10 Remedies for an Ailing Postal Service
The 800-pound gorilla in the room regarding the Postal Service deficit is a Congressionally mandated schedule -- of about $5.5 billion in pre-funding payments each year -- to stave off potential liabilities in its employee pension fund.
A statement by unions taking part in the rally Tuesday stresses that the current shortfall "doesn't result from mail delivery."
"The $20 billion in postal losses you've heard about stems from a 2006 congressional mandate that the Postal Service pre-fund future retiree health benefits for the next 75 years and do so within a decade -- a burden no other public agency or private firm faces," the statement reads. "The Postal Service is actually paying, out of its operating budget, for the future retiree benefits of people who haven't been born yet. That cost -- $21 billion since 2007 -- accounts for 100% of the agency's red ink over that period.""The importance of dealing with the pension system, first and foremost, cannot be overstated," Hutkins says. "This deficit is an imaginary thing that was created by Congress demanding how the Postal Service funds its pension and retiree health care programs. So what you have is, essentially, a manufactured crisis, not a real one." "The other big financial problem, which also has nothing to do with the mail, is that the Postal Service doesn't have access to tens of billions of dollars of earned revenue that are sitting in surplus funds," the statement by postal unions adds. "As a quasi-public agency, it needs Congress to give it access to its own money." The various postal unions have voiced their support of H.R. 1351, the United States Postal Service's Pension Obligation Recalculation and Restoration Act of 2011, filed by U.S. Rep. Stephen Lynch, D-Mass. The bill, which has bipartisan support and more than 200 co-sponsors, seeks to remedy the pre-funding issue by restructuring the annual payment and refunding nearly $7 billion critics say was overpaid. The Obama administration favors the refund.
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