Postal Service - Death Imminent

**mikezila** · Nov 15 2012, 06:59 PM

Originally Posted by Jarlaxle

Horse manure! My local (I am, for the moment, an unwilling Teamster) includes two UPS facilities, and the last meeting I attended, EVERY UPS driver there was 40+! A couple were in their late 50's. The head of my local retired from UPS, he's in his early 60's.

no one in their right mind would keep delivering to door steps when a cushy road driver slot opens up. 4-5 hours out, drop, hook, 4-5 hours back...home for dinner. guys wait for someone to die for those jobs...i think it pays more an hour too.

**Jarlaxle** · Nov 15 2012, 07:11 PM

The head of my local was a "package car" driver until he retired...he never did line haul. Can't say about the others.

**Yosh Shmenge** · Nov 15 2012, 07:28 PM

Originally Posted by Brewskier

Most people would. However, like I said, the true cost of sending a stamp through the post office is much higher than what you've been saying.

It costs exactly what it costs.

The only reason they get the cost that low is because they are not paying their liabilities. It would be easy for companies to charge an extremely low price when they don't factor in their costs into their products. The private sector doesn't operate that way, and neither should the post office.

Let me tell you again, and for the last time, that the private sector also doesn't have congress forcing them to pay onerous pre paid installments on their pension liabilities that no other government entity is required to
pay. Do you suppose you would have as much money as your neighbors if you alone, for some reason, had to pay your
property taxes ten years in advance?

False for reasons already given. They have to fund their liabilities or else they would need a taxpayer funded bailout within 10 years. The Post Office has been running an unsustainable business model for a long time and it finally came to a head. Getting the problem in control now is better than waiting for it to become a full blown financial crisis and then dealing with the problem, which is what you seem to prefer.

You sound like a broken record playing the same mistaken tune over and over again.
http://www.guernicamag.com/daily/dav...ancial-crisis/
This tells a very different story. Go ask Issa about it.

Of course, the best way to deal with the problem is to stop offering pensions to future employees, or at least substantially less generous plans, but you seem to be of the mindset that the postal workers won't do a good job unless they have a pension waiting for them after 20-25 years of service, which I think is nonsense. Most of the private sector is getting used to the idea that pensions won't be there for them, the Government should too. There's no sense in having public sector workers getting better benefits than the private sector workers who fund them.

If a deadline was set after which new employees entered the service with less "generous" pensions (though that's a loaded term) I would agree but I could guarantee the work force would
be lesser in every way and it's already happening. "In an attempt to shore up it's already $11.6 billion budget shortfall this year, the Postal Service has closed 500 post offices, cut operating hours another 13,000, and bumped 9,000 employees down to part time with no benefits.

So what if it's a "de facto business site" (whatever that means)? The Post Office is a business, isn't it? If you're going to try and dismiss sources you don't agree with, you could at least give a better answer than "it's partisan, so I won't listen to it". A "balanced picture". Gee, that sounds like Obama's "balanced approach" to dealing with the deficit. It's sad to see "conservatives" talking like progressives.

Sometimes they are right. http://thinkprogress.org/economy/201...elf/?mobile=nc

Feel free to post evidence that the Committee on Oversight and Government Reform is wrong. Dismissing the source as "biased" without giving a convincing explanation is not a legitimate rebuttal.

I've told you many times why they are wrong. Why do act like I've not given any reasons? Issa is spinning a tale that just isn't so in order to deconstruct the post office and sell it off.

That's not true at all. The problems with the Post Office really started in the 90's when email started taking away business from the Post Office. This has only gotten worse as time went on. People use the Post Office far less now than they did in the past. The reason the law was enacted in 2006 was because the Post Office had accumulated liabilities that would, if not addressed, require a taxpayer funded bailout within a decade.

Is that what Issa told you?

Congress wanted to avoid this, so they required the Post Office to pay down their liability burden until 2017, when they would have essentially "caught up" after allowing the problem to grow for many years.

So the post office was the only governmental entity running up a deficiit so congress enacted this special law forcing them to pre fund their pensions (which again, no one else had to do)? Is that what you want me to believe? I don't.

Strawman. I never said "the free market can do everything better". Maybe don't start off with a false premise if you want a genuine answer to your questions.

Free market solutions. That was your claim. I believe in the free market myself...just not in cases where it's obviously not applicable (like providing a nation wide service).

It's not simple at all. You're intentionally ignoring contrary evidence to support your narrative that it's a simple issue, but that doesn't make it so.

Tell yourself that. It's what you are doing.

