USPS Posts $5.1 Billion Loss for Last Year
- Posted on November 15, 2011 at 4:40pm by
Becket Adams
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The U.S. Postal Service says it lost $5.1 billion last year as a weak economy and increased Internet use drove down mail volume.
Losses will only accelerate in the coming year, Postmaster General Patrick Donahoe warned, citing faster-than-expected declines in first-class mail. He implored Congress to take swift, wide-ranging action to stabilize the ailing agency’s finances as it nears a legal deadline Friday to pay $5.5 billion into the U.S. Treasury for future retiree health benefits.
Congress is expected to grant a reprieve, but that will only delay the day of reckoning for an agency struggling for relevance in an electronic age. Based on current losses, the Postal Service says it will run out of money — or come dangerously close — next September, forcing it to halt service.
“We are at a point where we require urgent action,” Donahoe said.
Postal officials called the financial situation “dire.”
They say the Postal Service will not be able to make the $5.5 billion payment due this Friday due to low cash flow. Postmaster General Patrick Donahoe has warned of a postal shutdown next year unless there is congressional action to address the agency’s long-term money problems.
The loss of $5.1 billion was less than a previous estimate of $10 billion, but only because the $5.5 billion payment — originally due Sept. 30 — was deferred until Nov. 18 with the approval of Congress.
In 2010, losses totaled $8.5 billion.
Recall that in September of this year, The Blaze reported on the financial crises facing the USPS:
Currently, labor costs represent 80 percent of the agency’s expenses (as opposed to UPS’ 53 percent and Fedex’s 32 percent) and costs continue to rise and grow with the help of such incredibly, unthinkably harmful provisions as the “no-layoff” clause in union contracts.
Moreover, it has been discovered recently that the USPS has overpaid an estimated $60 billion into its employee pension plans.
You read that correctly. $60 billion. Extremely generous benefits, employees that cannot be fired, and $60 billion overpaid in pensions.
At the time that article was written, these were the issues killing the agency. Based on the fact that the USPS will default on Friday’s payment, it sounds as if things haven’t improved.
The Associated Press contributed to this story.
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Comments (63)
cobra two
Posted on November 15, 2011 at 9:38pmA fine example of the Government at work! Doing what the do BEST ******* away money!
Report Post »The goverment could not even make a profit running a whore house in Nevada. How bout that boys and girls? I say close the damn post office.They can then say they saved 5 BILLION
NOBama2012
Newsphotog6801
Posted on November 15, 2011 at 9:52pmIt’s congress that has mandated they over pay the retirement fund by 60 billion, so they are not losing money it just goes into the big black hole that is our governemnet
Report Post »Marine 1
Posted on November 15, 2011 at 10:24pmBig surprise with this information. The last time I went into the Post Office they had two people working the front and one was heading out on break with a long line of people needing to be assisted. This is what happens when the unions run things with the approval of the government. The United States Postal Service has fallen from being a good operation back in the ‘60’s and ‘70’s to being a bloated, union-run, bankrupt, sorry service provider. Thank heaven for email! Just costs me a little electricity.
Time to close the USPS and privatize any mail service that is needed. Taxpayers are tired of supporting an operation that is not working and is not financially solvent. Oh, that just about covers 50% of everyone and everything in this country now. Especially the illegals! (Thought I’d throw that in for good measure.)
If the USPS was a horse I’d have to shoot it and put it out of its misery.
AMTRAK and the USPS — losers big time.
Report Post »jhrusky
Posted on November 16, 2011 at 9:39amIt is time to privatize the US Postal Service. While there needs to be some sort of regulation in place to ensure mail gets delivered, it is high time to stop with the nonsense of this group of ignorant people who quite obviously cannot run a business and put entrepreneurs in there who know how to run business without needing to attach themselves to the government teat.
Report Post »lukerw
Posted on November 16, 2011 at 10:00amLooks to me like… FEDEX should take it over!
Report Post »smithclar3nc3
Posted on November 16, 2011 at 10:30amThey have two choices end home delivery and require everyone get a p.o box or charge the p.o. box fee for home delivery.
Report Post »weeblewacker1
Posted on November 16, 2011 at 10:40ambetter check again cobra,the postal service is no longer a government agency,also the biggest reason for there trouble is due to ronnie raygun.go check.
Report Post »Secret Squirrel
Posted on November 17, 2011 at 12:00pm.
Report Post »Here’s the dirty secret.
The “Forever stamp” was a giant success.
The USPS took in billions, then spent it.
Now, the chickens are coming home to roost.
