Salvation Hidden in Plain Sight
Just when it looks like the U.S. Postal Service is gonna remain perpetually insolvent and people are pulling out their hair about what to do about it, the USPS Inspector General comes out with a report saying the USPS overpaid its Civil Service Retirement System pension obligations for retired employees by $75 billion over nearly 40 years.
That’s $75 billion with a B.
In its report, the Inspector General’s office outlined how between 1972 and last year, the USPS was overcharged $75 billion to pay for the pensions of retirees before 1971 when the U.S. Post Office was still a government agency and recommended this money be returned to the USPS to pay for both pensions and health care costs. To view report, click here at www.usps.oig.gov.
Of course it will probably require an act of Congress before the USPS sees a dime of this money.
It’s this latter issue of healthcare costs that’s been a millstone around the USPS’s neck ever since enactment of the Postal Accountability and Enhancement Act of 2006. This law, which otherwise reformed the postal service, also mandated the USPS every year cough up a $5.4 billion prepayment for retiree healthcare expenditures.
Yeah, the USPS got a bit of a break a few months ago when that $5.4 billion payment was reduced to $1.4 billion and terms were renegotiated for the next year.
Every day it seems we’re bombarded with rhetoric about how the USPS can’t keep itself going and has to resort to things like closing local post offices around the country, reducing delivery dates and taking other dire measures to keep operating what’s probably the only government institution everybody still trusts and which is still the direct marketing industry’s main form of communication and commerce.
And there are some good indications direct mail is gonna be staging a slow-but-steady comeback this year after suffering a slump in 2009 like much of the rest of the overall economy.
So the big question remains: why the hell did nobody point out this overpayment before the USPS and Postmaster General Jack Potter had to go scrounging for means to save money to keep the postal service in business?
