The Post Office Lesson

                     

The U.S. Postal Service loses well over $ billions a year; well over $240 billion estimated over the next ten years. A

report from the Government Accountability Office says the Post Office's business model is not sustainable.

                       

Demand for conventional mail has been falling. First-class mail volume has declined about 20 percent since its peak in 2001. Even though the post office has cut staff and branches, it isn’t enough correction. While the post office is supposed to pay for itself, it has been covering its losses by borrowing from the Treasury. But it’s nearing its borrowing limit.. Treasury, plus unfunded pension and retiree health obligations and liabilities tops $90 billion.

                       

Wages and benefits account for 80 percent of Post Office expenses, exceeding those of other highly paid federal workers. To compound problems, about 85 percent of its postal employees are covered by union contracts which force the use of more full-time employees than are necessary; and restrict flexibility, outsourcing and layoffs.

                       

Also, the Post Office pays more for employees health and life- insurance than most other government agencies.

                       

A lesson of what to eventually expect from all government- sponsored programs. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)