Rain, sleet, and snow may not stop the U.S. Postal Service from making deliveries. But bankruptcy just might.
Stories about the dire state of the Postal Service are so common that one could be forgiven for wanting to turn the page wondering, what else is new? The reasons behind the agency’s dire financial straits are well-known: E-mails have almost universally replaced letters, it is strapped with huge labor costs, and it is forced to make deliveries to every corner of the country, to name a few challenges. But now the situation is so dire that the postmaster general is practically waving his hands in the air, warning about a doomsday scenario from the front page of the New York Times.
“Our situation is extremely serious,” the postmaster general, Patrick R. Donahoe, said. “If Congress doesn’t act, we will default.” On Thursday Republican Rep. Darrell Issa launched SavingthePostalService.com to detail the problems facing the agency and literally count down to the agency’s default.
Indeed, the Postal Service “may have to shut down entirely this winter unless congress takes emergency action to stabilize its finances,” writes the Times. The agency is so low on cash it might not be able to make a $5.5 billion payment this month to finance retirees’ health care plans. But that’s hardly the worst of it. Unless something is done, the USPS will not have enough money to pay labor costs early next year, forcing the agency that employs more than half a million America to simply grind to a halt.
Now Congress is considering a number of proposals that could help the agency get over its current problems, but they would mostly “delay the day of reckoning on bigger issues.” Simply put, the Postal service needs to increase revenue, “something that will prove far harder than simply slicing costs,” notes theTimes. The Senate Homeland Security and Governmental Affairs Committee will hold a hearing on Tuesday to hear from Donahoe as well as union leaders to get suggestions on how the Postal Service could be rescued, but many are worried the partisanship that is running rampant in Washington could prevent lawmakers from acting.