Financial Times (May 14, 2013)
In the UK, the state-owned Royal Mail may be taken public this fall in line with legislation passed in 2011. In marked contrast to the U.S. Postal Service, which is hemorrhaging money, the Royal Mail’s “fortunes have been improving as a result of modernisation and the boom in internet-related packet deliveries,” leading observers to value it at £2bn-£3bn.
Tags: Boom, Internet, IPO, Legislation, Royal Mail, UK, USPS
Washington Post (April 15, 2013)
“The U.S. Postal Service (USPS) faces a financial death spiral. Burdened by excess infrastructure, outmoded regulations and high labor costs — not to mention facing digital-age obsolescence — USPS posted an operating loss of $15.9 billion in fiscal 2012 and is on course to lose an estimated $7.9 billion in fiscal 2013.”
Tags: Digital age, Infrastructure, Labor, Operating loss, Regulations, U.S., USPS
Wall Street Journal (February 8)
“Is there a better tutorial in government failure than a monopoly that loses about $25 million every day, like the U.S. Postal Service now?” With first-class volumes down a quarter in six years, drastic change is needed. The USPS wants to restructure, but is largely hamstrung by Congress. The latest plans will end Saturday delivery to save about $2 billion a year, but this would “still only solve about one-eighth of its financial problem.”
Tags: Congress, First-class, Mail, Monopoly, Restructure, Saturday delivery, U.S., USPS
New York Times (May 11)
Congress is “slower than snail mail.” The United States Postal Service (USPS) needs to make reforms. Unfortunately, these require Congressional agreement. While Congress delays, the USPS “is running deficits of $36 million a day. It will go bankrupt this year and annual losses could rise to $21 billion a year by 2016.”Congress is “slower than snail mail.” The United States Postal Service (USPS) needs to make reforms. Unfortunately, these require Congressional agreement. While Congress delays, the USPS “is running deficits of $36 million a day. It will go bankrupt this year and annual losses could rise to $21 billion a year by 2016.”
New York Times (September 5)
The United States Postal Service (USPS) stands on the verge of bankruptcy. Volume has been shrinking in the digital age and the USPS deficit is expected to reach $9.2 billion by the end of the current fiscal year. The postmaster general, Patrick R. Donahoe, is seeking Congressional approval of his plan for “eliminating Saturday mail delivery, closing up to 3,700 postal locations and laying off 120,000 workers.” Without drastic measures, the USPS will default on pension payments this month and “sometime early next year… run out of money to pay its employees and gas up its trucks… forcing it to stop delivering the roughly three billion pieces of mail it handles weekly.”
Wall Street Journal (May 14)
The next federal bailout will be the United States Postal Service (USPS). Congress gave the USPS a $15 billion line of credit, but with Q1 losses of $2.2 billion (a 25% increase over last year), the credit “will be used up by the end of this year, with low odds on ever being paid back.” E-mail has battered the USPS. By decade end, 20 billion fewer letters will be mailed according to current projections. Instead of cost-cutting, however, the USPS has offered its union workers a new 4.5 year contract with a 3.5% pay raise, cost of living wage hikes and protections against layoffs. The WSJ wishes USPS management would protect taxpayers instead.
