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Stamp prices expected to rise to 46 cents

By Ed O'Keefe

Updated 12:05 p.m. ET
The cost of a postage stamp will climb 2 cents to 46 cents in January if the U.S. Postal Service earns approval for new rate hikes announced Tuesday. The proposed increases push prices beyond the rate of inflation for the first time as USPS tries to close a $7 billion budget gap amid plummeting revenues and mail volume.

Customers who purchase Forever stamps before the price increase could still use them without paying for additional postage. Prices also would increase to 30 cents for postcards and magazine publishers would see an 8 percent price jump, according to the proposals.

By law the Postal Regulatory Commission must approve the rate increase after USPS demonstrates, “exceptional or extraordinary circumstances” for the price jump. Regulators are expected to announce their decision by early October.

The Affordable Mail Alliance, a new coalition representing more than 100 businesses and nonprofits opposed to price hikes, said it will tell regulators that USPS should make deeper cost cuts before raising rates.

Tony Conway, an alliance spokesman, said the Postal Service's delivery network "is a system that’s built to handle about 300 billion pieces of mail and they’ve got about 170 billion and it’s set to decrease. It’s basically twice as big as it needs to be. It’s that excess capacity and costs that are creating the need in their minds to do this."

The Postal Service has cut more than 200,000 jobs through attrition and will trim $3.5 billion in costs by Sept. 30, said Maura Robinson, USPS vice president for pricing.

"We’re going to continue those cost and operational improvement programs," Robinson said.

First-class stamps have cost 44 cents since May 11, 2009, and first-class mail volume continues to drop. Price increases for other types of mail and packages also will likely cause further declines.

The proposed price hikes come as the Postal Service anticipates losing at least $6.5 billion in the fiscal year that ends Sept. 30 and another $7 billion next year.

The price hike is part of a far-reaching package of proposed reforms sought by the Postal Service to close an anticipated nine-figure budget gap in the next decade. Officials want Congress to end required prepayments for retiree health benefits and want to end mail deliveries on Saturdays. But reform efforts are complicated this year by the midterm elections and other economic concerns.

Leave your thoughts in the comments section below.

By Ed O'Keefe  | July 6, 2010; 9:22 AM ET
Categories:  Agencies and Departments  
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Comments

“This proposed rate increase amounts to another tax imposed on Americans at a time when the economy can least afford it,”

If FedEX or UPS increased their rates, would it be catagorized as a "tax"? Unless Congress is willing to subsidize the USPS, then it needs to be allowed to be run like a business. You can't have it both ways.

Posted by: jmichaelharris1959 | July 6, 2010 9:48 AM | Report abuse

Just raise the postage on a first class stamp to 50 cents already. it will make things simplier.

Posted by: MarilynManson | July 6, 2010 10:07 AM | Report abuse

How about starting with ALL postal employees pay and benefits. What would it cost to outsource the post office? 3 day a week for residential and 5 day a week service for business routes should help. Many ways to cut expenses IF the post office wanted to.

Posted by: gmclain | July 6, 2010 10:11 AM | Report abuse

The percentage of rates at which the cost of 1st class postage has risen since Ronald Reagan took office.

Ronald Reagan from 20 to 25 cents 25%
George H. Bush 25 to 29 cents 15.3%
Bill Clinton 29 to 34 cents 14.7%
George W. Bush 34 to 42 cents 19.1%
Barack Obama 42 to 44 cents 4.8%

Posted by: bstrauss0913 | July 6, 2010 10:15 AM | Report abuse

I just wish that UPS and FedEx could carry first-class mail. Their employees are much more polite, customer-friendly, and service-oriented than USPS employees. I can't remember the last time I sent a package or chose to have a package sent to me via the Postal Service.

Posted by: WashingtonDame | July 6, 2010 10:28 AM | Report abuse

USPS loses $7B per year. Eliminating Saturday delivery would save $2B - $3B (depending on who you read).

Eliminate Saturday delivery, OR reduce service during the week. For example, one neighborhood gets delivery on Mon, Wed, Fri - and another on Tues, Thur, Sat.

Fire 10% of the workers (based on performance, not seniority. Reduce remaining salaries 10%. Increase working hours by 10%.

So, ya wanna go postal?

Posted by: AlanBrowne | July 6, 2010 10:53 AM | Report abuse

Instead of rate increases USPS can eliminate millions of dollars of waste caused by lost worker time when mail carriers take unauthorized cigarette breaks and other time off at apartment complexes where they use their influence to obtain keys to gated and locked private facilities, such as recreation rooms and swimming pools.

Here is a complaint recently submitted to USPS online:
On June 11, 2010 hold mail was requested by me to end June 16, 2010,and I arranged to be at home all day on June 16, 2010 to receive the volume of mail expected to exceed the capacity of my mailbox. The day before, when I returned home from travel, staff in the apartment complex office knew I had been gone because the mail carrier had told them of the hold mail.

