The United States Postal Service has been fighting for its financial life. Everybody knows that. Soon after he was elected in 2016, President Trump even went so far as to establish a Postal Task Force with the mission to find out what’s wrong with USPS’ finances. Despite long hearings and circular debates, no party has yet to present any actionable conclusions. However, in the next few weeks, we should finally start seeing some strides to move in the right direction. After struggling the past 10 years to stay afloat, USPS will deliver a plan to Congress this summer that will hopefully outline a clear path to financial stability.
Why The Postal Service Needs to Make a Plan to Survive
The Postal Service needs a plan because they are running out of cash to operate, plain and simple. During a hearing hosted by the House Committee on Oversight and Reform, Postmaster General Megan Brennan stated the issue clearly.
“If we make our legally mandated payments in 2019, we will be out of cash in 2020,” she said.
Unfortunately, President Trump’s Postal Task Force hasn’t been much help on the issue. While the task force has concluded that USPS is indeed experiencing financial troubles, its members haven’t presented any actionable solutions.
The Problem USPS Currently Faces (that Congress Created)
While a lot of people are quick to assume that USPS just can’t get their act together, it’s a bit more complicated than that. The real problem with USPS’ finances is pre-funding legislation that Congress enacted in 2006. This legislation requires USPS to set aside huge portions of their revenue every year for the sole purpose of paying for future employees’ retirement and health benefits. Interestingly enough, some of these employees that USPS currently sets money aside for haven’t even been born yet!
Pre-funding legislation is the real reason why USPS lost $3.9 billion in 2018. In fact, once Congress enacted the legislation, USPS has suffered a wider loss every single year.
Here’s to hoping the plan that USPS delivers this summer sees Congress eliminating this onerous financial burden on the Postal Service. It’s no exaggeration to say that getting rid of it is the only way the Postal Service will survive.