs them well over $1 for an ordinary letter and the average deliver time is 5 days.

Mr Anonymous, save up all of the mail that you wish to send, paythe fees to be a bulk mailer, have at least 200 Identical weight and size pieces with no personal information and you can send those for 27.3¢ each or less.

Good luck with that.

euchre said...

I can't possibly improve on Randy's post, it does an excellent job. Jr Deputy: Kind of embarrassed for you here. You're spewing things as fact simply because you've read them somewhere.....

BTW, I LOVE the netflix envelope you're using to show how pathetic the post office is. Netflix, the company that has been told repeatedly that their envelope design causes that exact problem when it's put through the mail sorting machines. They have refused to change the design because that would cost them money. Instead there is a big game that the post office plays with netflix packages, where carriers are supposed to manually sort out their product and not send it through the machines. Well, sorry, but we individually handle thousands of pieces of mail a day, some go through the machines. (don't tell gamefly that we sort out netflix mail, there's a big messy inquiry regarding this where the post office and netflix deny this occurs).


Euchre - Let me spew this fact that I "read somewhere" ... from Netflix: No more DVDs by mail. All streaming video from now on. Kind of like email and other things you can get without waiting or other hassles.

euchre said...

Huh...from NOW on? Like once you stated it, going forward? Cuz I got one in the mail today. Should I just return it with the notation "lazy paperboy said you sent in error"?

What exactly was the point of your message? My point about netflix was that the picture was used to make the postal service look bad, when in fact, the problem shown is caused by the envelope. You felt the need to reply about your own point, but I'm failing to see what it is. Maybe you can help me out.



We're grown ups here, we can say "fuck" if we would like to and it doesn't make the conversation any less intelligent unless "fuck" is used in "fuck you" or "fuck off, you fucktard," which I find to be crossing the line in an intelligent conversation. Is that OK with you?

Forgive me for using "pensions" broadly to mean "retiree benefits including health care," I figured the WaPo clip explained it sufficiently but apparently not.

You guys are missing my point. Congress needs to get out of the USPS' business and everyone can be happy. They can charge whatever they like and not have to worry about silly RETIREE HEALTH BENEFIT funding requirements as dictated by Congress.

That can't possibly go wrong, right? Or am I confused by my facts again?

euchre said...

Lazy paperboy...I'm pretty upset now, because I just looked on Netflix webpage. I didn't even have to click a link and I see where it's "$2 more to get unlimited DVD's by mail". Is Netflix not yet privy to your decree?

So confused....

euchre said...

JR Deputy:

Yes, you are confused. NOBODY wants to deliver all the mail to all the US. UPS is on record as stating that USPS serves a purpose that they have no interest in serving. FED/ED gives a strong "no comment" on the same topic. All private companies would want to do is deliver to big cities, where they can make the most money.

To suggest that you just privatize the post office is a solution is short sighted, and borderline ridiculous.

Also, it was nice that you didn't let Randy's facts skew you. Best defense against facts that you can't debate is to pretend they were never said...



I'm still waiting for Randy to answer my question about what he meant by "funny how the Fed can take 30 years to pay back less than $9 Billion but thinks that the USPS can pay $55 Billion in only 10 years."

Seems his "facts" (and/or semantics) are questionable, I'd hate to spend my time addressing them if he's prone to generalizing based on things he doesn't actually know using the wrong terms.

Don'tcha hate when that happens?

Please enlighten me then... what is the solution? If Congress is robbing the Postal Service, wouldn't the Postal Service want to ditch the bloodsucking bastards and make it on their own?

Hurry up and watch those premium-priced DVDs, Euchre. Won't be around long. Or maybe you can go get a stack of your favorites at the Blockbuster going-out-of-business sale (any thoughts on why they're going out of business?) and not have to pay extra to Netflix for what the wired world is getting. Maybe you'd do better to put that $2 toward WiFi for your teevee.

euchre said...

I've read through this thread 3 times and don't see where you asked that question, of anybody. So I'm guessing you're going to be waiting awhile for Randy's reply.

I'll answer it for you though. In the recent budget Obama gave fed 30 years to pay back 9 billion dollars, but with PAEA the USPS was required to pay 5.5 billion a year for 10 years. This is all on record. Not sure what you're even hoping for Randy to prove for you, but again, you never asked that question that I can see....

Ultimately you can make any conclusion you want about anything in life. But having a website and stating things on it doens't make you right... You spending 60% of your reply to his thought out post talking about using the word FUCK clearly showed you didn't really have an argument.

euchre said...

Lazypaper boy...thank you for confirming my suspicion that you did not have a point.

Was a pleasure...I think.

You two are funny. Actually assuming you're the same person at this point. I've only been here once previously, talking about how JR wasn't getting his mail, but assumed there was actual logical discussion on here. It clearly goes that way when there is agreement, but the tone you're taking when you have no idea what you're talking about is disappointing.


euchre said...

"wouldn't the postal service want to make it on their own". Sure, but why would the goverment let it? It's been a cash cow for years. Where do you think the 5.5 billion a year for FUTURE retirees benefits was going? Do you think it's sitting in a bank account earning the post office interest? It was going to the treasury for them to use as they saw fit.

Honestly, try to find that answer to that simple question and maybe you'll have a better understanding of what Randy was trying to tell you.



my first response to Randy:

"And what are you talking about the Fed having to pay back anything? NOW you're in my domain and they don't owe anyone shit.

