Postal Service on brink of bankruptcy

There are no easy answers, but our mail still gets delivered

Topics: government spending, POstal service, bankruptcy, , ,

Postal Service on brink of bankruptcy
This story has been corrected since it was originally published.

The U.S. Postal service has lost $16 billion in the last year and $41 billion in the last five. Without a bailout this year it will go bankrupt, the Guardian’s Heidi Moore reports.

The dire situation stems from a drop in mail volume, unusual pension requirements that require it to pre-fund worker benefits and the lack of authority to price postage based on market rates (it’s pegged to inflation):

Richard Geddes, an assistant policy professor at Cornell and an American Enterprise Institute scholar who has studied the postal service, says first class mail has fallen from 103bn pieces in 2000 to just around 74bn pieces in 2011.

Even though it has shrunk from nearly 900,000 thousand employees in 1998 to about 530,000 now, many regulators and lawmakers see the US Postal Service’s infrastructure as inefficient, and have talked about areas they would like to cut – the number of facilities that the USPS uses to process mail, for instance.

…The postal service has reached its $15bn credit limit with the US Treasury, and has in effect run out of money.”This is the year that they borrowed so much that they can’t borrow any more,” [USPS Inspector General David] Williams said.



Some of the options that get discussed include privatization — Germany’s mail is a private service — and keeping it on government life support with additional bailouts. The latter option, which would likely include benefit cuts for unionized workers, offers something for everyone to hate.

With younger people having less and less need to use the mail, or perhaps barely even aware that it exists, volume appears likely to continue dropping and the financial situation is unsustainable: “For the past five years it has been borrowing from the Treasury to pay the Treasury,” the paper said.

Alex Halperin

Alex Halperin is news editor at Salon. You can follow him on Twitter @alexhalperin.

Featured Slide Shows

7 motorist-friendly camping sites

close X
  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 9

Sponsored Post

  • White River National Forest via Lower Crystal Lake, Colorado
    For those OK with the mainstream, White River Forest welcomes more than 10 million visitors a year, making it the most-visited recreation forest in the nation. But don’t hate it for being beautiful; it’s got substance, too. The forest boasts 8 wilderness areas, 2,500 miles of trail, 1,900 miles of winding service system roads, and 12 ski resorts (should your snow shredders fit the trunk space). If ice isn’t your thing: take the tire-friendly Flat Tops Trail Scenic Byway — 82 miles connecting the towns of Meeker and Yampa, half of which is unpaved for you road rebels.
    fs.usda.gov/whiteriveryou


    Image credit: Getty

  • Chattahoochee-Oconee National Forest via Noontootla Creek, Georgia
    Boasting 10 wildernesses, 430 miles of trail and 1,367 miles of trout-filled stream, this Georgia forest is hailed as a camper’s paradise. Try driving the Ridge and Valley Scenic Byway, which saw Civil War battles fought. If the tall peaks make your engine tremble, opt for the relatively flat Oconee National Forest, which offers smaller hills and an easy trail to the ghost town of Scull Shoals. Scaredy-cats can opt for John’s Mountain Overlook, which leads to twin waterfalls for the sensitive sightseer in you.
    fs.usda.gov/conf


    Image credit: flickr/chattoconeenf

  • Nordhouse Dunes Wilderness Area via Green Road, Michigan
    The only national forest in Lower Michigan, the Huron-Mainstee spans nearly 1 million acres of public land. Outside the requisite lush habitat for fish and wildlife on display, the Nordhouse Dunes Wilderness Area is among the biggest hooks for visitors: offering beach camping with shores pounded by big, cerulean surf. Splash in some rum and you just might think you were in the Caribbean.
    fs.usda.gov/hmnf


    Image credit: umich.edu

  • Canaan Mountain via Backcountry Canaan Loop Road, West Virginia
    A favorite hailed by outdoorsman and author Johnny Molloy as some of the best high-country car camping sites anywhere in the country, you don’t have to go far to get away. Travel 20 miles west of Dolly Sods (among the busiest in the East) to find the Canaan Backcountry (for more quiet and peace). Those willing to leave the car for a bit and foot it would be remiss to neglect day-hiking the White Rim Rocks, Table Rock Overlook, or the rim at Blackwater River Gorge.
    fs.usda.gov/mnf


    Image credit: Getty

  • Mt. Rogers NRA via Hurricane Creek Road, North Carolina
    Most know it as the highest country they’ll see from North Carolina to New Hampshire. What they may not know? Car campers can get the same grand experience for less hassle. Drop the 50-pound backpacks and take the highway to the high country by stopping anywhere on the twisting (hence the name) Hurricane Road for access to a 15-mile loop that boasts the best of the grassy balds. It’s the road less travelled, and the high one, at that.
    fs.usda.gov/gwj


    Image credit: wikipedia.org

  • Long Key State Park via the Overseas Highway, Florida
    Hiking can get old; sometimes you’d rather paddle. For a weekend getaway of the coastal variety and quieter version of the Florida Keys that’s no less luxe, stick your head in the sand (and ocean, if snorkeling’s your thing) at any of Long Key’s 60 sites. Canoes and kayaks are aplenty, as are the hot showers and electric power source amenities. Think of it as the getaway from the typical getaway.
    floridastateparks.org/longkey/default.cfm


    Image credit: floridastateparks.org

  • Grand Canyon National Park via Crazy Jug Point, Arizona
    You didn’t think we’d neglect one of the world’s most famous national parks, did you? Nor would we dare lead you astray with one of the busiest parts of the park. With the Colorado River still within view of this cliff-edge site, Crazy Jug is a carside camper’s refuge from the troops of tourists. Find easy access to the Bill Hall Trail less than a mile from camp, and descend to get a peek at the volcanic Mt. Trumbull. (Fear not: It’s about as active as your typical lazy Sunday in front of the tube, if not more peaceful.)
    fs.usda.gov/kaibab


    Image credit: flickr/Irish Typepad

  • As the go-to (weekend) getaway car for fiscally conscious field trips with friends, the 2013 MINI Convertible is your campground racer of choice, allowing you and up to three of your co-pilots to take in all the beauty of nature high and low. And with a fuel efficiency that won’t leave you in the latter, you won’t have to worry about being left stranded (or awkwardly asking to go halfsies on gas expenses).


    Image credit: miniusa.com

  • Recent Slide Shows

  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 9

Comments

23 Comments

Comment Preview

Your name will appear as username ( settings | log out )

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>