USPS to Cut Another 35,000 Jobs: Can the Post Office Be Saved? Should It Be?
The U.S. Postal Service plans to eliminate 35,000 jobsstarting this summer by closing or consolidating 223 mail processing plants.
In the last quarter of 2011, the Postal Service lost $3.3billion due in large part the retirement and healthcare benefits it owes tofuture retirees as well as decreased volumes of mail being sent. The cuts arepart of the agency's plan to avoid an $18 billion loss by 2015 if nothing isdone.
In an effort to prevent further bleeding, the Postal Servicereleased a five-year plan to Congress outlining ways the agency could cutspending and raise revenue earlier this month. The plan includes proposals suchas ending Saturday delivery, closing post offices and cutting jobs in additionto raising the price of a first-class stamp from to $0.45 to $0.50.
Raising the price of postage five cents could add $1 billionin revenue and the agency expects this latest consolidation of plants and jobcuts to save $2.1 billion.
While the Postal Service continues to slash costs andservice, people are starting to wonder whether the day will come when theagency will cease to exist.
"There is a huge difference between what the PostOffice is being forced to do now and the Post Office disappearingcompletely," says The Daily Ticker's Henry Blodget, who believes thatwhile the agency may have to restructure, it is not going anywhere. "Thereality is people are sending less physical mail than they used to [and] we donot need the Postal Service of the same size."
Many of the plants to be effected by this consolidation willbe in rural areas. For such small communities, these closing will have a hugenegative impact on the quality of life in terms of both jobs and the fabric ofthe society, as going to the Post Office for some remains a social experienceand a way to actually see government in action, as Aaron Task points out in theaccompany video.
The harsh reality is that dealing with debt has become atheme of the times. The U.S. faces a $1.3 trillion deficit. States across thecountry are facing budget shortfalls and across the pond Greece and otherEuropean nations face crippling debt issues. The USPS is just one more instanceof an entity that needs to cut back. Both Aaron and Henry agree, the PostalService needs to change but is not going anywhere anytime soon.
In the video above, Aaron says he thinks one fair solutionwould be to raise the price of a first-class stamp dramatically to at leastdouble its current $0.45. Tell us what you think and how much would you bewilling to pay for postage a first-class stamp.