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USPS posts $3.5 billion loss as mail volume plunges
CNN ^ | August 5, 2010 | Hibah Yousuf

Posted on 08/05/2010 9:41:55 AM PDT by Zakeet

The U.S. Postal Service reported a $3.5 billion loss in its most recent quarter Thursday, as mail volume plummets and retiree health care costs mount.

The USPS, a self-supporting government agency that receives no tax dollars, said operating revenue declined 1.8% to $16 billion during the fiscal 2010 third quarter compared to a year earlier, while operating expenses spiked 4.2% to $19.5 billion.

The quarterly loss was the fourteenth in the last sixteen quarters, the postal service said.

"A significant portion of USPS losses in the past few years has been due to an unprecedented decline in mail volume -- down more than 20% since 2007," the USPS said in a statement. "The replacement of letter mail and business-transaction mail by electronic alternatives continues to cause downward pressure on mail volume."

"Securing the fiscal stability of the Postal Service will require continued efforts in all of these areas, as well as further review of retiree health benefit prefunding," said postmaster general John Potter.

"It also will require that the Postal Service gain flexibility within the law to move toward five-day delivery, to adjust our network as needed, to develop new products the market demands, and to work with our unions to meet the challenges ahead," he added.

(Excerpt) Read more at money.cnn.com ...


TOPICS: Business/Economy; Front Page News; Government; News/Current Events
KEYWORDS: economy; losses; postal; postoffice; usps
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To: muawiyah
$75 billion means the USPS did not negotiate in good faith with the unions...

I thought that the $75 billion excess came from mandatory calculation methods imposed upon them by regulators and Congress, as opposed to any kind of duplicity or bad faith on their part.

41 posted on 08/05/2010 10:27:03 AM PDT by mvpel (Michael Pelletier)
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To: muawiyah

First, I understand that you are a Postal Service retiree, so don’t get all defensive. My question is sincere. If the postal service is not taxpayer funded, how can they continue to operate losing billions each quarter for 14 quarters straight? They should have gone belly up years ago. Do they have some sort of slush fund they are operating out of? I am just trying to understand.


42 posted on 08/05/2010 10:29:35 AM PDT by John.Galt2012 (I'll take Liberty and you can keep the "Change"!)
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To: muawiyah

“They could probably cut the loss to near zero simply by eliminating curbside (and certainly “door”) delivery and require folks to get their mail at community cluster boxes”

That’s what occurs in our community especially with any new development. Works well and Pete gets 500 houses’ mail delivered in less than 45 min. They had talked about discontinuing rural deliveries in our area and having those customers use PO boxes, but I’m not sure what came of it. Saturday delivery is convenient to the customer, but it is not vital. I do like first class and priority mail, it is substantially cheaper than fed ex or ups. There is a lot the USPS should stop doing for “free” for its customers. I would love to see the USPS have a system similar to “no call” for the ridiculous amount of bulk and solicitation mail I receive. I asked at the local po and they said nothing they can do. I would also be willing to pay a fee for deliver of my mail similar to the price of a po box rate


43 posted on 08/05/2010 10:30:14 AM PDT by ebersole
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To: kitkat

I had a very recent incident where the USPS took a parcel post package, opened it during transit, stole the contents and replaced them with an AA book, then resealed the envelope with tape and delivered it to the addressee as if nothing was amiss. The USPS doesn’t even care to investigate the theft ... union protections don’tchaknow! NEVER send anything bigger than a letter via the USPS thieves.


44 posted on 08/05/2010 10:30:37 AM PDT by MHGinTN (Dem voters, believing they cannot be deceived, it is impossible to convince them when deceived.)
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To: mvpel
No, it's bad faith. Exclusive of the retirement system where the OPM is dictating benefits, you have a total estimated cost package that's presented by the USPS to the unions as "here it is guys".

If they are letting money be sucked off the top by the retirement system that has an impact on the amount of variable costs which are going to be looked at to estimate relative pay levels for different crafts and a host of specialty occupations.

USPS owes it, as a good faith matter, to LOOK AT WHERE IT'S SPENDING THE MONEY and to make sure that it is being spent correctly.

This is like the THIRD TIME USPS has been caught (in terms of billions of dollars) failing to watch what it pays OPM!

Maybe the first time it was a surprise, but the second time? And now, a third time, and the dollar values just keep growing. It's BAD FAITH.

At some point here I think we are speaking of criminal acts on the part of Postal management and OPM retirement system analysts and managers.

45 posted on 08/05/2010 10:32:59 AM PDT by muawiyah
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To: Spktyr
An easier fix would be to allow private non-union contractors to deliver the mail instead.

Turning post offices into private franchise operations may help also. Like UPS stores.

46 posted on 08/05/2010 10:34:09 AM PDT by Wiggins
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To: Zathras

The USPS is dead. They are just being kept alive artificially with billions of taxpayer dollars.


