USPS Back To Back Defaults
The United States Postal Service will be forced to once again default on its debt. The USPS missed a $5.5 billion dollar payment just last month. The amount of the current debt is $5.6 billion and is due this Sunday.
The USPS is forced to make payments into a fund for the health benefits for future retirees. According to Postmaster General Paul Donahoe the Postal Service was required by Congress in 2006 to make such payments, reports the Wall Street Journal.
“Comprehensive reform of the laws governing the Postal Service is urgently needed in order for the Postal Service to…return to long-term financial stability,” the agency said in a statement. “Absent legislative action, the Postal Service is unable to make a scheduled $5.6 billion payment to the U.S. Treasury.”
No other governmental office or agency is required to make the same payments.
The Postal Service is unlike other government agencies in that its day to day operations do not receive fund through tax dollars. Congress has control over its budget for operations and has final say over its expenditures.
The Postal Service has floated proposals that would reduce the number of post offices and limit delivery days. Each has been rejected by the postal unions.