The only financial solution for the US Postal Service: giving the USPS to the worker pension and insurance funds
I have written about the Post Office quite a bit. It's an important institution because it's the only federal government agency that operates in every community. Post offices are federal outposts and community centers.
But in the 1970s the US Postal Service was sort of privatized. It was promulgated that the service had to be financially self-sufficient and that no federal funds would be provided to the agency. But Congress retained oversight, and the various postal worker unions are strong supporters of those Congresspeople sitting on the various oversight committees. USPS managers argue that frequently, Congressional oversight and the Postal Rate Commission tie their hands in terms of making economically sound business decisions.
In "Rethinking community planning around maintaining neighborhood civic assets and anchors" (and in "Historic preservation aspects of US Post Office downsizing") I argued that the community building element of the post office function is something that local communities should consider "subsidizing," because the USPS receives no federal funds. Somehow a subsidy may need to be found in order to maintain post offices in those communities where the day to day "revenues" of the office are below the cost of running the facility. (Although I have also argued that post offices could become entrepreneurial workspaces too, see "Post offices reconceptualized as small business support centers.")
With all the financial strictures on the USPS plus the ongoing problem of a fall off in mail volume--I saw an ad somewhere stating that a 20% reduction in mailing utility bill payments would result in X% reduction of something or other.
There are 150 million US households (roughly); 20% is 30 million. x 12 bills = 360 million mailed letters in one year that are foregone, for a loss of revenue totaling $165.6 million. That adds up.
In the Kodak bankruptcy, to release claims from the British Kodak workers pension fund, Kodak gave to the pension fund its US document imaging business.
Similarly, in the bankruptcies of Chrysler and GM, the insurance responsibilities were hived off into a separate trust and funded in part by newly issued corporate stock (e.g., "Report: UAW trust to get 17.5% of GM shares," from ABC News).
Last week, Royal Mail, the postal service in the UK, announced plans to privatize, and a stock offering is imminent. They announced that 10% of the stock will be given to the workers, likely to stave off opposition to the privatization. (Postal services on the continent privatized many years ago.) According to this story "Royal Mail privatisation - the key questions answered" in the Guardian, the stock given to each employee will be worth about $3,000.
Maybe the USPS should be fully privatized, but with ownership vested fully in the various worker pension and insurance funds, in order to cover the financial liability for those funds. It would be interesting to see how the fund managers would manage the "company" going forward in order to cover the obligations.
Likely it would mean job losses, which is why the British postal workers oppose privatization.
Note that the reason the Post Office is in dire financial straits is that Congress has required the agency to prefund the next 75 years of pensions, requiring huge annual payments that exceed revenues. Someone who is more cynical and a better observer than I pointed out that this was done deliberately, in order to break the unions.