(Image Source: Inquisitr)
BY JJ BAILEY
You're watching multisource video news analysis from Newsy.
Snow, rain, heat and gloom of night may not be able to stop the US Postal Service, but empty pockets might. US Postmaster General Patrick Donahoe has announced the USPS can’t make a 5 ½ billion dollar payment due this month, and could shut down by winter if nothing is done.
Facing over a nine billion dollar deficit, the Postal Service has already announced it’s considering closing over 4,000 branches to help combat it’s the issue. Many outlets, like ABC, responded by reporting the impact on small towns.
“This week the postal service turned 200, and it announced a new round of branch closings. The service has identified more than 4300 offices it might shut down, many of them in small towns that count on the local post office to link them to the outside world.”
“the people here want their post office to stay. I wish the economy were different and the post office was busier.”
But the problem is, post offices are getting slower and slower. With emails and electronic billing, ‘snail mail’ has been in a steady decline. But that’s not the only problem.
In a discussion on the ailing USPS last month on CNBC, analysts said the whole thing feels familiar; and sad as it may be, cuts need to happen.
“This is all very symptomatic, very similar to stories in other industries we’ve covered over the years. I mean, this reminds me of the automotive industry a few years ago when they couldn’t afford the health care or the pensions, they had legacy costs they had to deal with, and they had a business that was going down the tubes.”
The Postal Service reported that 80% of its costs were in labor. In order to get under budget, Donahoe says 120,000 jobs must be cut. And there’s more than jobs on the chopping block.
The Washington Post’s Joe Davidson calls Donahoe’s requests “drastic and radical”
“Donahoe, a 36-year-veteran of the Postal Service, wants Congress to allow USPS to bust the anti-layoff provisions in its union contracts. He also wants permission to pull his 563,000 employees from the health and retirement plans that cover federal employees so USPS can provide less generous programs.”
By September 30 the Postal Service will reach it’s borrowing limit of $15 billion. Donahoe claims the health care restructuring could save them $3.1 Billion. But union contracts have clauses to prevent layoffs and healthcare restructuring.
A writer for the Gothamist says not only should Congress provide help, but citizens need to pitch in as well.
most of us have been sending crappy e-cards to Grandma and refusing to set foot in those "crowded" post offices (but we'll wait 2 hours for Shake Shack?)... Think you don't need snail-mail? The agency will handle 167 billion pieces of mail this year, which is down 22 percent from 2006, but how else will the dentist remind you of your check up?
According to The New York Times, other cost-cutting measures range from advertising on postal trucks, stopping Saturday service, and apply for the right to deliver wine and beer.
Transcript by Newsy
 |  |  |  |
