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Will someone please explain finances to me?

Posted Monday, September 26, 2011, at 2:03 PM

I'm confused about the United States Postal Service (USPS). I saw a few of their ads on TV yesterday afternoon and then one already this morning. If the USPS is as broke as the government is telling us it is, how can they afford all those ads? Hopefully they didn't advertise during the Superbowl.

The USPS talks about closing more post offices, laying off employees, and cutting back on days it operates. Which cost more -- those services or the advertisements?

If a company has lost a great deal of money and complained about it all the time, would you expect them to run commercials on TV? Come to think of it, that's exactly what Chrysler and General Motors (GM) did. They never stopped running ads on TV, in newspapers, magazines, etc. I wasn't even thinking about those two corporations. If you are going belly up, do you just continue to spend money as if you have it?

The government gave GM a loan. Things got better for them, they repaid the loan, and we all lived happily every after.

I wonder if the government can give the USPS a loan. That would be like taking from one pocket and moving it to another. Guess that won't work.

I don't understand this very well. If a household lost percentage wise as much money as the USPS says it has lost, that household would already be bankrupt.


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GREAT INFORMATION WONDERWHY!! I read more of the info. and links from your post and copied a few. (see below) I couldn't agree more with your fear-mongering statement

The POST OFFICE DEPARTMENT of Benjamin Franklin was abolished in 1970 and replaced with the UNITED STATES POSTAL SERVICE, an independent corporate-like entity with an official monopoly.

There may not be DIRECT tax money going to them at this time, maybe only INDIRECTLY, but I belive the point Mrs. Brown was making was about Government bail out similar to what was done with GM.

The bailouts for the big banks and coorporations was indeed fear mongering. The "too big to fail" came out with other fear tactics for TARP and we have added about 5 trillion to our nation debt in only three short yrs. as a result.

The question is should we pay what it cost for the services we use? What is the true cost of sending a registered letter? If it is $12.00 and we only pay $4.00 then who pays the rest?

The USPS was supposed to be able to keep down their costs by being given a monopoly on Postal Delivery. That monopoly is the reason why I can't have my TG Paper placed in the U.S. MAIL box and had to buy another box and pole for my newspaper.

The Postal Reorganization Act of 1970 abolished the United States Post Office Department, a part of the cabinet, and created the United States Postal Service, a corporation-like independent agency with an official monopoly on the delivery of mail in the United States. Pub.L. 91-375 was signed by President Richard Nixon on August 12, 1970.[1]

The legislation was a direct outcome of the U.S. postal strike of 1970.

The mission of the Postal Service is to provide the American public with trusted universal postal service at affordable prices. While not explicitly defined, the Postal Service's universal service obligation (USO) is broadly outlined in statute and includes multiple dimensions: geographic scope, range of products, access to services and facilities, delivery frequency, affordable and uniform pricing, service quality, and security of the mail. While other carriers may claim to voluntarily provide delivery on a broad basis, the Postal Service is the only carrier with a legal obligation to provide all the various aspects of universal service at affordable rates.

Proponents of universal service principals claim that since any obligation must be matched by the financial capability to meet that obligation, the postal monopoly was put in place as a funding mechanism for the USO, and it has been in place for over a hundred years. It consists of two parts: the Private Express Statutes (PES) and the mailbox access rule. The PES refers to the Postal Service's monopoly on the delivery of letters, and the mailbox rule refers to the Postal Service's exclusive access to customer mailboxes.

Proponents of universal service principals further claim that eliminating or reducing the PES or mailbox rule would have an impact on the ability of the Postal Service to provide affordable universal service. If, for example, the PES and the mailbox rule were to be eliminated, and the USO maintained, then either billions of dollars in tax revenues or some other source of funding would have to be found. As the operating environment of the Postal Service continues to change, additional flexibilities will likely be necessary to fulfill the USO.

http://en.wikipedia.org/wiki/United_Stat...

-- Posted by Liveforlight on Thu, Sep 29, 2011, at 2:10 PM

The U.S. Postal Service has overpaid roughly $6.8 billion into the Federal Employees Retirement System, according to an Aug. 16 report from the agency's Office of the Inspector General.