If a private sector company can't pay its liabilities down the line, it will go out of business and liquidate. The only people on the hook would be shareholders. If the Post Office can't pay its liabilities it needs to get bailed out by the taxpayer. Big difference.

If the post office weren't saddled with this artificial solution to a problem it has now caused there would be no problems with liabilities. As you see the "solution" is the problem. "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."

Actually, I called it a dismissal first, which is what it is. It doesn't really matter if the rates are set by different agencies or not, the argument is that the rates the Post Office is charging customers for its services is not a realistic cost when they are not bringing in enough revenue to pay its liabilities. Like our entitlement program, they overpromised benefits that will not be there in the future unless changes are made now. If the Post Office wishes to give its employees pensions, then they should be able to pay for it without being bailed out by the taxpayer.

Maybe rates should be raised then.

That's because it's a stupid question. Why would a company "step up" and announce it can do what the Post Office does when the Post Office still exists?

In order to create a demand to close up the Post Office and gain some of the business.
Why else?

"Bush Republican"? If anything, you're the Bush Republican, here, with your "deficits don't matter" mentality. Just another weak, baseless jab from Yosh.

I've never claimed deficits don't matter.

Wrong again. The USPS was not "OK" up until 2006. If it was, they wouldn't have passed the law in the first place.

Your entire rationale is based on this assumption? That's nice.

They realized the Post Office was going to be in trouble down the line and they took preventative measures to address the situation. This conservative forward-thinking approach should be done with our entitlements as well if we wish to have our social safety net for the future.

If this is so, which I don't grant, they have merely exaserbated the problem.
I'm through with this subject now. I don't have the time to care anymore.

**The Wyrd of Gawd** · Nov 15 2012, 08:16 PM

Originally Posted by coolguybrad

http://www.bloomberg.com/news/2012-1...9-billion.html

The U.S. Postal Service said its net loss last year widened to $15.9 billion, more than the $15 billion it had projected, as mail volume continued to drop, falling 5 percent.

Without action by Congress, the service will run out of cash on Oct. 15, 2013, after it makes a required workers compensation payment to the U.S. Labor Department and before revenue typically jumps with holiday season mailing, Chief Financial Officer Joe Corbett said.

Why do we keep subsidizing this mess? Its failed, time to slim and trim, and move on.

Running the post office is one of the specific things Congress is charged to do.

Maybe Obama will ask Romney to run it since Romney has so much business experience.

**Brewskier** · Nov 15 2012, 08:31 PM

Originally Posted by Yosh Shmenge

It costs exactly what it costs.

Charging you 45 cents and charging the taxpayer for the remaining amount isn't a 45 cent cost.

Let me tell you again, and for the last time, that the private sector also doesn't have congress forcing them to pay onerous pre paid installments on their pension liabilities that no other government entity is required to
pay. Do you suppose you would have as much money as your neighbors if you alone, for some reason, had to pay your
property taxes ten years in advance?

If I owned a business and understated my liabilities the way the Post Office has, I'd probably get audited and punished by the IRS.

Here's a good analysis of what's been going on

Imagine you have a company with only one employee, Steve. If Steve earns a salary of $50,000 and receives no benefits, you have to pay him cash in the current period and reflect the whole $50,000 as an expense.

Now imagine that instead you pay Steve $45,000 a year and promise to pay for his health care in retirement, assuming that he works for a certain number of years. The present value of the health care benefits that Steve will accrue this year is $5,000.

Your employment expenses are still $50,000 a year, even though you had only $45,000 in actual cash outflows to Steve. Whether or not you set aside money to cover Steve's future health-care costs, you incurred a debt to him, and that's an expense.

Unfortunately, most government entities do not treat the accrual of retiree health-care liabilities as a cost (though they do report the size of the liability). Private firms do treat these accruals as costs. These firms are not legally obligated to pre-fund health-care benefits, but about a quarter do so.

Now imagine that Steve is nearing retirement, and all along you had been promising him health benefits but hadn't set aside any money. In order to reach full funding by the time Steve retires, you would now have to set aside $15,000 per year: $5,000 for the benefits he accrues and $10,000 to build up the fund you never created.

Your extra $10,000 payment amortizes a debt you had accrued in past years; it's not an expense any more than paying off principal on a loan is an expense.

Now let's look at how this example applies to the Postal Service. Until 2006, the USPS handled its retiree health benefits on a "pay as you go" basis. They weren't pre-funded; the service simply paid retirees' health bills as they arose, reporting only those expenses. Because the cost of actually providing health care to retirees in a given year is less than the value of benefits current workers are accruing, that meant the post office was understating the cost of retiree health care.

http://www.bloomberg.com/news/2012-0...fits-mess.html

You're acting like Congress did this to the Post Office just to be mean. Now, the article does go on to say that the required amount a year is excessive, and that the real amount should be lower. If that's true, on that I can agree.