People are mailing letters, and the PO has no income.
thegreatcarnac
Posted on November 15, 2011 at 9:15pmThe mail service is racist. The only people I usually see working for the Postal service are negros and ugly white women. They rarely hire white males. I am glad to see them fall. Hoo-boy! I bet they’ll be shooting one-another now.
Report Post »BuddyT
Posted on November 15, 2011 at 8:34pmYet another screw up by our government. It is sad to see something like the USPS in such horrible shape. Maybe it should be privatized; the competition out there like UPS and FEDEX are doing fine. I have friends who work for the USPS and they are concerned about their futures, I feel bad for them. I am sure there is no good answer.
Report Post »encinom
Posted on November 15, 2011 at 9:10pmActually, its the GOP that screwed up the Post Office, by forcing it to fully fund its pension decades into the future, now. Remove that burden imposed by the GOP and the Post Office makes a profit.
Report Post »YepImaConservative
Posted on November 15, 2011 at 10:49pmI think FedEx and UPS have been taking some business off the USPS for years (agreements between the 3) regarding certain types of shipping which both excel at like international and big box shipments and the USPS does some very rural area deliveries where they go day in, day out.
I agree with your comments BUDDYT that the USPS should be privatized. One thing that makes me ship primarily with FedEx as opposed to UPS and the USPS, is that FedEx (except for the pilots) are non-union and that appeals to me. I do still use the USPS for letters and such (you really can’t beat the price of a stamp), but for anything larger…. FedEx.
Report Post »abbygirl1994
Posted on November 15, 2011 at 8:21pmGood grief,, all it takes is charging people a yearly rate to have their mail delivered.. you pay for a box that only takes a few steps to fill, and hours and hours for a poor mail man to deliver on the streets. It makes no sense at all, but its government, what do you expect! God help us!
Report Post »HorseCrazy
Posted on November 15, 2011 at 9:48pmI disagree. I believe we need to start neing competitive, as a business owner I used thouands of dollars of direct mail marketing every year but cannot use the post office to mail anything since they never ever went to an actual tracking system that functions or easy to fill out forms quick service etc such as ups or fedex. I can ups all of my Christmas gifts in 15 minutes, I go to the post office to mail care package to the troops and wait 50 minutes in line and fill out ridiculous forms that are nonsense. why would I weigh my packages am I not paying them to do this? I quit my direct mailing too as well as several other business like mine did in my local small business group. 2010 was the last year we used direct mail for my small business, I was spending upwards of $2500/month on it and the folks at the post office were such a pain for my assistant I just quit doing it. There is no excuse for them to have as many employees as they do and NO effective tracking system. Should have been updated 10years ago but ofcourse with a union that would be counterproductive for the unionized workers so they would never have advocated this which is the main reason they are in this mess in the first place.
Report Post »EMM1969
Posted on November 15, 2011 at 7:58pmI love reading the responses from arrogant, ill informed, dingbats. First off, the evil union workers are not paid by tax dollars. They ate paid by the cheapest postage in the world. Over 60% of labor costs are management labor dollars. Mail volume is up dramatically this year and volume follows the economy. Volume was at an all-time high till GW began dismantling the economy. The 60 billion in over paid pension fund is for employees NOT hired yet. Yes, future employees. The government will not refund the money because they use the fund to show as their own on the balance sheet, refunding it would show as the deficit being worse. Their pensions are NOT wonderful. They used to be, not now. They have a type of 401 system the employees fund 95% themselves. Lazy…try walking 16 miles a day in rain, sleet, snow, and heat. What else do they do besides deliver your mail? Help the child locked out of his house because mom and dad aren’t home yet, check on grandpap who had a heart attack getting out of his car, help the woman who just got injured in a car wreck, stop the 2 bullies from beating up the neighbor who was cutting grass, brought back your childs lost puppy that was wandering down the street, and as of 2009 under executive order they deliver needed meds in case of biological attack.
Report Post »antiencenom
Posted on November 15, 2011 at 8:33pmI us the USPS very very little,I won’t support this travesty.
Report Post »I even quit buying from companies that us them.
Tea Party forward March
antiencenom
Posted on November 15, 2011 at 8:42pmThey also give the dog something to play with Bwewaahhhahhahhahahah
Report Post »SenorStrange
Posted on November 15, 2011 at 8:54pmWhat a load of postal propaganda BS. The USPS is the poster child of government failure.
Report Post »encinom
Posted on November 15, 2011 at 9:12pmSenorStrange
Posted on November 15, 2011 at 8:54pm
What a load of postal propaganda BS. The USPS is the poster child of government failure.
