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U.S. Postal Service finances remain wobbly

May 28, 2013 at 8:05 AM   |   Comments

WASHINGTON, May 28 (UPI) -- Two lawmakers -- an independent and a Democrat -- are sponsoring bills to eliminate a financial mandate that some say is threatening the U.S. Postal Service.

U.S. Sen. Bernie Sanders, Ind-Vt., and U.S. Rep. Peter A. Defazio, D-Ore., are attempting to reverse a mandate passed into law in 2006 that requires the Postal Service to pay billions of dollars in retirement healthcare costs 50 years in advance.

The Postal Service lost $5.6 billion the year the mandate began, $5.1 billion of which was due to the pre-payment requirement, the Los Angeles Times reported Tuesday.

With the Internet stealing business from the agency and with the funding mandate in place, the Postal Service is losing $25 million each day, which added up to a $1.9 billion loss in the first quarter of the year and a loss of $15.9 billion in all of 2012, the newspaper said.

The service is a business that is controlled by Congress. As such, lawmakers are aiming to change the fundamental structure of the relationship between the service and Congress to give it more flexibility on how it runs its operation.

With the current set up, proposals that would have saved the service $6.5 billion a year and efforts to consolidate have been shot down by Congress.

"The Postal Service has far too little flexibility when it needs to adjust and it's really in handcuffs because of all the requirements Congress puts on it," said Mike Schuyler, an expert on the Postal Service at the Tax Foundation, a Washington think tank.

The 238-year-old agency has survived other technological advancements in communication, including the telegram, the telephone and the television but the current crisis is considered dire.

"We are in real trouble, and we need comprehensive postal reform yesterday," Mickey Barnett, the chairman of the service's board of governors, told a congressional panel in April.

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