You sound like a broken record playing the same mistaken tune over and over again.
http://www.guernicamag.com/daily/dav...ancial-crisis/
This tells a very different story. Go ask Issa about it.

So David Morris' opinion is worth more than Issa's? And I have been quoting from the Committee on Oversight and Government Reform, by the way.

If a deadline was set after which new employees entered the service with less "generous" pensions (though that's a loaded term) I would agree but I could guarantee the work force would
be lesser in every way and it's already happening. "In an attempt to shore up it's already $11.6 billion budget shortfall this year, the Postal Service has closed 500 post offices, cut operating hours another 13,000, and bumped 9,000 employees down to part time with no benefits.

Definitely sad, but it's what happens when demand evaporates for a product or service.

Sometimes they are right. http://thinkprogress.org/economy/201...elf/?mobile=nc

Yikes.

I've told you many times why they are wrong. Why do act like I've not given any reasons? Issa is spinning a tale that just isn't so in order to deconstruct the post office and sell it off.

I've seen no evidence to support that theory.

Is that what Issa told you?

No, it's what the Committee on Oversight and Government Reform told me, and you have yet to give a convincing reason why they cannot be relied on.

So the post office was the only governmental entity running up a deficiit so congress enacted this special law forcing them to pre fund their pensions (which again, no one else had to do)? Is that what you want me to believe? I don't.

The Post Office isn't like other branches of Government. It was designed to be a self-sustaining entity, and it won't be if it becomes dependent on taxpayer bailouts.

Free market solutions. That was your claim. I believe in the free market myself...just not in cases where it's obviously not applicable (like providing a nation wide service).

So, to reiterate, I never said "the free market can do everything better" like you claimed I did.

Tell yourself that. It's what you are doing.

I disagree with your opinion.

If the post office weren't saddled with this artificial solution to a problem it has now caused there would be no problems with liabilities. As you see the "solution" is the problem. "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."

If they didn't prefund their liabilities they could have showed a "profit" for that year but at the same time, their unfunded liability problem with retiree pensions would have continued to grow. Businesses can't afford to ignore things like that if they want to stay in business.

Maybe rates should be raised then.

Rates have been increasing, and they are considering another increase in the near future.

In order to create a demand to close up the Post Office and gain some of the business.
Why else?

They wouldn't, considering the Post Office has monopolies on non-urgent letters and access to customer's mailboxes.

I've never claimed deficits don't matter.

I never said you did.

Your entire rationale is based on this assumption? That's nice.

So are you saying the Postal Service had no problem with unfunded liabilities? Congress just passed the law out of the blue to screw over the Post Office?

If this is so, which I don't grant, they have merely exaserbated the problem.
I'm through with this subject now. I don't have the time to care anymore.

As am I. We don't agree.

**LasMa** · Nov 15 2012, 11:04 PM

Originally Posted by Brewskier

Let it die. The private sector will handle mail delivery better and more efficiently.

No. The private sector will handle mail delivery where it is PROFITABLE. If mail delivery is ever privatized, rural America can kiss its low-cost daily mail goodbye.

**The Wyrd of Gawd** · Nov 16 2012, 12:19 AM

Originally Posted by Brewskier

The Post Office isn't like other branches of Government. It was designed to be a self-sustaining entity, and it won't be if it becomes dependent on taxpayer bailouts.

Postal services are an integral part of every national government in the world. The problem with the American postal service is that Congress has been screwing with it since the Civil War. Even Third World countries take their postal service seriously. The clowns in Congress have been trying to kill ours for 147 years.

**Meta777** · Nov 16 2012, 12:34 AM

Originally Posted by Brewskier

Charging you 45 cents and charging the taxpayer for the remaining amount isn't a 45 cent cost.

You do know that the post office is funded by postage and not tax dollars, right? Don't you? Well don't you?.... :/

**Ctrl** · Nov 16 2012, 12:44 AM

Originally Posted by LasMa

No. The private sector will handle mail delivery where it is PROFITABLE. If mail delivery is ever privatized, rural America can kiss its low-cost daily mail goodbye.

How relevant is low cost daily mail in today's world?

I pay most of my bills online... I certainly communicate with friends and family in a digital medium... most of what comes through my mail is junk. It would interfere with my netflix thing... but that is really the ONLY place I see an impact in my life if the post office simply didn't exist tomorrow.