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Financially Strapped Post Office Asking For Help

 
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Pillar Of The Community
Philippines
1132 Posts
Posted 03/25/2009   11:29 am  Show Profile Bookmark this topic Add johnstamp to your friends list Get a Link to this Message
Financially strapped post office asking for help

http://news.yahoo.com/s/ap/20090325.../postal_woes

WASHINGTON Postmaster General John Potter says that without help, the U.S. Postal Service will run out of money this year.

Potter told a House subcommittee Wednesday the lingering question is: Which bills will get paid and which will not.

He said he will make sure that salaries are paid, but also said other bills might have to wait. Potter is seeking permission to reduce mail delivery to five days a week and wants to reduce other costs.

He said the post office is "facing losses of historic proportion. Our situation is critical."

The post office was $2.8 billion in the red last year and is facing even larger losses this year due to the sharp decline in mail volume in the weak economy.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

WASHINGTON (AP) The post office is facing a severe financial crisis that will not ease any time soon, Postmaster General John Potter told a House subcommittee Wednesday.

"We are facing losses of historic proportion. Our situation is critical," Potter said in seeking permission to reduce the number of days mail is delivered each week, an idea he first broached in January.

The post office was $2.8 billion in the red last year and is facing even larger losses this year due to the sharp decline in mail volume in the weak economy.

Potter raised the possibility of cutting mail delivery from six days-a-week to five in January but the idea has not been warmly received in Congress.

"With the Postal Service facing budget shortfalls the subcommittee will consider a number of options to restore financial stability and examine ways for the Postal Service to continue to operate without cutting services," subcommittee chairman Stephen F. Lynch, D-Mass., said.

Lynch said the financial stability of the Postal Service is "critical to the American expectation of affordable six-day mail delivery."

The post office is also seeking changes in its required pre-funding of medical costs for retirees that could cut its annual costs by $2 billion, a move endorsed by several subcommittee members.

"We are not here today to ask for a taxpayer bailout, but we are here to ask the Congress for help," William Young, president of the National Association of Letter Carriers, said in his prepared testimony.

"At this moment, the survival of the Postal Service a venerable institution that is literally older than our country hangs in the balance," Young said.

Even if the agency succeeds in reaching its planned cost cuts of $5.9 billion, there could still be a $6 billion deficit in 2010, Potter told the House Oversight subcommittee on the federal work force and Postal Service.

"Without a change we will exhaust our cash resources," Potter said. "We can no longer afford business as usual."

He estimated that delivering mail five days-a-week instead of six would save $3.5 billion per year.

Last week the post office said it plans to offer early retirement to 150,000 workers and is eliminating 1,400 management positions and closing six of its 80 district offices across the country in cost-cutting efforts.

Dan Blair, head of the independent Postal Regulatory Commission, suggested in his testimony that other savings could be realized through closing small and rural post offices something Congress has resisted in the past. He added that it may be necessary to increase the limit on the amount of debt the post office can carry.

The post office had a $384 million loss in the first quarter of the fiscal year October through December which is usually the busiest period because of the holidays.

Officials said the economic recession contributed to a mail volume drop of 5.2 billion pieces compared to the same period last year. If there is no economic recovery, the USPS projects volume for the year will be down by 12 billion to 15 billion pieces of mail.

Over the past year the post office says it has cut 50 million work hours, stopped construction of new facilities; frozen salaries for executives, begun selling unused facilities and has cut post office hours.

Last year's high fuel prices also sucked funds away from the post office, which operates more than 200,000 vehicles. Every one-cent increase in the price of fuel costs the post office $8 million.

Blair also noted that Congress could consider appropriating money to help the post office. Currently the agency does not receive a taxpayer subsidy for its operations, although Congress does subsidize overseas voting and free mail for the blind.

