Postal Service Faces Gloom Of Economy

Dozens of retired mailboxes sit in San Francisco i i

Dozens of retired mailboxes sit in a parking lot at the U.S. Post Office sort center March 25, 2009 in San Francisco, Calif. Postmaster General John Potter told the House Oversight post office subcommittee that the U.S. Postal Service will run out of money this year unless they are permitted to cut mail delivery to five days a week and are able to implement changes in how they payout retiree health care. Justin Sullivan/Getty Images hide caption

itoggle caption Justin Sullivan/Getty Images
Dozens of retired mailboxes sit in San Francisco

Dozens of retired mailboxes sit in a parking lot at the U.S. Post Office sort center March 25, 2009 in San Francisco, Calif. Postmaster General John Potter told the House Oversight post office subcommittee that the U.S. Postal Service will run out of money this year unless they are permitted to cut mail delivery to five days a week and are able to implement changes in how they payout retiree health care.

Justin Sullivan/Getty Images

The U.S. Postal Service announced Wednesday that it lost $2.4 billion between April and June. It's on track to be $7 billion in debt by the end of September.

"What has occurred with the economy is unprecedented," Postmaster General John Potter said. "It's created, obviously, a much bigger challenge than we are able to respond to in a very quick manner."

Potter is appearing before a Senate panel Thursday to talk about the financial troubles.

Lawmakers have urged the Postal Service to make hard choices. But truth be told, lawmakers, not the Postal Service, have been the ones dragging their feet.

"This is a mixed message that we're sending," Sen. Tom Carper (D-DE) said.

While Carper has urged the Postal Service to act like a business and come up with its own solutions, the senator won't sign on to the biggest structural change the Postal Service wants: permission to end Saturday delivery.

"I'm not sure it's something they ought to do, but it's got to be on the table," Carper said. "For a long time in this country, we delivered mail six days a week. For a lot of people, that's an important thing to do."

Eliminating Saturday delivery would still leave a sizable deficit, and other solutions would probably be necessary. For his part, Carper wants to ease a law that requires the agency to pre-pay benefits for future retirees.

Again and again, the challenge is the same. Lawmakers can seem supportive of cost-cutting measures — only less so if their constituents are affected.

At a hearing last week, Eleanor Holmes Norton, Washington, D.C.'s delegate to the House, slammed the Postal Service for not doing enough.

"I don't know what is pending here except collapse," Norton said. "I don't hear that there is a right-sizing plan of any kind that the Postal Service is engaged in."

Norton asked, "Are there any post offices in the District of Columbia, postal stations, under review for closing? ... That's something any member ought to be able to ask and get an answer to."

As the Postal Service navigates Congress, it has already been cutting its work force through attrition, consolidating mail routes and offering early retirements. But everyone knows that's not enough.

"Most members of Congress are in denial," said Rep. Stephen Lynch (D-MA), who is chairman of the House subcommittee overseeing the Postal Service. Lynch once opposed cutting back delivery to five days.

"I don't welcome it," Lynch said. "But I don't see any other options out there in terms of the ability to bring down costs."

Plenty of lawmakers say, however, that they will stand in the Postal Service's way.

"I am on my 14th annual farm tour," Rep. Jo Ann Emerson (R-MO) said. "There's no doubt that the decision makers at the Postal Service — I don't believe they have any clue of what it's like in small-town America."

Emerson added that plenty of senior citizens in Missouri don't have their checks direct-deposited. And if their Social Security checks are available on a Saturday, they want them delivered on Saturday.

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