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Old 09-05-2011, 08:21 AM   #1
AshleyO
 
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USPS in a shitstorm of trouble.

http://www.nytimes.com/2011/09/05/bu...ewanted=1&_r=2

The article blames the internet and strong unions.
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Old 09-05-2011, 09:57 AM   #2
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The link isn't working for me.
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Old 09-05-2011, 01:03 PM   #3
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That makes me upset.

The link works for me. But I don't know how to fix it.
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Old 09-05-2011, 01:24 PM   #4
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The United States Postal Service has long lived on the financial edge, but it has never been as close to the precipice as it is today: the agency is so low on cash that it will not be able to make a $5.5 billion payment due this month and may have to shut down entirely this winter unless Congress takes emergency action to stabilize its finances.


Labor represents 80 percent of the agency's expenses.


Cliff Guffey, left, and Fredric Rolando preside over two of the Postal Service's largest unions.

“Our situation is extremely serious,” the postmaster general, Patrick R. Donahoe, said in an interview. “If Congress doesn’t act, we will default.”

In recent weeks, Mr. Donahoe has been pushing a series of painful cost-cutting measures to erase the agency’s deficit, which will reach $9.2 billion this fiscal year. They include eliminating Saturday mail delivery, closing up to 3,700 postal locations and laying off 120,000 workers — nearly one-fifth of the agency’s work force — despite a no-layoffs clause in the unions’ contracts.

The post office’s problems stem from one hard reality: it is being squeezed on both revenue and costs.

As any computer user knows, the Internet revolution has led to people and businesses sending far less conventional mail.

At the same time, decades of contractual promises made to unionized workers, including no-layoff clauses, are increasing the post office’s costs. Labor represents 80 percent of the agency’s expenses, compared with 53 percent at United Parcel Service and 32 percent at FedEx, its two biggest private competitors. Postal workers also receive more generous health benefits than most other federal employees.

The Senate Homeland Security and Governmental Affairs Committee will hold a hearing on the agency’s predicament on Tuesday. So far, feuding Democrats and Republicans in Congress, still smarting from the brawl over the federal debt ceiling, have failed to agree on any solutions. It doesn’t help that many of the options for saving the postal service are politically unpalatable.

“The situation is dire,” said Thomas R. Carper, the Delaware Democrat who is chairman of the Senate subcommittee that oversees the postal service. “If we do nothing, if we don’t react in a smart, appropriate way, the postal service could literally close later this year. That’s not the kind of development we need to inject into a weak, uneven economic recovery.”

Missing the $5.5 billion payment due on Sept. 30, intended to finance retirees’ future health care, won’t cause immediate disaster. But sometime early next year, the agency will run out of money to pay its employees and gas up its trucks, officials warn, forcing it to stop delivering the roughly three billion pieces of mail it handles weekly.

The causes of the crisis are well known and immensely difficult to overcome.

Mail volume has plummeted with the rise of e-mail, electronic bill-paying and a Web that makes everything from fashion catalogs to news instantly available. The system will handle an estimated 167 billion pieces of mail this fiscal year, down 22 percent from five years ago.

It’s difficult to imagine that trend reversing, and pessimistic projections suggest that volume could plunge to 118 billion pieces by 2020. The law also prevents the post office from raising postage fees faster than inflation.

Meanwhile, the agency has had a tough time cutting its costs to match the revenue drop, with a history of labor contracts offering good health and pension benefits, underused post offices, and laws that restrict its ability to make basic business decisions, like reducing the frequency of deliveries.

Congress is considering numerous emergency proposals — most notably, allowing the post office to recover billions of dollars that management says it overpaid to its employees’ pension funds. That fix would help the agency get through the short-term crisis, but would delay the day of reckoning on bigger issues.

Postal service officials say one reason for their high costs is that they are legally required to provide universal service, making deliveries to 150 million addresses nationwide each week. They add that a major factor for the post office’s $20 billion in losses over the past four years is a 2006 law requiring the postal service to pay an average of $5.5 billion annually for 10 years to finance retiree health costs for the next 75 years.

But the agency’s leaders acknowledge that they must find a way to increase revenue, something that will prove far harder than simply slicing costs.
Look it up in NY Times
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Old 09-05-2011, 01:26 PM   #5
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In some countries, post offices double as banks or sell insurance or cellphones. In the United States, the postal service is barred from entering many areas. Still, the agency is considering ideas, like gaining the right to deliver wine and beer, allowing commercial advertisements on postal trucks and in post offices, doing more “last-mile” deliveries for FedEx and U.P.S. and offering special hand-delivery services for correspondence and transactions for which e-mail is not considered secure enough.


Mr. Donahoe’s hope is to cut $20 billion of the $75 billion in annual costs by 2015. To do that, he wants to close many post offices and slash the number of sorting facilities to 200 from 500 and trim the agency’s work force by 220,000 people, from its current 653,000. (A decade ago, the agency employed nearly 900,000.)

The postal service has the legal authority to close facilities, although community opposition can make the process difficult. To placate critics and cut costs, officials say they would seek to run some postal operations out of stores like Wal-Mart or to share space with other government offices.

Cutting the work force is more difficult. The agency’s labor contracts have long guaranteed no layoffs to the vast majority of its workers, and management agreed to a new no layoff-clause in a major union contract last May.

But now, faced with what postal officials call “the equivalent of Chapter 11 bankruptcy,” the agency is asking Congress to enact legislation that would overturn the job protections and let it lay off 120,000 workers in addition to trimming 100,000 jobs through attrition.

The postal service is also asking Congress for permission to end Saturday delivery.

Given the vast range of stakeholders, getting consensus on a rescue plan will be difficult.

