US Post Office losing billions each quarter and continuing losses.
Interesting question. And this is not something that is a short term situation. They have been losing billions every quarter. Their 3rd quarter, which is the April to June period, results in a loss of $5.2 billion. And the tax payers are going to be on the hook for that money. While the Post Office must be in business to deliver the mail across the country, this kind of a loss is rather significant and one which cannot continue to occur. In the previous quarter, they lost in the billions as well and there appears to be no end in sight.
If this was a privately held company which continued to sustain these kinds of losses over many years, they would no longer be in business. But the US Government continues to prop up the USPS to continue providing services. And part of the problem is the US Government. The USPS wants to eliminate Saturday delivery services which is very costly for them in a cost cutting move. But, they cannot do that without the approval of Congress. And it does not look like they are going to get that approval any time soon while daily losses continue to climb.
Retirement costs are also plaguing them as well as health benefit cost rising. The biggest problem is that the Post Office has not responded to changing technology. With the growth of email in the 1990′s, they knew what was coming, but did not make any changes to try and leverage the changing technology to their advantage. And that is mainly because of the US Government regulations.
In a famous episode of Jerry Sienfield, Kramer attempts to cancel his mail. All of it as he has other ways of getting his bills and communicating with other people. He wants to stop receiving mail period. And that is the reality of today society. The importance of getting mail from the Post Office is greatly diminished as we all use Bill Pay and do not receive paper copies of bills. Instead we get them by email.
The Post Office needs to branch into some other areas as a way to return to profitability.