Our USPS has its share of problems. First, they’re a government agency at heart, function as such, hire as such, pay as such and operate with a skewed reality that the private sector does not. Secondly, as a quasi-government agency, they face real, relentless competition, which is something bureaucratic agencies aren’t equipped for but for one which they’ve successfully engaged and adapted, IMHO. However, you can’t deny they’ve done an impressive job with the sheer volume of mail and still manage to deliver with predictable reliability, 90% of the time. Thirdly and most importantly, here is why the USPS is imploding:
(From Time Mag, Feb 2013, How Healthcare Expenses Cost Us Saturday Postal Delivery by Josh Sanburn)
Since 2006, the Post Office has been legally required to pre-fund health benefits for future retirees at a cost of around $5.5 billion a year. For the first time last year, it defaulted on its annual payment.
When Congress imposed those mandates in 2006, the Post Office was doing just fine. Digital communication had yet to take such a huge bite out of the amount of mail the USPS processed and delivered. First-class mail volume was about 97 billion pieces in 2006. So there wasn’t much of a backlash when Congress decided that the Post Office was healthy enough to lock in health benefits for future retirees — for the next 75 years, mind you, something no other public or private agency does.
Two years later, the U.S. was hit by the Great Recession at around the same time that mobile communication and things like online bill payments were growing at explosive rates. The Post Office began reporting massive deficits from which it has yet to recover. Last year it delivered only 68 billion pieces of mail.
They have a union problem. Colossal inefficiencies compounded with inept leadership.