July 22, 2011 5:59 AM
ABC News' Amy Bingham reports:
America's second-largest employer is in apocalyptic straits and it's all the Internet's fault.
The U.S. Postal Service is confronting an $8.3 billion bill shortfall this year, in considerable segment since losing roughly half of its initial category letter to online bill pay and email communication.
After laying off 110,000 employees and slicing $12 billion over the past 4 years, the service is right away seeking to finish letter smoothness on Saturdays, a pierce it mentioned would save $3.1 billion per year.
"That's extra savings that you desperately need," mentioned U.S. Postal Service orator David Partenheimer. "It's not the usually thing you must be do to obtain out of the financial hole but it is really important."
According to a 2009 Gallup Poll 66 percent of Americans are OK with the postal service slicing letter smoothness on Saturdays, but far fewer enouragement profitable more for their mail.
Just 38 percent of respondents were in preference of raising stamp prices and reduction than half, or 48 percent upheld pumping taxation revenues in to the letter system.
But even inside of the postal system, there is discord over either a five-day smoothness network will obviously compromise the problem. Despite not delivering mail, post offices would stay open, demonstrate or overnight letter would still be delivered and P.O. boxes would still take mail.
The Postal Regulatory Commission, a president-appointed group that oversees the Postal Services' operations to make sure it doesn't abuse its monopoly, estimated that slicing a smoothness day would take 3 years to entirely exercise and woul! d usuall y save $1.7 billion per year thereafter.
"The key reason is that the Postal Service thinks it can take all the letter that it would instead broach on Saturday and broach it on Monday with no extra cost," mentioned regulatory assignment chairperson Ruth Goldway. "When you look at the operations it just can't happen."
Despite not reception any taxpayer money, the USPS is technically a supervision agency, so to be able to discard a smoothness day it has to obtain Congressional approval. Partenheimer mentioned it has been perplexing to obtain consent since 2009, but this is the initial year any legislation has been introduced.
While a edited smoothness report would help shut the bill gap, both Partenheimer and Goldway mentioned the actual situation is the $5.5 billion the Postal Service has to pay every year in to a account is to illness benefits of its future retirees.
"That's the actual constructional complaint is to Postal Service right now," Goldway said.
Goldway mentioned without the retirement account payments, that were mandated starting in 2006, the letter service would be posting profits.
"If the Postal Service hadn't had to pay this over the past 6 years, as of 2010 it would have finished with $1 billion excess and still have $12 billion to 13 billion left to steal from borrowing fund," Goldway said. "Instead, at the finish of 2011 it will finish up with no money and an void borrowing fund."
As it stands now, USPS will not be able to make the remuneration by its September due date, Postmaster General Patrick Donahoe told USA Today on Wednesday.
"On September 20th, I won't be able to pay my bills," Donahoe said.
Rep. Darrell Issa, R- Calif., the chairperson of the House Oversight Committee, introduced a bill that would that would emanate a congressionally-appointed assignment to take over the Postal Service if it did, in fact, skip the payment. Issa's orator Ali Ahmad mentioned the ob! jective of the assignment would be to obtain the Postal Service back in the black.
"For an establishment that is hemorrhaging money and is saying a major reject in final for their products... it creates best clarity because taxpayers are going to be on the offshoot for this," Ahmad said.
A associate of the Oversight Committee Staff mentioned the considerable retirement illness module payments are vital because without a hoard of funds, USPS will face the same complaint Social Security is right away struggling with. As revenues go on to drop, it will have to pay out more in illness benefits than it is taking in.
If USPS cannot pay for its employees illness caring expenses during retirement, that weight will drop to the sovereign government, the staffer said.
If Issa's bill passes, his assignment will not be about "helping the Postal Service prevent obligations," similar to the retirement pre-payments, but will instead find ways to cut expenses so the $5.5 billion reirement account payments can continue, the cabinet staffer said.
"Unless there is actual constructional reform, the Postal Service won't be here in two years, let alone 10," the staffer said. "They haven't been able to lower expenses to encounter the fact that 20 percent of letter volume is vanished and, frankly, is not forthcoming back."