This morning’s USA Today editorial on the US Postal Service rightly condemns the House for wasting time on political grandstanding while avoiding the tough decisions needed to save the USPS and the mailing industry. But the paper gets its facts muddled when it tries to analyze the problem.
The editorial makes this claim, for instance:
Since the Senate approved an overhaul measure in April, the Postal Service has lost more than $2 billion while the House has dawdled.
That statement is only correct if you include the charges the USPS has taken for the monthly share of two years’ worth of PAEA pre-funding. It is not money that the USPS has actually paid out- and it’s money that the USPS doesn’t have.
That’s important, because in the next paragraph, the paper says this:
Postal unions and some in Congress blame the woes largely on the huge annual payments Congress decided to require the Postal Service to make to fully pre-fund its retiree health benefits plan for 75 years. Union officials argue that without these onerous payments, the Postal Service could fairly easily solve its remaining problems.
If only that were so.
Well, let’s check the numbers and see whether or not it is so.
The May USPS financial report does indeed show a net loss of just over $2 billion, as the paper says. The portion of that loss due to postal operations is $353 million. That’s a serious loss, and whether you blame it on the economy, electronic diversion, or poor management, it’s something the USPS needs to deal with, and soon.
But the other $1.7 billion, or eighty two percent of the total loss, is the direct result of PAEA.
It’s nonsense to claim that PAEA is the sole cause of the postal service’s problems- but it’s insanity to deny that it’s the chief cause.
Politicians, pundits and the PMG casually toss around millions and billions of daily and monthly “losses”, but the one number you never hear them mention is the really big number- $44 billion. That’s the total of past USPS profits and interest that is sitting in the Treasury, serving mainly to make a slight dent in the national debt. How does a dying business, with a supposedly “bloated” infrastructure, pile up $44 billion in spare change, and keep running?