On June 16, 2010 at about 1:45 p.m. as I left my apartment I saw the regular mail carrier for my address driving away from the mail box cluster where my mailbox is located but when I opened it there was no mail at all. The mail carrier was at the next cluster and when I walked to that one and asked where my hold mail was he reached to his left without needing to look, picked up a folded 8 ½ X 11 printed sheet, removed 4 pieces of mail from the fold, and handed it to me. He kept the sheet of paper and didn’t mention my hold mail but when I did he said “You got a lot of mail!”

His tone of voice, facial expression, and body language conveyed annoyance and resentment.

I replied that I stayed home to receive all that mail and asked him why he didn’t bring it but he refused to answer.

About 15 minutes later I was at the recreation center of the apartment complex when I saw the same mail carrier with a large quantity of mail under his arm open the locked swimming pool gate with a key attached to a chain with all of his other keys, then unlock the recreation room door with that key and enter. There was no one in the room and it is not the address for any postal customer. He emerged several minutes later and left the way he came in, again with his own key unlocking the pool gate to exit. The key is not needed to access any mailbox on the property.

This complaint, which includes photographic evidence of the mail carrier at the recreation center with a large quantity of mail, seeks an end to willful misconduct by this
USPS employee who:

Violated postal rules by knowingly and deliberately failing to deliver hold mail after the hold ended. He knew all about the volume of mail which had accumulated and there were no events or conditions preventing delivery of the mail.

Violated postal rules by knowingly and deliberately confiscating mail in his possession in the USPS vehicle instead of delivering it to my mailbox, handing it over to me in person only after I asked for it. Again, there were no events or conditions preventing delivery of the mail.

Violated postal rules by requesting and keeping under authority as a mail carrier a key to access private property which is not the home or business addr

Posted by: C_DIVER | July 6, 2010 11:53 AM | Report abuse

I think someone should examine the waste associated with free boxes from the post office for priority mail services. You have to order in quantities of 10 or 25 boxes even if you only need 1. The post offices do not have the boxes on hand and instruct you to request them online. I ordered 10 to get 1 and then threw the rest away.

When I wrote the Post Master General, Mr Potter, with a cost savings suggestion he didn't even read the email. It was deleted without being read. I think any cost saving suggestions warrants a review by the Post Office, even if it is just discounted as being junk.

After seeing their arrogance I don't think that they deserve the increase.

Posted by: vbritt | July 6, 2010 11:59 AM | Report abuse

Instead of rate increases USPS can eliminate millions of dollars of waste caused by lost worker time when mail carriers take unauthorized cigarette breaks and other time off at apartment complexes where they use their influence to obtain keys to gated and locked private facilities, such as recreation rooms and swimming pools.

Here is a complaint recently submitted to USPS online:
On June 11, 2010 hold mail was requested by me to end June 16, 2010,and I arranged to be at home all day on June 16, 2010 to receive the volume of mail expected to exceed the capacity of my mailbox.

On June 16, 2010 at about 1:45 p.m. as I left my apartment I saw the regular mail carrier for my address driving away from the mail box cluster where my mailbox is located but when I opened it there was no mail at all. The mail carrier was at the next cluster and when I walked to that one and asked where my hold mail was he reached to his left without needing to look, picked up a folded 8 ½ X 11 printed sheet, removed 4 pieces of mail from the fold, and handed it to me. He kept the sheet of paper and didn’t mention my hold mail but when I did he said “You got a lot of mail!”

His tone of voice, facial expression, and body language conveyed annoyance and resentment.

I replied that I stayed home to receive all that mail and asked him why he didn’t bring it but he refused to answer.

About 15 minutes later I was at the recreation center of the apartment complex when I saw the same mail carrier with a large quantity of mail under his arm open the locked swimming pool gate with a key attached to a chain with all of his other keys, then unlock the recreation room door with that key and enter. There was no one in the room and it is not the address for any postal customer. He emerged several minutes later and left the way he came in, again with his own key unlocking the pool gate to exit. The key is not needed to access any mailbox on the property.

This complaint, which includes photographic evidence of the mail carrier at the recreation center with a large quantity of mail, seeks an end to willful misconduct by this USPS employee who:

Violated postal rules by knowingly and deliberately failing to deliver hold mail after the hold ended. He knew all about the volume of mail which had accumulated and there were no events or conditions preventing delivery of the mail.

Violated postal rules by knowingly and deliberately confiscating mail in his possession in the USPS vehicle instead of delivering it to my mailbox, handing it over to me in person only after I asked for it. Again, there were no events or conditions preventing delivery of the mail.

Violated postal rules by carrying mail into a building which is not the home or business address of a postal customer.

