Post office may need an urgent rate increase

U.S. Postal Service is in “the midst of a financial disaster.”
TNS Regional News
Sep 20, 2013


It’s called snail mail because it’s slow compared with its electronic competitors — and electrons, unlike humans, work for free.

The U.S. Postal Service is in “the midst of a financial disaster” and may need an emergency increase in postage rates to keep operating, Postmaster General Patrick Donahoe warned Thursday.

The agency’s plight comes despite a 1-cent rate increase on first-class mail that took effect in January. A first-class stamp now costs 46 cents.

“The Postal Service as it exists today is financially unsustainable,” Donahoe told the Senate Homeland Security and Governmental Affairs Committee.

If that refrain sounds familiar, it is.

Postal officials have been complaining to Congress about the perilous state of their finances for months, noting that unless lawmakers ease the fiscal pain, a rate increase or a cut in services will be needed. The post office expects to lose $6 billion this year on top of the $16 billion it lost last year.

The Postal Service’s board of governors could decide as early as next week whether to request a special rate increase.

The independent agency’s problems have been well documented. Competitors like UPS have cut into its deliveries and the Internet has stolen away other business. Email and texting are faster and easier than sending first-class letters. Even bills — routinely delivered and paid by mail a decade ago — are often handled electronically today.

“We’ve lost 27 percent of our mail over the course of the last five to six years,” Donahoe said. “And when that happens, you have to make changes.”

Congress is considering cost-cutting moves that include an end to Saturday mail and door-to-door delivery. Postal workers oppose those changes, as do many lawmakers and some constituents.

A legal requirement that the Postal Service prepay its retiree health care costs is also draining its coffers. The agency missed two $5.6 billion payments last year and is expected to miss another one within weeks. It has asked lawmakers to relax that requirement.


By Michael Muskal - Los Angeles Times (MCT)

©2013 Los Angeles Times

Visit the Los Angeles Times at

Distributed by MCT Information Services



Haven't they figured it out, the more they raise it the LESS people use it. The service is not better with the raise in price. Why would people pay more for it?


Privatize it.

Cliff Cannon

@Contango : Amen


Cut out Saturday delivery...heck, only deliver mail Mon, Wed and Fri.


what did they expect was gonna happen? if it's possible to be sent in .3 seconds, why not do it? why send it in the mail and have it take a few days? when 90% of bills can be paid online, why not do it? people are already paying for internet, so why not eliminate the need for checks, envelopes, or stamps if possible? it's called todays technology. thats what happens. raising prices isn't going to fix anything, thats DEFINITELY gonna make people get online and pay their bills instead of doing it through snail mail.


Our mail usually gets delivered to neighbors and vise versa anyway. So then WE have to go down the road to deliver the mail to the proper person. Also, our mailperson likes to leave the lid open, rain or shine. Does no good to discuss the issues as we all have, he doesn't listen or care.


I agree. Every time they raise the rates, the service seems to get worse. They have shot themselves in the foot and have nobody to blame but themselves.


The Postal Service wouldn't be in this mess if they had funded their retirement program.
The program was not funded for decades and now they have to catch up.
They operated as if they were a government agency, in deficit!


Please get your facts straight. Postal Service employees fall under either the Civil Service Retirement systerm or the Federal Employee Retirement System (FERS), based on their date of hire, used by all employees of the Federal Government, except members of Congress. Employees contributions are matched by the government.

The multimillion dollar fiasco you are referring to was forced on the Postal Service in 2006 to prefund employee retirement over the next 75 years. The Postal Service is the ONLY business, private or governement, that has been mandated to prefund retirment for employees that haven't even been born let alone hired.

That excessive burden along with overpayments into the Civil Service retirement, due to faulty calculations by Congress, has put the Postal Service in the financial bind they are in. Congress has refused to refund the overpayments and won't ablolish the prefunding mandate.

When the Postal Service was created the only mandate was to meet their expenses and deliver the mail to all addresses 6 days a week. The added expenses are all due to Congress looking for another cash cow to steal money from like they did with the Social Security funds. In effect collecting a hidden tax from anyone who uses the Postal Service.

To date there has been no mention when the current retirement systems will be terminated for Postal Workers and the new system activated so in effect you have three retirement systems receiving money from the Postal Service.

Contact your Congressional people and tell them to get off the Postal Service's back, refund the overpayment and stop the prefunding mandate. Oh, and let them start paying first class postage for all the mail they send out.


Re: "The Postal Service is the ONLY business, private or governement, that has been mandated to prefund retirment for employees that haven't even been born let alone hired."


Would you rather that the bill for present and future health and welfare benefits be paid by taxpayers?

"The best way forward is to cut our losses, deregulate the post office and sell it -- as has been done all over Europe."

"Understanding the Post Office’s Benefits Mess":

be for real

when some of them are standing around doing nothing for $30 an hour,Maybe they should cut down on the waste first and do away with the saturday delivery