The U.S. Postal Service Nears Collapse

Businessweek ^ | May 26, 2011 | Devin Leonard

[4buttons]

He is struck by how many USPS executives started out as letter carriers or clerks. He finds them so consumed with delivering mail that they have been slow to grasp how swiftly the service's financial condition is deteriorating. "We said, 'What's your 10-year plan?' " Herr recalls. "They didn't have one."

[driftdiver]

My church is fine but thanks for jumping to that conclusion.

[Clintonfatigued]

There seems to be a lot of that going around.

[muawiyah]

Interesting article ~ been there, done that, plan rejected by management because Congress would have crucified them.

My plan, done for Postmaster General William F. Bolger would have done two things:

(1) Close about 25,000 post offices and other facilities devoted to servicing less than 10% of the nation's mail needs, and

(2) Reorganized rural delivery ~ which wouldn't have cost any rural carriers a job, but would have allowed those 25,000 post offices to be closed.

The savings over 30 years ago were a MINIMUM of $800,000,000 per annum ~ that's about $10 billion per year now.

I still have a copy.

This Herr guy is remarkably timid. Apparently the former letter carriers got to him. He should have called me first.

[muawiyah]

Mail volume, in the aggregate, is down 17% from what it was 3 years back.

[Mariner]

The USPS should be sold/licensed for whatever the market will pay for it.

The sole requirement being that they must deliver and pick up first class mail from every address in the USA 4 times per week.

[muawiyah]

Hmm ~ did you actually talk to an inspector about the lost parcels or just to name your suspects?

[who knows what evil?]

I’ve had at least six packages stolen in the past few years.

I had one 'disappear' this weekend...point 'A' to point 'B' via 'PRIORITY' mail, and they lose it...

[driftdiver]

UPS does that to me here. Sent overnight and it took 4 weeks. Of course there was no refund.

Since big brown unionized I’ve found them to be a lot less efficient and more expensive.

[who knows what evil?]

I have also heard from a certain well placed person that the main post office in Greenville SC is a major point for stuff (gift cards esp) disappearing only to reappear at delivery with no contents. Complaints that were filed apprently were quashed or flat out ignored. Anything of value goes UPS or Fedex.

Someone sent my wife a birthday card a few years ago that contained a 'gift card' when it was mailed...the 'gift card' disappeared somehow before it arrived.

[Greysard]

The Fedex site (I didn’t try UPS) took me to a dozen screens before showing me (and I’m still not sure that is correct) that the same letter could cost me $28.85 or more to have delivered.

It's a different level of service. USPS doesn't personally deliver your letter to a foreign location. They only sort the letters, load them into bags and send them away. At the destination country some other postal worker will do the other half of the delivery. Note that $1 USD may be a lot of money in most 3rd world countries, so USPS will still collect most of the money for the in-country trip and perhaps the airfare.

Talking about the airfare. One ticket, round-trip, from SFO to Spain is about $1,000 (there are offers for $764 too.) A standard non-cargo airliner will carry 300 people, 200 lbs each (forget the cargo.) Total load = 60,000 lbs or 960,000 ounces. Each 44 cent letter is below 1 oz. so the airplane will carry about a million letters to Europe and back. If the flight is filled with passengers the revenue would be $300K over the entire round trip. If the flight is filled with mail, each envelope has to pay 15 cents one way to make the same profit to the airline. In reality envelopes fly much cheaper because there is no service in cargo holds, no TV, no heating, no free drinks, etc. etc. Probably an envelope can catch a flight to Europe for mere 5 cents.

Let's subtract 44 cents from 96 cents to cover the delivery from your home to the airport. We get 52 cents. We just above calculated that we need about 5 to 15 cents to fly the mail to the destination country, that leaves us with 37 to 47 cents for the local delivery. This is very much on par with the US leg of the trip.