Senator Susan Collins of Maine, like many lawmakers from rural states, vigorously opposes ending Saturday delivery, which would trim only 2 percent from the agency’s budget. Ms. Collins, the ranking Republican on the committee overseeing the postal service, said the cutback would be tough on people in small towns who receive prescriptions and newspapers by mail.

“The postmaster general has focused on several approaches that I believe will be counterproductive,” she said. “They risk producing a death spiral where the postal service reduces service and drives away more customers.”

The post office’s powerful unions are angry and alarmed about the planned layoffs. “We’re going to fight this and we’re going to fight it hard,” said Cliff Guffey, president of the American Postal Workers Union, which represents 207,000 mail sorters and post office clerks. “It’s illegal for them to abrogate our contract.”

Senators Carper and Collins do back several of the postal service’s main ideas to avoid default, including recovering around $60 billion that some actuaries say the agency has overpaid into two pension funds. Although the Obama administration is working closely with the senators to find a solution, it has signaled discomfort with the pension proposals, questioning whether the postal service really overpaid.

Meanwhile, Representative Darrell Issa, the California Republican who is chairman of the House Oversight Committee, says the pension proposals would amount to an unjustifiable bailout that would not solve the agency’s underlying problems. He is pushing a bill that would create an emergency oversight board that could order huge cost-cutting and void the postal service’s contracts — a proposal that not just the unions, but Senators Carper and Collins oppose.

Fredric V. Rolando, president of the National Association of Letter Carriers, warned of disaster if partisanship keeps Congress from acting.

“This is about one of America’s oldest institutions,” he said. “It survived the telegraph, it survived the telephone, and we have to do everything we can to preserve it and adapt.”
I'm posting it here so those that can't see the link can read it.
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Old 09-05-2011, 01:44 PM   #6
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The link works fine for me.

I honestly don't know what to think of this, it does seem like a lot of fat needs to be trimmed but that they don't have the options that a lot of businesses would use like cutting benefits or raising prices (this one especially as they are typically much cheaper than their competition) and they really need to reexamine how they function to take the use of email instead of snail mail to send the majority of letters, but at the same time they really can't afford to reduce services as the main reason (at least in my observations) that people choose UPS or FedEx is because they are so much more convenient and frequently faster and they owe it to their workers to abide by the agreements that they made.
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Old 09-05-2011, 05:27 PM   #7
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Government workers should suffer no less than the taxpayers who support them. If the GNP rate contracts, government should contract. As a taxpayer I have no problem paying taxes to support the disadvantaged, but paying to support a $90,000 US annual retirement pension for a city or county employee has our priorities screwed up.

The county where I live is trying to push through pension reform but the unions are protesting loudly here too. Unions that protect workers from abuse by private employers is one thing, but unions that work for the government? That makes them doubly protected, when some of us private citizens have no safety net at all.
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Old 09-05-2011, 06:05 PM   #8
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"US Post Office in danger of closing! Please e-mail, text or fax Congress and urge them to keep this vital service!" -- Frank Conniff

"Can't I just tweet @Congress with a #saveusps hashtag?" -- Ed Dravecky

.
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Old 09-06-2011, 12:14 AM   #9
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In Ireland the post office is so much more than a post office. They are also a bank and offer mobile phone services. You can pay all of your bills there and anyone getting any type of government assistance goes there once a week in person to collect their money. You also can mail stuff from there, but sure, you rarely run into people there actually sending any mail.

The US postal service needs to cop on and get with the times. In Ireland and the UK there is no postal service on the weekends. Cutting two days off right there will save billions. They also don't do home pickup. We have boxes much like ye do in America located in all major town centres that people can drop letters in. Another thing is in Ireland 90% of all mail is delivered by a person on a mountain bike or on foot. There are very, very few vans. The vans only operate in very remote places.

Finally, the government should implement strict laws on postage there like they have here. In America the amount of junkmail that is sent is staggering. In Ireland companies can send junkmail, BUT we have a national 'do not send junkmail' list like the 'do not ring' list for telemarketers. If you are on the list and get junkmail you can sue the company for like €10,000. On top of this there are no special postage rates. All mail costs €.98. Thats about $1.30. If companies choose to send out junkmail, they pay the same rate as everyone else.

America uses the junkmail industry to prop up the USPS. The reality is much like the record companies their business plan is outdated and the powers that be at the top are too blind or too entrenched in their old ways to change it. Stopping junkmail is the green alternative, but would impact revenue. That being said companies that do go through with mass campaigns will pay. More importantly the less mail you have, the less carriers you need and the less vans you need. A guy on foot with a small shoulder sack is a lot cheaper to subsidize than a fleet of vans.
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Old 09-06-2011, 10:56 AM   #10
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Thank you for posting those, Ashley. I will give a proper response to this later, but right now I'm going to say that Sternn's idea sounds like a good one.
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Old 09-10-2011, 09:34 AM   #11
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Okay, I'm trying to figure out what, besides nostalgia, is the reason for clinging to the current postal system? If they need money why not let them make it? We had all of this money to bail out companies a couple of years ago, but none to save the post office? Why can't the government save he jobs of regular people when they could bail out the rich?

All I have is questions...
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Old 09-10-2011, 12:07 PM   #12
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I think the best thing to do is to allow them to evolve.

That'd be much better than throwing their unions under the bus because it's most convenient for a lesser amount of people.
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Old 09-10-2011, 01:28 PM   #13
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I think it's sad, but we have become slaves to the typed word. I wonder if they're counting the letters and care packages sent to our troops in the Middle East?
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Old 09-11-2011, 08:40 AM   #14
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I wonder who thought selling "forever stamps" (whereby a person can buy up stamps at today's rate and use them any time in the future no matter what the actual cost of delivering the package is) was a good idea?
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