Clearly, one reason FedEx and United Parcel Service are beating USPS is that they don't coddle empoyees who engage in such frolics.

Posted by: C_DIVER | July 6, 2010 12:02 PM | Report abuse

The percentage of rates at which the cost of 1st class postage has risen since Ronald Reagan took office.

Ronald Reagan from 20 to 25 cents 25%
George H. Bush 25 to 29 cents 15.3%
Bill Clinton 29 to 34 cents 14.7%
George W. Bush 34 to 42 cents 19.1%
Barack Obama 42 to 44 cents 4.8%

Posted by: bstrauss0913 | July 6, 2010 10:15 AM | Report abuse

This sounds like a response bashing Republican Administrations. A couple of facts - Today's dollar was worth $1.99 in 1981 when Reagan took office after Carter was thankfully gone and the dollar was worth $1.53 in today's dollars in 1988 when the price of a first class stamp increased to 25 cents.

The average postal employee earned in the range of $24,173 in 1981 compared to an average of $75,000 today. This ranges from around $61,000 in San Antonio, $69,000 in Dallas and St Louis up to 89,000 in the Washington DC area.

The postal rate increase cannot be blamed on either Republican or Democrat administration but more on the way that the Post Office is operated which needs to go through a lot of changes and ran more like a business.

Posted by: sales7 | July 6, 2010 12:15 PM | Report abuse

I think the USPS should just get rip one supervisor for every office, the USPS just have too many managers and supervisors making too much money and doing nothing. The USPS will only survive by layoff management positions and improve services, no need to increase rates for stamp, rate increase will only force people to pay online. So hope the PMG get this massager.

Posted by: KenChen82 | July 6, 2010 12:15 PM | Report abuse

Why not stop Saturday mail delivery? Everyone has to cut back... To raise the price of a stamp will encourage people to pay their bills over the internet...

Posted by: akeegan2 | July 6, 2010 12:50 PM | Report abuse

The USPS will deliver a letter for 46 cents. Fedex and UPS charge what? About $20.00? Let's just abolish the "Government can't do anything right" money losing post office and let efficient "private enterprise" take care of us.

Posted by: scottilla | July 6, 2010 2:24 PM | Report abuse

T gree with C_Driver, the USPS employee should be FIRED, for ALL of the reason's that were stated, special with his attitude and the manner in which re represent's his employer and with him being a man, he was NO RESPECT, Let HIM GO USPS !!!

Posted by: onesugar | July 6, 2010 2:54 PM | Report abuse

T gree with C_Driver, the USPS employee should be FIRED, for ALL of the reason's that were stated, special with his attitude and the manner in which re represent's his employer and with him being a man, he was NO RESPECT, Let HIM GO USPS !!!

Posted by: onesugar | July 6, 2010 2:57 PM | Report abuse

T gree with C_Driver, the USPS employee should be FIRED, for ALL of the reason's that were stated, special with his attitude and the manner in which re represent's his employer and with him being a man, he was NO RESPECT, Let HIM GO USPS !!!

Posted by: onesugar | July 6, 2010 2:57 PM | Report abuse

Take the US Postal service private. Sell it off to the top bidder. Take the proceeds and pay down our government debt.

One American's opinion!

Posted by: RobMc1 | July 6, 2010 4:00 PM | Report abuse

Maybe the postal service should announce that they are ceasing opperations in six months. The public will have to find an alternative means of mailing stuff. All the employees will be laid off. Seporation packages will be provided as warranted. The private sector would move in to fill the gap incredibly fast. America would save a lot of money. Come on...these ideas are so easy!!!!! Our government is so dumb.

Posted by: RobMc1 | July 6, 2010 4:12 PM | Report abuse

It is a total waste as the US Postal Service has NO PLAN WHATSOEVER to fix their billion dollar holes so we are simply adding to the problem by paying more yet solving nothing

Huh?

Posted by: Bious | July 6, 2010 6:34 PM | Report abuse

Man oh! Man!!!! I just read through these posts and I thought I either moved to some third world country, or Romper Room just had a recess!

@ onesugar... please learn how to use you browser, spelling, English and character.

@ KenChen82... Hmmmmm. massager? Did you close your eyes while you wrote your post?

C'mon people. This is embarrassing!

That said. I think the suggestions are ridiculous. And the Post Office ALREADY is run like a business. That is why they are in the red and must raise their fees. I don't like it anymore than most of you... but if it is necessary, then so be it! You don't like it... stop using the USPS and pay the triple-fee with one of the private companies.

Posted by: darbyohara | July 7, 2010 6:56 AM | Report abuse

USPS cannot be privatized - Article I, Section 8 [7] U.S. Constitution, "To establish Post Offices and post roads."

Posted by: a_fed_at_home | July 7, 2010 12:25 PM | Report abuse

The comments to this entry are closed.

 
 
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