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Hinky budget system is jeopardizing USPS | As It Turns Out

When was the last time you were in the post office? Did you know the U.S. Postal Service has served us — no matter what burg or lonely rural area we live in — since 1775? It’s even older than the Constitution.

In 1970, the USPS was modified from a Cabinet-level department to a privately-funded public mail delivery service. Congress basically managed it after that, but the Postal Service funded itself, relying entirely on the sale of stamps and postage. No taxpayer dollars have been used since then. As with every other area in our lives, politics rears its ugly head in the post office.

Much attention is made in the media about allowing no “bailouts” for the Postal Service. It’s funny how we sometimes just believe the media and the politicians without doing any homework. I did until I finally started asking questions.

Reasons abound over why the USPS is so horribly in debt and needs the help of Congress. The recession is always an easy one; who isn’t affected by that? Think about the price of gas alone.  “Electronic divergence” to email and the Internet is another one. This has done its damage, but isn’t the real reason, either.

And there’s the favorite for union busters — wages and benefits are too high, way out of control. Postal workers’ wages and benefits are “good,” not “out of line.”

The painfully obvious reason appears to be that, for the last five years, the Postal Service has made a $5.5 billion payment each Sept. 30.

This particular story begins with the 2006 “Post Accountability and Enhancement Act,” mandating that the USPS fully pre-pay 75 years of future retiree health benefits within the next 10 years. Yes, that means funding health benefits for retirees not even born yet.

Sound a bit hinky? It should. No other government entity shares this same requirement. In addition, the law was enacted the same year the USPS experienced its biggest volume of mail ever, and so was at its most prosperous.

It gets stranger yet.

“The Postal Service is not included in the federal budget, but the Treasury Department account that receives that payment is. That means that when the post office deposits that money, it counts as income in the federal budget. So, if it doesn’t make the payment, the federal budget deficit appears $5.5 billion bigger,” says AP’s Randolph Schmid. “The $5.5 billion payments [may be characterized] as a post office bailout of the federal budget because it makes the deficit appear smaller.”

Is there room for more lunacy? Audits initiated by the Inspector General and the Postal Regulatory Commission show overpayments of pension benefits of at least $50 billion into the Civil Service Retirement System.

H.R. 1351, the United States Postal Service Pension Obligation Recalculation and Restoration Act of 2011, is a bill co-sponsored by Rep. Jay Inslee, D-Poulsbo. It calls for a definitive audit to determine the exact amount of the overpayment and then to have that amount transferred to satisfy the retiree health plan pre-fund requirement. This legislation would also repeal this pre-fund requirement if passed.

The Postmaster General has been requesting help from Congress, including such short-term fixes as a 90-day grace period, five-day mail delivery, allowing sales of additional merchandise — and cutting loose 220,000 postal jobs, 3700 post offices and 300 mail processing plants nationwide. Even more draconian “fixes” yet include increasing competition to end the “USPS monopoly” on mailbox delivery and taking complete congressional control over the Postal Service.

Who are the real losers in all this?

U.S. post offices have served as the true heart of many communities, particularly small burgs and rural America. That will be where the lost jobs and facilities will be, not the urban areas.

Although Congress requires the Postal Service to provide universal service at a fixed rate, FedEx and UPS charge extra for thousands of rural zip codes.

Think about it next time you gripe about the price of a stamp. What else can you get for 44 cents these days?

 

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