The Postal Service is continuing to hemorrhage money, reporting a loss Tuesday of more than $2 billion over the first three months of the year and warning it could be forced to default on federal payments.
Such a default would not interrupt mail service to millions of Americans, but it could further hobble an agency struggling with a sharp decline in mail because of the Internet and a tough economy.
The agency says the $2.2 billion loss covers Jan. 1 to March 31, 2011 — sharply higher than the net loss of $1.6 billion for the same period last year. The post office also said it will have reached its borrowing limit, set by Congress, of $15 billion by the end of the fiscal year.
Unless Congress intervenes, the Postal Service said, the agency won’t have the cash for certain payment to the government, such as billions for a trust fund to provide health care benefits for future retirees.
And they want to run your health care, your retirement, and everything else. Confident? I’m not.
Seriously, though, this comes up from time to time and the interesting part is that the “pro postal service” folks will almost always argue that the Postal Service has restrictions placed upon it that won’t allow it to run at a deficit, as if that’s some kind of consolation, and that they’re an essential part of the United States even as fewer and fewer people use it.
I don’t know about you, but aside from Money Orders, I have no use for the post office whatsoever. I would love to pull a Kramer and opt out of the mail altogether.
The postal service brings up an interesting point, and one that I’ve made numerous times (and sometimes I feel like I’m making it into an empty room).
What happens when a private business venture isn’t good enough to survive?
Well, in the real world it fails, goes out of business, and goes away (unless of course the government has croneys to bailout such as unions, in which case the business is then deemed too big to fail and is bailed out). It’s called a market correction and it’s the core of how business works.
In the government world, however, businesses aren’t allowed to fail. No matter how unsustainable, unreliable, and antiquated, they’re kept, propped up, and funded. The more they fail, the more money that’s sunk into them, and eventually they become a bottomless pit of failure that lurches along and leeches money while being without value to the nation at large.
The Postal service is somewhat different in that it doesn’t receive direct tax payer funding, however in the past few years it has been borrowing money to counter the decreased reliance on the service itself. In a normal business, the company would have to default and shut down, but I promise you that won’t happen here. The government will bail out the Postal Service using your tax money, and the long-since-obsolete agency will continue to function in spite of its irrelevance.
That’s how the government runs a business.