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Congress Destroying US Post Office System

For people who claim to love the Constitution, the Republicans in Congress sure have a hard time adhering to it.

The Republicans' latest assault on the Constitution involves a sinister plot to defund the Post Office and hand over the Constitutionally mandated postal service to a private firm, such as Federal Express (NYSE: FDX) or UPS (NYSE: UPS). The claim is that the Post Office loses billions of dollars per year, and that privatizing the entire postal system would reduce inefficiencies and save taxpayers billions per year.

Unfortunately, that claim is bunk. Hogwash. Poppycock. Total and utter crap...and the Republicans know it.

The claims from Republicans in Congress, specifically Darrell Issa of California, are that the US Postal Service is insolvent, bankrupt, and cannot dig itself out of a hole. A closer look at the facts around the financing and funding of the Post Office shows that Issa is, to put it charitably, a damned liar.

First off, we know for a fact that the Post Office is, on paper, $20 billion in the red for the last four years. If we stop there, which is where Issa would have you stop thinking, it seems bad for the Post Office. No one can operate a business, even a government-run one, and lose money every year.

BUT, and this is a big but, that is not the entire story. The story lies in the question of "How did the Post Office lose $20 billion?" The answer is simple: the government stole $21 billion from the Post Office. Yes, really.

How did the government steal $20 billion from the Post Office? The way government always steals money — they got Congress to just take the Post Office's money. Here's how it worked. Every year, large businesses and government departments have to set aside a portion of their money to cover future retirement expenses, specifically pensions. That money is set aside to pay for the retirement of current employees.

In 2006, Congress decided that the Postal Service — and only the Postal Service — would have to change the way it funds its health care and pension plans. While a normal business might sock away some money to pay its future obligations, most do not. They rely on future receipts, which, given the nature of retirement plans, makes good sense. Congress required the Postal Service to fully fund its plan in advance, taking billions out of its current operating revenue.

Did you catch that? The government stole $21 billion from the Post Office, and then wants to close down the Post Office for being $20 billion in debt. Have you ever heard of anything more ridiculous in your life? The Post Office isn't in debt and it isn't operating in the red. If the government didn't steal $21 billion, the Post Office would be just fine. It's an accounting error, for chrissakes.

Imagine you and your family pulled in $100,000 a year. You might live off a chunk of that, pay your bills with some, stick some in a savings account, pay off college debt, pay down your mortgage, et cetera. In addition, if you're smart, you'd stick a portion of that into a retirement account of some kind. Congress had the Postal Service stick all its money into the retirement account, and then complained that the Postal Service didn't have enough money to pay for the house, kids, cars, and so forth.

Yet this nonsensical accounting move hasn't stopped the Republicans in Congress from their one, true goal: destroy and then privatize the Postal Service. That's what all this fake accounting is about.

You can check for yourself. The bill is in the House of Representatives, and is called HR 2309. It is supposed to "save" the Postal Service, but like just about anything else this Congress does, it has the opposite effect. The bill, if passed, will destroy the Postal Service. How bad would things be, if the HR 2309 passes?

  • The bill would eliminate home door delivery service for 90 percent of Americans. Yes, 90 percent.
  • End Saturday mail delivery, which would hurt small businesses and seniors who rely on the mail for their prescription medications.
  • Destroy another 200,000 jobs — many of which go to US war veterans — and replace them with private company jobs, which do not offer benefits for veterans.
  • CLOSE THOUSANDS OF POST OFFICES across America, sending rural Americans back to the 1850s and some sort of Pony Express...if they can get service at all.

The best part is, the bill would do all of this without actually fixing the problem — which is that Congress stole $21 billion from the Postal Service. You just can't make this stuff up. These people are insane.

Not to worry. One Congressman has stepped up and introduced a different bill. Representative Stephen Lynch (of course, a Democrat from Massachusetts) introduced H.R. 1351, the United States Postal Service's Pension Obligation Recalculation and Restoration Act of 2011. This bill would fix the decades-old tradition of looting and overcharging the Postal Service for its retirement plans, as well as stop Congress from stealing the Postal Service's money. It would balance the books properly, and allow the Postal Service to implement the remainder of their sensible streamlining changes, without destroying the entire system.

So these are our choices, America. The Republican bill would kill the post office and let private companies come in and do for mail delivery what private companies have done for public services everywhere — provide terrible, monopolizing services, cut jobs, cut wages, and hike prices.

Or, we can do the smart thing (really, the no-brainer approach) and fix the accounting error, stop stealing money from the Postal Service, and let these civil servants to continue to do the job that the Founding Fathers laid out for them: deliver the mail for the American People.

I don't care how much of a Republican fan boy you are — no rational person can look at this situation and see a reasonable outcome is the Republican plan. Closing down thousands of post offices? Ending home delivery? Whatever Karl Rove has those boys smoking, I want an ounce or two...delivered on Saturday, if that's still possible.

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To comment on this (or any of my columns), visit my user page at Benzinga. You can also reach me by email john@benzinga.com or on twitter @johndthorpe.

Posted-In: Congress Morons US Post OfficeNews Movers & Shakers Politics Legal General Best of Benzinga

 

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