The report said the Postal Service should use at least $5.5 billion of that money to shore up its rapidly declining finances. The Postal Service lost $3.8 billion in fiscal 2009, and expects to lose $7 billion this year.

The Postal Service's FERS overpayment is on top of an overpayment of anywhere from $50 billion to $75 billion into the Civil Service Retirement System, and a $13 billion overpayment into its future retiree health care liabilities, the OIG said. Those overpayments have made it tougher for the Postal Service to manage its finances and operate efficiently, the report said.

"Based on this data, the Postal Service's overfunding issue is even larger than we previously reported," the report said. "Postal Service ratepayers continue to pay more than their fair share of retiree benefits. It is important that the trend of overpayments does not continue."

When future expenses such as the FERS sick leave credit, inflation, and cost-of-living adjustments are taken into account, the Postal Service's actual FERS surplus declines to about $5.5 billion, the report said.

Joseph Corbett, the Postal Service's chief financial officer, and Marie Therese Dominguez, USPS vice president of government relations and public policy, agreed with the OIG that Congress should pass legislation to lower the agency's FERS payments. But they said in an Aug. 6 letter to investigators that passing such a change could be challenging because of the crowded congressional calendar and concerns over its budget impact.

http://www.federaltimes.com/article/2010...

There is more than meets the eye, and more than the fear mongers manipulate the people to go googoo over............... We just have to be open minded and care enough to check the FACTS and not rely on the puppet masters to feed us our information......................

-- Posted by wonderwhy on Thu, Sep 29, 2011, at 10:59 AM

The United States Postal Service (also known as USPS, the Post Office or U.S. Mail) is an independent agency of the United States government responsible for providing postal service in the United States. It is one of the few government agencies explicitly authorized by the United States Constitution.

The USPS traces its roots to 1775 during the Second Continental Congress, where Benjamin Franklin was appointed the first postmaster general. The cabinet-level Post Office Department was created in 1792 from Franklin's operation and transformed into its current form in 1971 under the Postal Reorganization Act.

The USPS has not directly received taxpayer-dollars since the early 1980s with the minor exception of subsidies for costs associated with the disabled and overseas voters. Revenue has been in freefall due to declining mail volume.[3] The postal service has attempted to look to other sources of revenue while cutting costs to reduce its budget deficit.[4]

The USPS employs over 574,000 workers and operates over 218,000 vehicles. It is the second-largest employer in the United States after Wal-Mart, and the operator of the largest vehicle fleet in the world.[5] The USPS is legally obligated to serve all Americans, regardless of geography, at uniform price and quality. The USPS has exclusive access to letter boxes marked "U.S. Mail" and personal letterboxes in the United States, but still competes against private package delivery services, such as UPS and FedEx.

http://en.wikipedia.org/wiki/United_Stat...

Reread the first paragraph - a few good points there,

"It is

one of the few government agencies explicitly authorized by the United States Constitution."-"independent agency of the United States government"""

in the second paragraph it points out -

"has not directly received taxpayer-dollars since the early 1980s with the minor exception of subsidies for costs associated with the disabled and overseas voters"

So to say it is draining the tax dollar is fictional............ other than the mail for the disabled and overseas voters ( listed above) this is not a government funded service. They are funded by themselves. They are NOT allowed to change/raise their rates like UPS and other delivery companies because they are REGULATED. Those regulations are why we are able to send items at reasonable rates ( To send a registered letter by a UPS store I was quoted over 12 dollars,I went to the post office and sent the same letter for about 4)

What I see is a lot of fear mongering intentionally spreading lie about the Postal Service being run with tax dollars and how we have to get rid of it.... Sorry but facts do not back that ----- the postal service is ran with it's own funds ( other than being reimbursed for the above listed service)

-- Posted by wonderwhy on Thu, Sep 29, 2011, at 10:48 AM

I use the USPS for most of my shipping. They are the cheapest carrier at this time. If they are going bankrupt, then obviously they are not running their business very well.