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United States
4740 Posts
Posted 03/25/2009   12:26 pm  Show Profile Bookmark this reply Add kirks to your friends list  Get a Link to this Reply
If they shut down, my U.S. collection will be worth a fortune

Just kidding about that, it's hard to convey humor in print. But I know this is a VERY serious issue; and a complex one. I don't know the answers, but I am really concerned - about the Post Office, indeed, about our entire government.

I've read a few articles about five-day delivery in Linn's. I thought they might eliminate Saturday delivery, but Potter said that was the only day for many people to have contact with their mail carrier. As I recall, he preferred Tuesday, the lowest volume day, be eliminated.

I wonder how the Post Office compares to the U.S. Mint. Have their recent initiatives (state quarters, presidential dollars, Lincoln cents, etc) been profitable? Or am I comparing Apples and Oranges?

Anyway, it's a serious issue for smart minds. I hope a good solution emerges.

KirkS
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Pillar Of The Community
USA
3315 Posts
Posted 03/25/2009   6:27 pm  Show Profile Bookmark this reply Add laswabbie to your friends list  Get a Link to this Reply
I'm sure the union and members will get right behind having Sunday and Tuesday off.

For those of you who didn't recognize it - that was sarcasm.
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Pillar Of The Community
USA
2502 Posts
Posted 03/25/2009   7:56 pm  Show Profile Bookmark this reply Add modern_who to your friends list  Get a Link to this Reply

Quote:
I'm sure the union and members will get right behind having Sunday and Tuesday off.


Might even lead to more shootings. Things have been too quiet lately.
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Larry, APS Member

Modern-Vue Stamps on eBay
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United States
4740 Posts
Posted 03/25/2009   8:14 pm  Show Profile Bookmark this reply Add kirks to your friends list  Get a Link to this Reply
OUCH, m_w...

to think, I was worried about my mild sarcasm
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Pillar Of The Community
Philippines
1132 Posts
Posted 03/25/2009   8:41 pm  Show Profile Bookmark this reply Add johnstamp to your friends list  Get a Link to this Reply
hehehe :}
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Pillar Of The Community
USA
2502 Posts
Posted 03/26/2009   12:16 am  Show Profile Bookmark this reply Add modern_who to your friends list  Get a Link to this Reply

Quote:
WASHINGTON Postmaster General John Potter says that without help, the U.S. Postal Service will run out of money this year.


Bad karma for those non-soakable self-adhesive stamps!
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Larry, APS Member

Modern-Vue Stamps on eBay
Pillar Of The Community
United States
2757 Posts
Posted 03/26/2009   12:25 am  Show Profile Bookmark this reply Add warrehouse to your friends list  Get a Link to this Reply
Maybe just another way of going postal.
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United States
4740 Posts
Posted 03/26/2009   3:39 pm  Show Profile Bookmark this reply Add kirks to your friends list  Get a Link to this Reply

Quote:
Bad karma


That's funny. On the way home, I saw a bumper sticker reading,

Karma: It's Everywhere You're Going to Be

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Pillar Of The Community
Philippines
1132 Posts
Posted 03/26/2009   3:41 pm  Show Profile Bookmark this reply Add johnstamp to your friends list  Get a Link to this Reply
For me, maybe people would use the postoffice more if the service is improved. I have had experiences where my letter never reached the destination
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Pillar Of The Community
Israel
6191 Posts
Posted 03/27/2009   05:50 am  Show Profile Bookmark this reply Add Londonbus1 to your friends list  Get a Link to this Reply
Why don't they just issue loads more stuff for collectors to buy, like they do in Britain, then they should be OK.

The last thing Royal Mail [UK] would ever do is freeze pay for executives ! Whatever next
Better to stuff those poor obedient collectors with new unwanted, never-to-be-used-for-postal-purposes, new issues. A great source of revenue.

Londonbus1.....Gave up GB with the unsoakables
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Valued Member
54 Posts
Posted 03/27/2009   09:15 am  Show Profile Bookmark this reply Add stampydampy to your friends list  Get a Link to this Reply
I agree Londonbus...very informative article nevetheless
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