Posted by 
From NALC
8.12.2011
The ‘Big Lie’ about postal ‘bankruptcy’
Yesterday, in a mandatory stand-up talk, Postal Service management all across the country told letter carriers:
“If we were a private company, we would have already filed for bankruptcy and gone through restructuring—much like major automakers did two years ago.”
The Service repeated this claim in a press release distributed to the nation’s news media as well.
Of course, it’s not true. But the USPS seems to think that if it repeats this “Big Lie” often enough, most people—and especially members of Congress—will think it’s true.
So, let’s set the record straight: If the Postal Service were a private company, it would not have to file for bankruptcy because it would not be subject to a USPS-specific congressional mandate to pre-fund future retiree health benefits. As it is, it is the only federal agency required to do so: It must pre-fund these benefits some 75 years into the future on a massively accelerated schedule.
This postal-only mandate, which costs the USPS $5.5 billion per year, accounts for 100 percent of the Postal Service’s $20 billion in losses over the past four years. It also accounts for 100 percent of the rise in the Postal Service’s debt in recent years. Without the mandate, the USPS would have been profitable over the past four years and it would have significant borrowing authority to ride out the bad economy. It would not have had to file for bankruptcy.
In fact, no private company in America is required to pre-fund future retiree health benefits, either by law or private-sector accounting standards. The $47 billion the Postal Service has deposited into its retiree health fund over the past four years would have been available for operating costs. And those companies that voluntarily do pre-fund would never have adopted a crushing schedule to pre-fund 80 percent of future retiree health costs in just 10 years. Nor would they mindlessly stick to such an onerous schedule in the middle of the worst recession in 80 years.
Congress, aided and abetted by the Office of Personnel Management and the General Accountability Office, mandated the destructive pre-funding policy in 2006. The common-sense solution is obvious: Let the Postal Service use the massive surpluses in its pension plans, found by two independent audits, to cover the cost of pre-funding. Indeed, 181 members of the House—from both parties—have co-sponsored legislation to adopt this solution (H.R. 1351). But thanks to the dysfunctional nature of Congress, the bureaucratic blindness of OPM and the Office of Management and Budget, and the single-minded stubbornness of the Congressional Budget Office, which “scores” any change in the pre-funding provisions as increasing the deficit even though no taxpayer funds are involved, the Postal Service now faces a financial crisis in September when the next $5.5 billion payment is due.
Don’t believe the “Big Lie.” The Postal Service is not going bankrupt. Rather, Washington politics is killing it.
Good idea….let’s treat it like Social Security. That’s obviously working out well for the country, let’s try it here too. How about this? Disband the USPS and let the private sector take care of it more efficiently and effectively.
Sadly, the provision for prefunding our healthcare liability was in the Postal Reorganization bill. My union (NALC) not only lobbied for this bill but hailed it as the savior of the postal service. If I remember correctly the prefunding was actually the brainstorm of NALC. On the last matter be mistaken, but If you read the complete reorg bill under healthcare, it clearly lays out the frefunding payments year to year through 2016
Matt,
The government is already treating us like social security. That’s the problem. They’re holding $60 to $80 billion in USPS money hostage that they had no business laying their hands on to begin with.
As for the ‘private sector’, UPS and FedEx don’t have the fleet or manpower necessary for universal delivery; nor do they have the infrastructure or network capability to process the sheer amount (we do in a day what they do in a year) of 1st, periodical and business class mailings we routinely handle with award winning customer satisfaction and efficiency.
We’re as big as WalMart and Microsoft combined. That’s after a 25% reduction in staffing over the last decade. Manpower reductions have far outpaced the decline in mail volume. We dwarf FedEx and UPS. What you propose is akin to asking one man to do the work of a backhoe with a shovel.
jeff,
You may be thinking of this, “It would also repeal the Postal Service’s obligation to make a $3 billion per year contribution to an escrow account while reversing the unfair allocation of military pension costs to the USPS.” Yes, NALC was a huge proponent of the 2006 Postal Accountability and Enhancement Act.
thank the great Bush for most of this mess
Don’t let the USPS be destroyed. Sign the petition at
http://www.change.org/petitions/dont-let-the-usps-be-destroyed
If USPS were private, they would raise prices to cover expenses, stop giving discounts that exceed costs avoided.
If private, it would could decide not deliver to Alaska or Wyoming, or to 3500 isolated small towns: provide no service except to Hoover up wealth for the owners.
It’s a public service. A service for the public, not for the big mailers.
Stop the destruction.
Tom – PEN and Rick Owens started just such a petition way back in 2002. Here it is:
http://www.petitiononline.com/1usps1/petition.html
postal — So was the petition ever sent? What happened? For the Change.org petition, we’re hoping in the next few months to collect at least 120,000 signatures–the same as the number of layoffs they want. We’ve collected more than 500 signatures in just a few days.
Worley -
Yes, the petition was sent. What happened? nothing – not even a response from anyone – although it is not my wish, that is exactly what I predict for your petition…no results whatsoever. I, we, wish you great luck with your petition – we also share your postal beliefs.
BTW – PEN does not post links to personal sites through our blog. Links such as the petition is an exception.
Rick Owens
PEN
Read the dam constituion to go private they would have to change the constituition which requires the states to ratify
I realize that many legal documents must be hand delivered to ALL locations on the map….using the Postal Service is invaluable and saves businesses and citizens money in the long run. Very good for a handwritten love letter and card to someone about to pass away. Emails never get that effect!
This is another greedy plot. I believe we will win!
Well thanks beit to the funding of mailboxes unlimited. The New Pony express.Founded and funded when?There is the electronic E stamp fund aswell.5.5 billion a year.WOW.Privatelize and Bankrupt??????Well I personaly Believe that will be the Day when the Sun tabloid seizes to go to print aswell.Yep We Deliver for You.
I bielieve the United States Postalservice has only LOST its grip on the Reality that there are in Fact other Currior and Delivery Companies that can more than HONESTLY out perform and pro~form the U.S.Postalservices in the #1 GOAL that Postal Management has failed in.HEY after all a Company is only as good as the people that represent it.Call the postal service with a few simple issues about the quality of service and record the conversation on a recorder.
A person can opt an experiment by going out to dine at a fine reastaraunt.This being in person face to face vs over the phone.I go dressed just like I am.A hobo,,lol,and i get better service from the STAFF at the fine restraunt than DEALING with P.O.STAFFERS.ATTITUDE spells GET what you pay for.
I went to all the HONOR our Veterans diners this past holiday.I noticed that despite attire,clothes and such,because thats the SOCIAL NORM.That no matter how people were dressed.The Staff of those places treated everybody like a million bucks.
I see FEDERAL EXPRESS and UPS as 2 organizations that not much negativity is draw towards in the aspect of Quality,Service,and Perfessionalism.Oh might I add I only worked for the Postal Service as a career Employee nine years.I was forced into an early out retirement.However I was a non carreer employee for nearly seven years prior to becoming a temp career employee .
During those years I served as the Shop Stewart and health rights coordinator.Now I am into my fifth year of retirement and studying the possibilities of a medical carreer.Something in the lines of nursing school since I am only forty years of age and healthy.