You hear all the time how the USPS is broke….a burden on the taxpayer etc, but most people do not understand the role that Congress has played in all of that.  That’s not to say that the USPS is totally without blame; it is to say however – that those in Congress who wish only to see private businesses provide services are trying very hard to cut the legs from underneath an institution that has provided real value to Americans since before the Constitution – 1775.  And despite the need to innovate thanks to disruptive technologies like the internet – Congress will not let them.  Instead – the hang the USPS up on a tree and bat it around in front of a big crowd using it as an example for all of America’s government woes.

The NY Times has the story:

The Postal Service in 2000 began operating a secure system that would have allowed it to remain the primary conduit for most Americans’ monthly payments. But the Internet industry objected, and Congress successfully pressured the Postal Service to abandon it. The same pattern has repeated several times over the last decade, with the Postal Service identifying a way to cope with the decline of traditional mail, only to have companies — and ultimately Congress — object. The agency’s troubles, which could result in the closing of thousands of post offices and hundreds of mail processing centers as early as next month, have many sources. Some are the inevitable result of technological changes, and others are the result of missteps by the Postal Service. But top Postal Service officials and outside experts say that another, underappreciated factor has been an insistence by Congress that the service not compete directly with private companies.

Rolling Stone adds:

In 2006, in what looks like an attempt to bust the Postal Workers’ Union, George Bush signed into law the Postal Accountability and Enhancement Act of 2006. This law required the Postal Service to pre-fund 100 percent of its entire future obligations for 75 years of health benefits to its employees – and not only do it, but do it within ten years. No other organization, public or private, has to pre-fund 100 percent of its future health benefits.

“No one prefunds at more than 30 percent,” Anthony Vegliante, the U.S. Postal Service’s executive vice president, told reporters last year.

The new law forced the postal service to come up with about $5.5 billion a year for the ten years following the bill’s passage. In 2006, before those payments kicked in, the USPS generated a small profit. Not surprisingly, the USPS is now basically broke.

The 2006 law also bars the Postal Service from offering “nonpostal services,” which means the USPS can’t, say, open up a bank, or an internet cafe, or come up with any new entrepreneurial ideas to generate new income, as postal services do in other countries.

Going Postal has this great chart from the Washington Times HERE:

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