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Postal Service announces $3.5 billion loss for third quarter

By Rachel Weiner

By The Post's Rachel Weiner

As expected, the U.S. Postal Service announced bad news Thursday: It ended the third quarter of fiscal year 2010 (April 1 – June 30) with a net loss of $3.5 billion, compared with a net loss of $2.4 billion for the same quarter last year.

Third-quarter mail volume totaled 40.9 billion pieces – down approximately 700 million pieces, or 1.7 percent, compared to a year ago.

The service cited "unprecedented" decline in mail volume and higher benefits and pay.

“Given current trends, we will not be able to pay all 2011 obligations,” said Joseph R. Corbett, the Postal Service’s Chief Financial Officer. “Despite ongoing aggressive cost reductions totaling over $10 billion in the last three years, it is clear that a liquidity problem is looming and must be addressed through fundamental changes requiring legislation and changes to contracts.”

By Rachel Weiner  | August 5, 2010; 10:45 AM ET
Categories:  Agencies and Departments  
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Comments

It's going to take a lot more than just showing up at the ballot box to fundamentally cure the malignant sickness in this nation.

The government is a serial rapist.

Posted by: HostileKnowledge | August 5, 2010 1:24 PM | Report abuse

of senator jim (free market) demint a former direct mail company owner and his buddies in congress did not force the usps to subsidize junk mail with first class revenues then the usps would not be in such trouble. just today i received 3/4 lb of unsolicited mail from grocery stores, department stores, etc. and none of it was sent at first class rates. usps has to make up for the loss on every piece of junk mail, catalogues, etc. by continually raising first class rates. too bad "free market" demint does not practice what he preaches in forcing this multibillion dollar subsidy on the usps, and its first class customers.

Posted by: george32 | August 5, 2010 3:27 PM | Report abuse

The enterprise model for government is a failure. On the one hand, you tell the agency to operate on a for-profit basis. On the other hand, you saddle it with mandates that make profitability impossible.

The post office must deliver mail anywhere in the US for the same price no matter the distance. A DC-Baltimore letter costs the same as DC-Honolulu. Rural service costs a lot more than urban to cover per person, yet the post office cannot bill rural customers more.

Then Congress meddles with mandates like forcing USPS to carry junk mail at a discounted rate.

Meanwhile, UPS and Fedex are free to adjust their operations based on profitability, not politics.

If Amtrak built services based on rider demand and not congressional demand, it could be profitable as well.

Either unshackle these enterprises from restrictive mandates or relieve them of their profit motive.

Posted by: AxelDC | August 5, 2010 3:37 PM | Report abuse

Time to cut residential mail deliver to 3 or 4 times a week. I only get "real" mail once a week; all the rest of the days it's junk mail addressed to resident or not addressed at all. It hasn't been safe for me to send or receive important documents through my local post office for over 15 years -- local post office keeps losing mail, Philadelphia central keeps shredding mail, and the Postmaster General won't do a thing.

Posted by: ccs53 | August 5, 2010 4:27 PM | Report abuse

It's long past the time to turn over the postal service to a private company like UPS or FedEX the people who know how to deliever and make a profit.The federal government has proven for many years that they can't run anything efficiently,they are experts at wasting money but haven't a clue about how to run a business.

Posted by: LDTRPT25 | August 5, 2010 5:05 PM | Report abuse

End the subsidies on junk mail, nonprofits, and other beneficiaries, if for no other reason than they are wasteful, they can spam like everyone else. Set the post office free to set its own rates, other than that first class rates have to be uniform. Then stop the talk about cutting back on service. God, as a middle class person, I get little or no benefit from the programs my taxes pay for, let's cover the USPS's deficit and keep this government service running at full strength. No one is talking about going back to 1882, when the post office delivered in cities five times a day, but once, six days a week does not seem so terrible.

Posted by: Nemo24601 | August 5, 2010 5:27 PM | Report abuse

I really can't remember the last time I got anything of substance in the mail. Every day is just another delivery of trash that needs to be shredded. They should stop calling it the Postal Service and start calling it the Trash Delivery Service. This isn't the Post Office's fault, of course.

Posted by: pswift00 | August 5, 2010 5:35 PM | Report abuse

When Congress passed Postal Reform Legislation a few yrs ago, USPS was doomed. Congress it its infinite wisdom, restricted USPS to rate increases that matched the general cost of living. Problem there is that Postal expenses, such as fuel and labor related costs went up much more than the general cost of living. When the economy went south, mail volume dropped, but many of the costs didn't decrease as much as the mail volume. USPS is locked ina death spiral unless Congress allows USPS the latitude to control its costs.

Posted by: almelbe | August 5, 2010 5:47 PM | Report abuse

What a pathetic country we have become when our own government cheats its citizens wholesale.I have a small business and USED to use the USPS almost exclusively.But now,almost every package is "overweight or oversized" warrenting extra $$.Now I ship by UPS and the saving is significant.

Posted by: hyroller56 | August 5, 2010 8:06 PM | Report abuse

Yes, we can abolish the Post Office, and pay Fedex or UPS (the people who know how to make a profit) $20 to mail a letter. And while we're at it, when was the last time the Interstate Highway System made a profit? Time to turn it over to the private sector where they know how to make a profit. And the Army, and the schools, and Social Security, where all those banks and insurance companies make a profit. And keep the government out of my Medicare!

Posted by: scottilla | August 6, 2010 9:23 AM | Report abuse

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