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Andrea Stone Senior Washington Correspondent
WASHINGTON (March 2) -- The U.S. Postal Service delivered the bad news today about your mail delivery: It's going to keep getting worse.
Citing "unprecedented volume declines" in what has derisively become known as snail mail, Postmaster General John Potter announced a projected $238 billion shortfall in revenues over the next decade that will require deep cuts if the independent agency founded by Benjamin Franklin is to survive in the Internet age.
"The crisis we're facing gives us an historic opportunity to make changes that will lay the foundation for a leaner, more market responsive Postal Service that can thrive far into the future," Potter said in announcing a series of steps to deal with the fiscal crisis.
Among the fixes he's proposing:
-- Cut back from delivering mail six days a week to five.
-- Restructure retiree health benefits payments to conform with the rest of the federal government and most of the private sector. Under current law, the agency pays $5.4 billion to $5.8 billion annually to prefund retiree health benefits, often resulting in overpayment.
-- "Modernize" customer access. Translation: close underutilized post offices and provide services in more convenient locations like grocery stores, pharmacies, retail centers and office supply stores. The plan would also increase the number of self-service kiosks and improve the postal service website.
-- Reduce the size of the workforce through attrition; more than 300,000 employees will reach retirement age in the next decade.
-- Increase stamp prices in 2011.
Those moves and more come as mail volume is projected to fall from 177 billion in 2009 to 150 billion in 2020. First-Class mail alone has plummeted 37 percent , with revenues expected to drop. Revenue contributed by First-Class Mail will plummet from 51 percent today to about 35 percent in 2020.
In the last quarter, which included Christmas -- the heaviest volume period of the year -- the Postal Service lost $297 million.
Those weren't the first losses, which have been mounting for years and were made worse by rising unemployment and the economic downturn.
So it was hardly a surprise when Potter asked Congress earlier this year to do away with the law that requires mail be delivered six days a week. He is expected to submit a formal request to the Postal Regulatory Commission by the end of this month to get permission to deliver mail only on week days. Although there will be much sorting out before the Postal Service can follow through with its plan -- including getting Congress to agree -- the future trajectory is clearly bleak.
More people are paying their bills online. Fuel costs are rising. Health care benefits for postal employees is soaring like everyone else's. And mail-order catalogs are being supplanted by retail websites.
"Lifestyles and ways of doing business have changed dramatically in the last 40 years, but some of the laws that govern the Postal Service have not," Potter said. "These laws need to be modernized to reflect today's economic and business challenges and the dramatic impact the Internet has had on American life."
Americans seem resigned to the changes. A Gallup Poll in June found 66 percent favor going to five-day-a-week delivery to make up for the postal service's financial losses. The least favorite solution, with 88 percent opposed, was closing a local post office -- an idea the Postal Service suggested last summer when it proposed shutting or consolidating more than 150 post offices across the country.
As if things weren't tough enough for the Postal Service, this winter showed it has hardly lived up to its supposed slogan -- "Neither snow nor rain nor heat nor gloom of night stays these couriers from the swift completion of their appointed rounds." During last month's mega-snowstorm in Washington, some customers went for a week or more without mail.
Like newspapers and other businesses that relied on paper, the Postal Service has flailed around for years trying to reverse the electronic trend. The latest series of proposals come after it paid $4.8 million to three outside consulting firms to come up with ways to cut costs and provide new services. The studies by Boston Consulting Group, Accenture and McKinsey and Co. outlined more than 50 ways the agency could address volume declines that will not reverse.
Filed under: Nation, Top Stories
Since the Post Office took out the self service vending for stamps and such, I said "screw it" and use Fedex and the internet. The Post Offices' hours are not good for the normal workweek either, so buh-bye.
WASHINGTON (March 2) -- The U.S. Postal Service delivered the bad news today about your mail delivery: It's going to keep getting worse.
Citing "unprecedented volume declines" in what has derisively become known as snail mail, Postmaster General John Potter announced a projected $238 billion shortfall in revenues over the next decade that will require deep cuts if the independent agency founded by Benjamin Franklin is to survive in the Internet age.
"The crisis we're facing gives us an historic opportunity to make changes that will lay the foundation for a leaner, more market responsive Postal Service that can thrive far into the future," Potter said in announcing a series of steps to deal with the fiscal crisis.
Among the fixes he's proposing:
-- Cut back from delivering mail six days a week to five.
-- Restructure retiree health benefits payments to conform with the rest of the federal government and most of the private sector. Under current law, the agency pays $5.4 billion to $5.8 billion annually to prefund retiree health benefits, often resulting in overpayment.
-- "Modernize" customer access. Translation: close underutilized post offices and provide services in more convenient locations like grocery stores, pharmacies, retail centers and office supply stores. The plan would also increase the number of self-service kiosks and improve the postal service website.
-- Reduce the size of the workforce through attrition; more than 300,000 employees will reach retirement age in the next decade.
-- Increase stamp prices in 2011.
Those moves and more come as mail volume is projected to fall from 177 billion in 2009 to 150 billion in 2020. First-Class mail alone has plummeted 37 percent , with revenues expected to drop. Revenue contributed by First-Class Mail will plummet from 51 percent today to about 35 percent in 2020.
In the last quarter, which included Christmas -- the heaviest volume period of the year -- the Postal Service lost $297 million.
Those weren't the first losses, which have been mounting for years and were made worse by rising unemployment and the economic downturn.
So it was hardly a surprise when Potter asked Congress earlier this year to do away with the law that requires mail be delivered six days a week. He is expected to submit a formal request to the Postal Regulatory Commission by the end of this month to get permission to deliver mail only on week days. Although there will be much sorting out before the Postal Service can follow through with its plan -- including getting Congress to agree -- the future trajectory is clearly bleak.
More people are paying their bills online. Fuel costs are rising. Health care benefits for postal employees is soaring like everyone else's. And mail-order catalogs are being supplanted by retail websites.
"Lifestyles and ways of doing business have changed dramatically in the last 40 years, but some of the laws that govern the Postal Service have not," Potter said. "These laws need to be modernized to reflect today's economic and business challenges and the dramatic impact the Internet has had on American life."
Americans seem resigned to the changes. A Gallup Poll in June found 66 percent favor going to five-day-a-week delivery to make up for the postal service's financial losses. The least favorite solution, with 88 percent opposed, was closing a local post office -- an idea the Postal Service suggested last summer when it proposed shutting or consolidating more than 150 post offices across the country.
As if things weren't tough enough for the Postal Service, this winter showed it has hardly lived up to its supposed slogan -- "Neither snow nor rain nor heat nor gloom of night stays these couriers from the swift completion of their appointed rounds." During last month's mega-snowstorm in Washington, some customers went for a week or more without mail.
Like newspapers and other businesses that relied on paper, the Postal Service has flailed around for years trying to reverse the electronic trend. The latest series of proposals come after it paid $4.8 million to three outside consulting firms to come up with ways to cut costs and provide new services. The studies by Boston Consulting Group, Accenture and McKinsey and Co. outlined more than 50 ways the agency could address volume declines that will not reverse.
Filed under: Nation, Top Stories
Since the Post Office took out the self service vending for stamps and such, I said "screw it" and use Fedex and the internet. The Post Offices' hours are not good for the normal workweek either, so buh-bye.
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