So back to FedEx. What do they charge those $28.85 for? They charge them for speedy and reliable delivery. FedEx is what you send business documents with. FedEx will cone personally to you and pick the package up. On the other end of the trip, FedEx will send a truck to the destination location, also personally. Packages will fly not on whatever airplane, but on a FedEx airplane, and they will be under company's control all the time until they are delivered. They won't be dropped off wherever (unless you specifically permit that.) USPS doesn't know what happens to your mail abroad, and doesn't care - it's not part of the service. USPS doesn't even track domestic 1st class, you have to pay more to get the service of a barcode and a scanner.

So why the FedEx price is so high? Because they are doing personal delivery now, several times per day (about 3.) If they are allowed to operate in the USPS market space they can cover it at no extra cost whatsoever; the routes already cover most of the territory that USPS covers.

There is one small side note, though. FedEx doesn't have machines to sort small mail, and I'm unsure if they can currently ship such small items. Usually FedEx ships packages - that's all that the law allows them, so no surprise that they never invested into anything else. This can change.

[who knows what evil?]

Of course there was no refund.

That's the shame of it...the shipper will replace the lost items, AND pay for 'priority mail' AGAIN; all out of HIS pocket. It should come out of United States Pilfering Service's hide, not the shipper. He didn't do anything wrong...

[meatloaf]

How hard would it be to get those exploding die packs that banks use to identfy robbers? If they’re stealing stuff that regularly, it might be fun to set them up.

[catfish1957]

No way My stamps say forever on them. /s

[dr_lew]

Who's heard this song ? Strange sentiments from ones so young, but I find it eerily nostalgic even though I was never much of a letter writer myself.

[proudpapa]

The saving grace for USPS is that they own a lot of prime real estate.

They need to close/consolidate a lot of their locations. And start delivering mail 2x’s a week.

[Graneros]

Change that to FedEx. UPS is union FedEx is not.

[pacpam]

What you require as a commitment will never happen. FedEx and UPS finish a number of their deliveries via the USPS in areas that are ‘too’ expensive to serve.
USPS has univeral rate that totally funds salaries, retirement, health ins., buildings, equipment, etc., from postal sales. Only thing directly funded by Congress is services for the blind. USPS has overpaid to OPM over $85,000,000,000 for future retirees. This fact is recognized but gov’t still wants to collect again this year from USPS.
USPS is hamstrung by Congress and Postal Commission in it’s quest to remain competitive. Unions are a bane to the USPS but they came about because of woeful abuse of power and abuse of the workforce, prior to strike during Nixon’s Presidency. Not perfect or even close but not funded by taxpayer dollars as many claim. Main complaint is laziness on part of management to do the job for which they were hired. But then the USPS does promote from within and seldom is anyone held accountable.

[redangus]

Worked for USPS as consultant back in the late 90’s and saw this coming. The USPS is one of the worse run organizations in history. The unions own them, the people who own the buildings they lease take them to the cleaner daily and the management from the local PM to the district/regional/national level are unimaginative, hide-bound and blind to everything wrong with organization. It was a true eye opening experience for me as to just how poorly government works. But in their defense watching a letter enter a facility at 6pm and see it delivered 200 miles away by 3pm the next day was amazing.

[notpoliticallycorewrecked]

BTW any negative comments here on FR usually elicits some irate but amusing private freepmail from USPS workers.

You too? I was sent a profanity lace FRmail berating me. It was so professional of him. /s I didn't waste my time with a reply since I refused to lower myself by aruging with a idiot.

[joelt]

Both Fedex and UPS have had agreements with certain “mail order” retailers (LL Bean?) whereby the carrier will transport from the shipper to the local PO which carrys it the “last mile.” These have been experiments in my view. Fedex does not use USPS to mail to anyone aside from these special contracts. They will use contractors to BFE locations in crazy remote areas of the West and AK...... Neither UPS or FEDEX were close to going under. Fedex never came close to asking for a bailout. I’m a 25 year Fedex employee.