__________________________
Based on what facts, you were presented with facts and your response is….
The Postal Service works when the GOP does not play politics with it.
Report Post »cassandra
Posted on November 15, 2011 at 7:41pmdoesn‘t this remind you of the teachers union where they can’t fire a bad teacher instead they go to what is called rubber rooms and do nothing all day and bring home over a hundred grand a year, yep that shows you how UNIONS don’t work
Report Post »progressiveslayer
Posted on November 15, 2011 at 7:39pmIf you put the federal government in charge of the Sahara Desert, in 5 years there’d be a shortage of sand.
Report Post »Milton Friedman
Pat Alexander
Posted on November 15, 2011 at 7:37pmThis is so easily fixed.
Raise the price of a first class stamp to a more realistic level. 75-80 cents ought to do it. What can you get for 44 cents these days? (Raising postal rates is the only thing the spendthrifts in Washington ever get a attack of frugality on.) These penny increases are not getting it done.
Raise the prices on junk mail. If the advertisers want to fill your mailbox and the mailman’s bag with junk, let them pay.
Those that say “close it down”, would sing a different tune – if they had to pay FedEx or UPS $3-$4 to mail a letter. And they won’t come to your house to get it..
And no I don’t work for the PO or the government. I operate a small business that grosses abut $30,000 a year.
But I’m smart enough to recognize a good deal. People either don’t have much sense, or haven’t thought this thru.
Report Post »SenorStrange
Posted on November 15, 2011 at 9:00pmYeah , that’s the problem, people just aren’t taxed enough. There is no waste here. pay no attention to the poor customer service and waste. I think they fuel there trucks with tax dollars.
Report Post »cassandra
Posted on November 15, 2011 at 7:27pmgovernment and unions couldn’t run a lemonaid stand
Report Post »Shasta
Posted on November 15, 2011 at 7:56pmYeah, but government and unions know how to line their pockets with our money. See the article about congress and insider trading (Pelosi for one)
Report Post »Kinnison
Posted on November 15, 2011 at 7:12pmI have a friend who just retired from the USPS in Portland, OR. Even he criticized the Post Office’s poor management and waste. He told me that the San Diego PO reorganized their operation more than three years ago but union rules prevented them from firing or retiring some 30 Postal carriers, so since the reorganization they have been reporting for work every day and simply sitting in a room with nothing to do, drawing pay and benefits. Meanwhile in Portland, where my friend worked, they were short-handed and not allowed to hire replacements for losses but also not allowed to transfer any of the San Diego people up to Portland to fill the vacancies, so the short-handed Portland Postal employees have been working and being paid for massive weekly overtime t time-and-a-half or double-time pay. Any private business run like this would long ago have been forced to close their doors, but the poor benighted taxpayers are still forced to bail the USPS out on a regular basis. It is shameful.
Report Post »LBurton
Posted on November 15, 2011 at 6:59pmTell all the pension holders that they get half or they get nothing when the privatized Postal Service goes belly up.
Report Post »brntout
Posted on November 15, 2011 at 6:56pmWelcome to the jungle.Now bite the bullet you union ignoramus’s and get ready to join the ranks of the unemployed.
Report Post »MrMagoo
Posted on November 15, 2011 at 6:53pm2011…..Scroll down,see Part 1,financial statements.This is just for 3 months(1quarter)!!!And unaudited at that.Its no wonder they are broke.With these simple figures,it doesn’t take a genius to figure out whats the problem.
http://about.usps.com/who-we-are/financials/financial-conditions-results-reports/fy2011-q3.pdf
Employee expenses is killing the USPS.
Report Post »tommee
Posted on November 15, 2011 at 6:48pmBlaze contributors: For your information… Congress in 2006, forced the U.S. Postal Service to fund 75 years of pension liabilities in 10 years – something no other private company comes close to matching. The 5.5 billion shortfall of the USPS is a direct result of the government’s attack on a very successful U.S. Mail Service, which by the way are subcontracted by UPS and FedEx to deliver their parcels to places that are not profitable. The U.S. postal service is a model company that private business can not compete with, hence the constant attacks.
Report Post »MrKnowItAll
Posted on November 15, 2011 at 6:45pmReally? How many of us have known and also read story after story of postal employees gone wild. Stealing Rebate checks, storing tons of mail because they don’t want to deliver it, so many things I could go on and on. BUT the Key is no one ever get’s FIRED!
