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(The Hill)   Postal Service to default again. Official papers sent by USPS so that should give them at least another 6-8 months   (thehill.com) divider line 7
    More: Fail, postal services, U.S. Postal Service  
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767 clicks; posted to Business » on 27 Sep 2012 at 3:41 AM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-09-27 06:55:32 AM
2 votes:

optikeye: I've always had great service from USPS. Never had anything lost or misplaced--unlike fedex or UPS.

The Republican Congress wanted to get rid of USPS..so they put a large amount of debt on them by making them fund retirement programs in each years budget and put that away instead of putting it retirement funds....as all other corporations do. Except the USPS was required to have the cash "on hand" for 75 years into future; that is what is killing them. Instead of putting those funds even into low interest acct would fund those retirement accts..instead of it in year to year budget.

No other corporation is required to take money out of accounts to fund things for 75 years..without putting those funds into investment, or low interest accounts.

Basically, the GOP wanted USPS gone..and came up with a sneaky way in 2006 to make it happen.


The extra added irony here is that the existence of the USPS is mandated by the very Constitution
that the GOP-tards seem to regard as unchangable holy writ.
2012-09-27 04:49:59 AM
2 votes:

Lt_Ryan: The house at the time was controlled by the Democrats and the bill in question was passed by a vote of 410 to 20, it passed the Republican senate by a voice vote. You can try to spin Republican but the Democrats voted for it as well.


Actually, it was signed by Bush and passed through the House unanimously, and by the Senate through a voice vote. The ayes and nays were not recorded per Congressperson. Both the House and Senate were both still under GOP control even though the Democrats had won in November, because that's how elections work. So yes, the Democrats helped pass this atrocity, but it was devised by the Republicans.
2012-09-27 02:33:18 AM
2 votes:
USPS has lost billions of dollars in recent years, both due to new technology and the downbeat economy.

Postal unions and some on the left also chalk up many of the agency's financial woes to what they call the unneeded prepayments for retiree healthcare.

In all, the agency lost $5.1 billion in fiscal 2011, even without having to make a healthcare payment. The Aug. 1, 2012, default came only after Congress pushed back the due date on that particular payment, which was originally due at the end of September 2011.


Not sure how to reconcile that with this:

As consumer advocate Ralph Nader noted, if PAEA was never enacted, USPS would actually be facing a $1.5 billion surplus today:
By June 2011, the USPS saw a total net deficit of $19.5 billion, $12.7 billion of which was borrowed money from Treasury (leaving just $2.3 billion left until the USPS hits its statutory borrowing limit of $15 billion). This $19.5 billion deficit almost exactly matches the $20.95 billion the USPS made in prepayments to the fund for future retiree health care benefits by June 2011. If the prepayments required under PAEA were never enacted into law, the USPS would not have a net deficiency of nearly $20 billion, but instead be in the black by at least $1.5 billion.
2012-09-27 10:12:00 AM
1 votes:
Ok, after some quick research, here's what is going on with USPS as best I can tell. In 2006, the prefunding bill was passed, which required USPS to make ten annual payments of $5.5B each to prefund the pensions for the next 75 years. They made the first few, but after the financial crisis, they were too short of cash to make the 2011 one, so they got an extension until August of this year. So, no payment in 2011, and two payments due in 2012. They were unable to make the August payment (left over from 2011) and now they're announcing that they're not going to be able to make the 2012 payment, either.

Now, here's the rub: That 2006 bill imposed a prefunding obligation of $90.3B to completely cover all the benefits. Of that total, $44.1B has already been paid as of the end of fiscal 2011 according to an Inspector General report from last June. And the formula used to calculate the pension cost wasn't set up correctly - USPS has actually paid 105% of its pension costs since the bill was enacted, resulting in a surplus of pension payments of $13.1B, according to the same IG report.

Now, about profits and losses: For the first four years after the prepayment bill was passed, the USPS would have turned a roughly $1B profit without the prepayments. Since then, however, revenues have been dropping like a stone, with a major loss (at least $5.7B, as best I can tell) for fiscal 2011 and an $11.6B loss for the first three quarters of fiscal 2012. Mail volume has dropped 3.6% this year, which is a large reason why.

So, USPS has called for several changes - an $11B refund of the pension overage, changing the product mix (to offer office supplies and the like, more like a mailbox store), five day delivery, change the prefunding requirement, and redesign the worker's comp system by having the USPS pull out of the federal plan and set up its own. The union is opposed to the worker's comp changes and going to five day delivery, but supports the other measures. The Senate has currently passed a bill to implement some of this, but the house hasn't done anything at all. There's hope that it will get taken up in the lame duck session, but with sequestration also being addressed, it's more likely to get tossed to the next congress.
2012-09-27 04:22:14 AM
1 votes:
Tthe overall problem is this uncomforable, half-private half-public structure. I do believe that anything the government touches turns into a bloated inefficient mess, but if you're going to require service equal in cost and extent to every person in the country regardless of costs to provide, it's already a fully social service; attempts to pretend otherwise will only cost money.
2012-09-27 04:13:27 AM
1 votes:
For those unaware, the USPS is required to turn a profit while at the same time required to do things that UPS, FedEx, et al say will bankrupt anyone. Things like providing a fully staffed post office, open six days per week, for every cluster of people across the US. Daily delivery to residential properties many tens of miles apart at the same cost as daily deliveries to thousands of people in a single building. And my favorite, snail mail spam paid for by the USPS because it puts money into the pockets of congressmen.

It's like requiring an Olympic sprinter to compete using a potato sack (both legs must remain within the bag), while their competitors not only don't have any such requirement, they get a 10 second head start. And they're only racing 100m.
2012-09-27 03:25:34 AM
1 votes:
I've always had great service from USPS. Never had anything lost or misplaced--unlike fedex or UPS.

The Republican Congress wanted to get rid of USPS..so they put a large amount of debt on them by making them fund retirement programs in each years budget and put that away instead of putting it retirement funds....as all other corporations do. Except the USPS was required to have the cash "on hand" for 75 years into future; that is what is killing them. Instead of putting those funds even into low interest acct would fund those retirement accts..instead of it in year to year budget.

No other corporation is required to take money out of accounts to fund things for 75 years..without putting those funds into investment, or low interest accounts.

Basically, the GOP wanted USPS gone..and came up with a sneaky way in 2006 to make it happen.
 
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