I mail products to my customers through the USPS and pass the cost on to them in the form of shipping charges. If I used anothe carrier I would pass on whatever charge they have to my customers as well.

The idea that our shipping is cheaper through the USPS may not really be true if we add in the cost of our tax dollars that are being sent to them to prop up a poorly managed business. Or, as Ms Brown put it, "taking from one pocket and moving it to another".

There are ways that costs could be cut for the USPS without losing services or increasing tax subsidies/spending.

For example:

People who are already taking tax dollars in the form of disability, welfare, etc., Could be utilized to bring down the labor cost of operation. Of course, that would mean some training and placement of persons with limited abilities into employment positions that they are capable of performing. Most anyone drawing a government check could run a mail route in their own neighborhood.

Simply corrections like this could lessen the tax burden on the citizens and make more money available to them to pay a higher price for the services they use.

It is not right to charge people for a service they don't use. If they are using email instead of snail mail, then why should they be taxed to prop up a business that they don't use just because it is collapsing into bankruptcy?

I can't understand that either, unless there are other motives.

-- Posted by Liveforlight on Wed, Sep 28, 2011, at 8:45 PM

I agree with you Ms. Brown. you would have to sell a lot of Postage Stamps to pay for those advertisements.

If they are going broke, Congress must be placing the ads with our money, or they may be free government ads.

The United States Postal Service is one of the very few powers the people gave to the government in the Constitution and they don't seem to be able to handle that power either.

The Postal Service is under the Authority of the United States government, but run by the IMF. Your local Post Office can be owned by one person, a general store or any responsible person in America. The Government rents the building or space, but the owner must keep up the repairs on their own. That is how the cheap government works.

Now it's under the United Nations because one of the U.N.'s members is the (UPU)

or Universal Postal Union.

The Universal Postal Union (UPU), headquartered in Berne, Switzerland, coordinates postal policies between member nations, and hence the worldwide postal system. Each member country agrees to the same set of terms for conducting international postal duties.

So you should be able to see how this makes sense.

The Unites States Postal Service has been able to cover its own expenses until the UPS, Fed Ex, and the Internet took customers away from its services. Even Banks will take you phone bills and Utility Bills and pay them for you. And of course AT&T has locations that you can walk in and pay cash for your phone service. Now the USPS can not pay salaries and retirement pensions etc from the stamps it sells.

BTW General Motors paid back its loan by using their second Stimulus money Package. Even I could pay back my first loan if I got a Free second loan.

Things got better for GM because the US gave them a Bailout loan then bought like 100 cars from them and gave them a second loan that was big enough to pay the first one off.

To comment on bomelsons' remark... anyone can buy stamps with their own photos on them for $5-$10 plus postage for a sheet of 20 stamps. You can have your photo or your family's photo or a picture of your dog on your own sheet of stamps.

Not a bad price to pay for a commemorative stamp of yourself if the internet quoted the right price. People would be encouraged to use their own personal stamps to send cards and letters to family members and friends.

What a great way to help the Postal Service and show off a little.

I personally do not want to see the Post Offices close. There are some things that must be mailed to others, like catalog sales and Birthday/Get Well/Christmas Cards and Wedding Invitations, etc..

I also like the Postal Money Orders. It is hard to find someone or business who will cash a stores' money order, but will take a Postal Money Order. And if not, you can always cash it at a Post Office.

I always used a Postal Money Order to pay my bills that I had to mail in because I didn't want the bank to return a check I thought was covered. You know how those banks are. They like to make money off their customers too.

I think every one should just go on down and buy a book of 1st class stamps just to have them around. You never know when one of your kids will come around with a letter they need mailed and NO STAMPS!

Okay, I've said enough.

-- Posted by Unique-Lies on Wed, Sep 28, 2011, at 7:19 PM

So what would be cheaper - keep the post office, find ways to make it more prosperous, or pay all the unemployment and assistance that putting what was it 16,000 people out of work? This is just a ploy to once again get rid of a service for the little guy by selling it off to corporations. Once it is in the hands of say, UPS I'll tell you how it will be ---- I recently needed to send a letter registered mail, I first went to the UPS store they wanted over 12 dollars to deliver it, I said no and went to the post office where I sent the same letter for 4 dollars................. The post office may not make huge profits, it may even be losing a bit - but it needs to be rethought, widen the services they provide and find ways to balance it.