February 17, 2011 3:15 PM"

Once again, if someone is going to get incensed over my creative use of "pensions" and the word Fuck, the least that person can do is also use the correct form of "Fed" as in "federal government" (as I assume he meant to say) over the "Federal Reserve" which would be the popular meaning of that word and the #1 topic here on my fuck-laden turf.

You are completely missing the point. I'm on your side here and every time I dare discuss any of these USPS budget stories, I get attacked by a pack of rabid mailmen. It almost makes a girl think she should go get cozy with some UPS guys who actually deliver when they say they will instead of trying to have this discussion with overly defensive postal workers.

euchre said...

No. I respectfully call BS on you being on my side. You're playing both sides. You're clearly anti USPS, or you wouldn't have the netflix picture up top. That picture wasn't put up to say "hey congress, set them free".

I could have a picture of a dog fucking a donkey in the ass and label them as Lazy paperboy and Jr Deputy, but I couldn't then say.."guys...we're cool"... lol.

I'm sleepy now. I have to go to bed so I can get up in the morning and have yet another day of perfect customer service. See, I'm an asshole, everybody knows that. I don't pretend that I'm not. The only customer complaints I've had in the last 16 years are people complaining when I'm not there "the regular is an asshole, but at least he delivers the mail right". And THAT is the best compliment I can ever get.

good night

There is hope for you yet, asshole.

You must feel the same about the point I'm trying to make or you wouldn't bother to stay up past your bedtime making yours to me.

Appreciate the discourse, even if you did just call me a jackass.

And I must be a dog. Pretty much perfect. And lazy, too.

W.C. Varones said...

Two things this thread illustrates:

1) why everybody hates mailmen


2) the psychology of a mailman before going postal

euchre said...

A) Where did I say I was up past my bed time? There you go making any conclusion you want on what people say. No wonder you're conveniently failing to grasp the points made by Randy.

B) Where did I say the paperboy was the dog in the picture? And to correct you on me calling you a jackass, i said "could". That clearly made it hypothetical. I don't think you're a jackass at all. You're just never wrong, and have the abiliity to spin a subjects contents to continue that trend. If YOU think that label fits that's up to you, but don't misrepresent what I said.

C) Not sure I have a point, I just disagree with yours (we have that in common, we just disagree to disagree)

D) Why is the new guy generalizing? "everybody"?

E) "goin postal"...good one. did you make that up?


Randy F said...

Ok, I am not sure I understand precisely what the question is but, I'll try.

Perhaps you might reconsider your statement of the Federal Government not owing anyone shit a little differently.

Would you agree that it has been acknowledged that the USPS has overpaid some $9 Billion into FERS by virtue of Obama including a repayment provision in his budget proposal? But allowing for repayment over 30 years is far less of a burden to any entity than requiring the payment of $55 Billion in 10 years. USPS is looking for a more reasonable term, like maybe 15 or 20 years. USPS is not looking to avoid paying in to this fund at all.

I don't disagree that the USPS would like to have less meddling by Congress in its day to day affairs. That will never happen though.

Keep an eye on the news over this summer as USPS attempts to close Post Offices. Almost anybody agrees that there are some Post Offices that should be closed. Just make sure it isn't the one that you use.

Many have called for USPS to streamline its operations. Again, look at the news when something is announced to shift the processing of mail from an underutilized facility to another. What inevitably happens is that the public voices concerns about a perceived delay in delivery of their mail and then, of course, the Congresman of the district affected gets involved and questions everything that went in to the decision by USPS. USPS pretty much ends up doing everything all over again to prove that the consolidation is warranted.

Sure, I would be just as devastated if it were announced that my facility were closing and I would be moved to another but, I would still have a job. Adjustments would have to be made just as I would have to do for any sort of major life event.

It's sort of funny if you think about it. Announce the proposed closing of a Post Office and many of the same people that claim that they don't use the mail anymore and pay their bills online etc. etc. will come out to protest the closing.

Others complain that the Post Office is the "only" place in small town USA where people from the village can meet and interact when retrieving their mail each day. Well, sorry, but the USPS is not mandated to provide a meeting place for the community to socialize.

It is never likely that the USPS will ever be severed from oversight by the Federal Government, nor should it be. The establishment of a system to delivery mail is set forth in the Constitution. This is what is behind the Private Express Statute.

However, it would be great if individual members of Congress would keep out of USPS affairs. That is what the PRC, Postal Regulatory Commission, is for. It would also be great if Congress disbanded the Committee on Postal Affairs. It really serves little purpose and what little it actually does can be better handled by the PRC.

Anxiously awaiting further replies.

Isn't there any mail to deliver where you two work? Some Netflix DVDs, maybe? You better get busy or "everybody" will think you're lazy. And that's my gig.

Randy F said...

Sorry Lazy Paperboy, I do not deliver mail and my scheduled start time has not yet arrived.

I am more than happy to debate with anyone. Anyone that will debate and not reduce the conversation to insults and personal attacks.

I think there is a good one going here. Maybe a couple of missteps off on a tangent, but really staying on point and expressing our different viewpoints.

I am pleased to be able to participate. Thanks Deputy.

Anonymous said...

Fact: the FEDEX (FedEx SmartPost) and UPS using the USPS to delivery their small packages every day

Randy F said...

FedEx SmartPost and UPS mail Innovations both use the USPS to deliver "the last mile", rural areas that they do not want to go to.

Conversely, USPS uses FedEx and UPS aircraft for transportation, as well as most all of the commercial airlines since USPS does not maintain its own fleet of aircraft.

This sybiotic relationship has been dubbed Coop-etition.

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