Report Post »MIlitary Nurse
Posted on November 15, 2011 at 6:34pmYet, we need to cut from our National Defense instead of cutting off the dead, necrotic tissue that IS the Postal System!?
Report Post »kaydeebeau
Posted on November 15, 2011 at 6:45pmI think the USPS biggest fear is they will shut down and no one will even notice….. ;)
Report Post »Psychosis
Posted on November 15, 2011 at 6:31pmthe lame posters on the huff and puff swear up and down the post office isnt losing money lol
math isnt a liberals strong suit thats for sure
Report Post »Fight for America
Posted on November 15, 2011 at 6:22pmYears ago private employers cut back on middle management and used technology to make thinks more efficient.
I’ve never heard of any hits to the postal service as far as staff is concerned – until recently. The USPS is not the only game in town anymore. It has competition. It also doesn’t seem to have taken into consideration the communication done via the Internet instead of snail mail. The same with the Fax entering the playing field. Whoever ran the show really blew it.
Report Post »Baddoggy
Posted on November 15, 2011 at 6:14pmSing it!! “Look for the UNION label…”"
Report Post »Get the Government out of mail delicery and lets see how good it will get and how much money it will make.
Government employees SUCK!
progressiveslayer
Posted on November 15, 2011 at 6:12pmIt’s going down the tubes just like the country,cut it lose and about 60% of the federal government as well and we might have half a chance to save the republic.That’s not going to happen though,the intellectual titans in congress and our Marxist president will bail it out with more borrowed money,they’re clueless while Rome is burning.
Report Post »KickinBack
Posted on November 15, 2011 at 6:11pmAn ad in my local paper the other day…”US Postal jobs. $14 – $26/hour….”
That’s our government.
Report Post »PoliticalJunkieToo
Posted on November 15, 2011 at 6:10pmAnswer: PRIVATIZE the post office completely. Cut it loose from taxpayer strings. Let it sink or swim on its own.
People can send a fax though the internet now or use a company for $2 who will do it for me though the internet.
People can use email to communicate, take a picture of their check and deposit it into their account, pay their bills using FREE on-line bill pay though their credit union or bank or arrange to have their electric bill, insurance, etc companies automatically take it from their account.
There is ZERO reason to keep the post office under the government. And, if we quasi privatize it, we will have a GM/Fannie/Freddie/Big Bank situation where the companies/ AND unions privatize the profits and socialize the loses AND STILL GIVE THEMSELVES bonuses (executives AND union workers)
Report Post »MrMagoo
Posted on November 15, 2011 at 6:32pmPoliticalJunkieToo
Posted on November 15, 2011 at 6:10pm
“Answer: PRIVATIZE the post office completely. Cut it loose from taxpayer strings. Let it sink or swim on its own.”
I agree.80% of their costs are employee benefits.Pensions(instead of 401k’s like many of us working stiffs have).,no layoff clauses,10 paid holidays a year, and even 13 sick days a year.
http://www.postalemployeenetwork.com/usps-benefits-info.htm#BENEFITS%20SUMMARY
Regardless,they still are a quality group of people,in my opinion.
Report Post »MrMagoo
Posted on November 15, 2011 at 6:03pmWell,I sell on eBay occasionally and use USPS exclusively unless its a large/heavy item.They definitely have $$$$$$ problems but their service and dependability is 1st Class.With over 700 items shipped through them through the last few years,only ONCE was a package lost,and the insurance I purchased handled it quickly with a refund.I’ve never gotten a negative feedback on Ebay,thanks in part to USPS dependability. The employees and carriers have always been courteous and helpful in my dealings with them.
Report Post »I wish them all the best in getting their finances in order.How they do it isn’t gonna be easy or without pain.But its either make drastic cuts or fold.I’d really miss the USPS.
PoliticalJunkieToo
Posted on November 15, 2011 at 6:10pmThe cost is SUBSIDIZED by all taxpayers. Ditch the post office.
Report Post »smokeysmoke
Posted on November 15, 2011 at 6:12pmMABEY IS YOU STOPPED ADVERTISING SAYING THAT CONGRESS IS STEALING MONEY FROM YOU…. and actually cut your work force like any normal employeer would have to do
Report Post »Structure21
Posted on November 15, 2011 at 6:02pmWay to go federal government on showing the rest of us how to run a business!!!!
Report Post »AJAYW
Posted on November 15, 2011 at 5:54pmI say cut mail service to 3 days a week-
Report Post »PoliticalJunkieToo
Posted on November 15, 2011 at 6:11pmI say SELL IT to an AMERICAN COMPANY (not a foreign one).
Report Post »