TPA Reacts to More Financial Losses at the USPSMichi Iljazi on August 09, 2016
WASHINGTON, D.C. – Today, the U.S. Postal Service announced that it has lost $1.6 billion in the last three months. The Taxpayers Protection Alliance (TPA) continues to be disappointed at the persistent inability by the U.S. Postal Service (USPS) to institute the changes needed to operate in a profitable manner. This loss marks $3.29 billion in losses in the current fiscal year and brings them to $40 billion in losses since 2011.
It is clear to TPA that the growing debt is due to the financial mismanagement coming from the USPS’s troubled leadership. David Williams, President of the Taxpayers Protection Alliance noted that, “put simply, postal leadership fails to account for costs when determining what new business ventures to operate in. USPS management enjoys touting how much their package deliveries have increased and which new specialty delivery programs they have initiated, but the more services they provide the greater their debt has mounted. This is an obvious sign of poor management.”
During today’s earnings call, U.S. Postal Service Postmaster General attributed the poor financial showing to the recent expiration of a temporary rate increase called the exigent surcharge. This rate increase was intended to provide a $4 billion cash infusion over two years at the expense to postal customers. Despite the intent that this surcharge was temporary, the USPS came to depend on this bailout and has asked that it be made permanent. Because this rate increase was applied to profitable products that lack market competition, an extension can only be perceived as nothing less than a bailout of a financially mismanaged government entity.
“The USPS needs to focus on its core service of providing reliable and timely letter mail delivery service at an affordable rate instead of expanding into unproven and unprofitable service sectors that are driving its debt,” said TPA President David Williams. Postal reform must provide structural reform that puts the U.S. Postal Service on a path towards financial sustainability.”
The U.S. Postal Service just recently celebrated their 241st birthday and is showing their age because the focus of today’s USPS differs greatly from their original core mission of letter mail delivery, which many American’s still depend on.
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