Direct from USPS Quotes
Over the last week there have been multiple articles concerning the financial status of the USPS. As quoted “Steiner told Reuters in December that the agency has a “precarious cash position,” adding that at current spending rates, “we’re basically out of cash in early 2027.”
The U.S. Postal Service (USPS) has issued an urgent warning to Congress, stating that it faces a “severe financial crisis” and could exhaust its cash reserves in less than a year. PMG Steiner laid out some proposed measures.
- Rates: To avoid total collapse by early 2027, Steiner noted that the price of a stamp today at $0.78 is far below many other countries and perhaps should be over $1.00.
- Delivery Costs: eliminating Saturday mail delivery and shuttering various postal facilities. “Steiner said reducing deliveries to five days a week would save USPS about $3 billion a year, while closing small post offices in remote areas would save $840 million.” This one would face opposition from much of Congress.
- Legislative Requests: The USPS is asking Congress to lift the decades-old $15 billion borrowing cap to provide a liquidity bridge while the agency attempts deeper structural restructuring. They believe that an increase to $30 billion is necessary to meet immediate needs.
Source articles
From the Union
The American Postal Workers Union (APWU) which represents over 200,000 USPS employees and retirees published in their March/April magazine an article on how the postal services financial woes do not stem from Market Forces alone. Much of the article is based on analysis by former Postal Board Governor Roman Martinez, who argues that the U.S. Postal Service’s financial crisis is primarily caused by restrictive congressional mandates rather than just a decline in mail volume. The summary of the article’s key points includes:
- External Factors Drive Losses
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- In fiscal year 2025, over 70% of USPS losses were attributed to factors outside the agency’s control, accumulating over $100 billion in recurring losses, largely due to what they perceive as legislative constraints.
- Outdated Borrowing Limits
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- The USPS is barred from traditional credit markets and is limited to a $15 billion debt cap set in 1991. Adjusted for inflation, this limit should be over $30 billion.
- Investment Restrictions on Pensions
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- Current law mandates that USPS pension and retiree health funds be invested solely in Treasury debt. An OIG report stated that if the USPS had been allowed to invest in a traditional portfolio (like Amtrak or the Tennessee Valley Authority), these funds would have an $800 billion surplus instead of a $100 billion deficit.
- Unfair Pension Funding Burdens
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- The USPS is still burdened by pension costs for employees who worked for the old Post Office Department prior to 1970, correcting this “payment mandate” could generate a $95 billion surplus, per an OIG report, which would extend the life of retiree health benefit funds by more than 20 years.