47 posted on 08/05/2010 10:36:02 AM PDT by Republic of Texas (Socialism Always Fails)
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To: John.Galt2012
The system is they set a postage rate that is sufficient, under normal conditions, to avoid raising postage rates for 4 or 5 years. The first couple of years under a new rate structure provide a SURPLUS. That money is then spent down in later years. Once the surplus is gone they will have initiated a new postage rate increase or adjustment.

Now, about government agency losses, when is the last time you saw Department of Defense bring back the loot to pay for its existence?

48 posted on 08/05/2010 10:36:22 AM PDT by muawiyah
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To: edcoil

Apparently, Hibah Yousuf does among other CNN idiots.... =.=


49 posted on 08/05/2010 10:37:57 AM PDT by cranked
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To: muawiyah
Think of the revenue the United States Parking Service could collect from those 75 million customers. I suppose some of the displaced carriers could operate the parking ramps.
50 posted on 08/05/2010 10:38:02 AM PDT by ASA Vet (Natural-born citizens, are those born in the country, of parents who are citizens. De Vattel)
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To: Republic of Texas

And how many billions is that?


51 posted on 08/05/2010 10:38:06 AM PDT by muawiyah
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To: Zakeet

Duhhh. Keep hiking those rates and people will keep switching to paperless billing and alternative shippers.


52 posted on 08/05/2010 10:38:30 AM PDT by 668 - Neighbor of the Beast
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To: muawiyah

Read the headline. They won’t operate at a loss, so that money will come from us.


53 posted on 08/05/2010 10:41:18 AM PDT by Republic of Texas (Socialism Always Fails)
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To: muawiyah
They need to cut the service to two days a week..The only mail I get is junk mail and bills that I cannot get online
54 posted on 08/05/2010 10:41:34 AM PDT by Hojczyk
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To: Zakeet

About the only mail we get here is stuff from the govt, and other such junk mail. Then we have to pay the trash collector to take it away, too.


55 posted on 08/05/2010 10:42:36 AM PDT by 668 - Neighbor of the Beast
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To: muawiyah

Ok. That seems to make sense and provides some pricing stability and probably saves some money with fewer stamp changes...but they’ve been losing billions each year for almost 4 years and they adjusted rates in ‘01, ‘02, ‘06, ‘07, ‘08, ‘09 and now ‘11. Shouldn’t they have had a few surpluses by now, or are they playing catch up with respect to their pension and benefits?


56 posted on 08/05/2010 10:44:31 AM PDT by John.Galt2012 (I'll take Liberty and you can keep the "Change"!)
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To: Wiggins

They might even get the post offices’ PO box rental percentages up if they weren’t the only “mail centers” that wouldn’t accept packages from the major common carriers like FedEx and UPS.

The bit about FedEx is especially stupid, as Express Mail is now just a relabelled FedEx service, and a FedEx truck backs up to the post office loading dock every day to collect/deliver any Express Mail shipments.

UPS tried a similar policy with their UPS Stores briefly, where they wouldn’t accept FedEx or DHL packages but customer outcry (and the resulting box rental cancellations) made them reverse their policies. So the USPS is the only service where your rented mailbox can only get USPS shipments. Idiots.


57 posted on 08/05/2010 10:46:40 AM PDT by Spktyr (Overwhelmingly superior firepower and the willingness to use it is the only proven peace solution.)
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To: Republic of Texas
They've been operating at a loss for about half the time since the agency was set up. They've been operating at a profit for the other half.

It's a system ~ BTW, the law requires them to get rate increases sufficient to pay their costs, so they have filed for new rates already.

Let me give you a hypothetical comparison ~ you get paid weekly. So, on Friday you get your check and that day you make $1,000,000.

The rest of the week you do nothing but spend, spend, spend, and by Thursday you have NOTHING, plus a new credit card bill.

You just had 6 days of massive losses, and 1 day of profit!

That's the way they do it, but with very large numbers.

58 posted on 08/05/2010 10:47:49 AM PDT by muawiyah
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To: Zakeet
Wait until 2011 when all on line sellers will be 1099’d. Lots of small sellers are going to stop selling on line which means less shipping. Thanks Chris Dodd!
59 posted on 08/05/2010 10:48:00 AM PDT by 4yearlurker (Gus the Scotty dog likes cheese!)
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To: Spktyr
I live in downtown Oceanside CA. there is the old post office and 9 blocks away, the newer and bigger one with full service. I asked if they were going to close the old one. The employees say no talk of it. I have driven through southern West VA where towns of under 300 have a post office and down the road 4 miles is another town with a post office. Should be easy to close post offices if you can keep the congress from interferring.

I know the postal services is in the constitution, but it's time to close shop. Most people could survive with 3 days of mail a week. Make it two and have 1 carrier cover two different routes. Announce you are closing in 6 years and the companies and the employees will figure it out, as well as the customers.

60 posted on 08/05/2010 10:50:30 AM PDT by whence911 (Here illegally? Go home. Get in line!)
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