The USPS: Sweet Deal or Money Pit?

I’m taking the 10,000 foot view here, and taking the opportunity to discuss the USPS budget deficit since they are in the news. Forty-five is, not surprisingly, wrong about the contract with Amazon. But this gives us an opportunity to consider the USPS’s circumstances and ask if it is money well spent to endlessly bankroll this government entity.

The problem is that they are required to be self-sustaining and they are not, and they haven’t been since the invention of email, increasingly so every year. Yes, getting into the package business competitively, a decade or more too late, has helped, but they are still essentially bankrupt and are, ultimately, doomed. There will not be a need for their services very far into the future unless they find a way to get involved with secure electronic document delivery and they’ve seemingly missed that boat, too.

What other corporation gets to rest in its laurels while it’s competition takes its market share (again and again) and then get bailed out? What company gets to exempt their payroll expenses from their P&L? If payroll and benefits are included in the calculations, regardless of how they came to be, the USPS is operating at a loss, losing money from ALL their services and products.

Finally, we are asking for fair wages in other industries and trying to raise the ridiculously low Federal minimum wage, yet we begrudge postal employees their robust benefits package put in place largely due to one of the few remaining effective labor unions in the country? And the fact that their unions thought to demand the pensions be secured in a dying industry? Good on them. The USPS would be out of business if the treasury was not propping them up indefinitely.

So while 45 is wrong about the Amazon contract, it is true that the USPS is operating at a deficit and has been for a long time, contrary to its charter. Yes, tax dollars are being used to sustain postal operations, though you can play a shell game by saying it’s only for payroll, as if payroll is not a business expense. I’m not a fan of privatizing government operations, but maybe this one needs to be mothballed in favor of letting existing private sector alternatives have the remaining market share.

39 USC 101(d): Postal rates shall be established to apportion the costs of all postal operations to all users of the mail on a fair and equitable basis.

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