In a time where we so in need of jobs it is crazy to create more jobless folks. Instead of putting all the money into unemployment benefits and what ever when they run out - put it back into the post office- preserve the jobs.

And NO Mike the union is not the cause of all the prob;ems, that's just corporations feeding those who don;t know any better more fear mongering to get them to pander to them. If not for the unions you would be making 20cents and hour and kissing feet to keep your job ( yes I know I fluffed the comment but it is the unions that are responsible for the good working conditions and befits the workers have - not just the union workers - when you have over time thank the unions, when you get Hoiday pay,thank the unions - it is the back bones of them and their workers who fought to get those rights you most likely enjoy)

-- Posted by wonderwhy on Tue, Sep 27, 2011, at 10:50 PM

Get rid of Saturday mail. There is no need. We typically only get a certain business' checks (or bills) on Saturday...and we don't deposit until Monday anyway. Banks are not open (or only open until noon) and the checks typically don't post until the next business day anyway and the only other thing that's delivered on Saturday are bills (who cares!) Will save tons of money. Unless someone can tell me any other reason for Saturday delivery, there is no need for it.

-- Posted by neighborhood mom on Tue, Sep 27, 2011, at 6:43 PM

I enjoy buying different stamps. When our supply of stamps is low, I actually pay them to deliver stamps to my box. It costs $1 extra, but there is such a variety offered online. Maybe it's because I send a lot of cards. Kids enjoy the cartoon stamps.

I am guilty of having stamps of Elvis and others stored away. I have an envelope with the stamp of the Tennessee State Capitol that was postmarked on issue date. At the time I worked in the Capitol. They probably make a little bit of money on the stamps.

-- Posted by bettyhbrown on Mon, Sep 26, 2011, at 10:37 PM

I don't pretend to know the figures, but the commemorative stamps are supposedly a moneymaker for the Postal Service, because when a stamp collector buys one, he or she is paying for delivery services that will never be used. It would be like buying a gift card for your favorite restaurant and then throwing it away by mistake -- you've just given the restaurant $25. Even if you set aside the gift card and don't use it until later, you're giving the restaurant use of your money interest-free.

There probably aren't as many dedicated stamp collectors as they used to be, but some of the stamps, especially the ones with celebrities, are obviously aimed at casual collectors -- someone who's a big fan of Elvis and so they buy an uncut sheet of Elvis stamps and frame it and hang it on the wall, that sort of thing. In some cases, the post office even sells T-shirts or pins or stationery with a picture of the stamp.

As I said, I don't know the exact figures. It could be that going to some other system -- bar codes or what have you -- could save more in efficiency than the commemorative stamps generate in revenue. But the commemorative stamps do bring in revenue, and so they're not a complete boondoggle.

-- Posted by Jicarney on Mon, Sep 26, 2011, at 4:01 PM

The post office is suffering from the same problems as GM and Chrysler, union employees whose benefit packages are no longer competitive in today's world.

Just like the big three, things were rosy until new competition came to town.

-- Posted by quietmike on Mon, Sep 26, 2011, at 2:58 PM

In order to make money, you have to spend money. So commercials are part of the spending - trying to get the word out to what they offer. Because they are losing business to the internet and delivery services like FedEx and UPS.

The USPS is saying that they are losing money because people are paying bills via the internet. If the USPS DIDN'T lose so much mail, destroy mail, and sometimes steal it... then people could still depend on the mail.

As for the "fancy stamps", I don't see the since of all of them. I don't care what the stamp looks like as long as it is enough to mail the envelope.

-- Posted by PrpleHze on Mon, Sep 26, 2011, at 2:35 PM

How much money is lost on printing so many commemorative stamps recognizing practically everyone except you and me?

-- Posted by bomelson on Mon, Sep 26, 2011, at 2:22 PM


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