Thursday, July 19, 2012

Postal Service once again fails to deliver a solvent business model

It's that bi-annual time again for the U.S. Postal Service to come before Congress and the American people to tell us how needed they are, and how without more bailout cash, your mail might not be delivered.

While lawmakers continue to fight over how to fix the ailing U.S. Postal Service, the agency's money problems are only growing worse.

The Postal Service repeated on Wednesday that without congressional action, it will default—a first in its long history, a spokesman said—on a legally required annual $5.5 billion payment, due Aug. 1, into a health-benefits fund for future retirees. Action in Congress isn't likely, as the House prepares to leave for its August recess.

The agency said a default on the payment, for 2011, wouldn't directly affect service or its ability to pay employees and suppliers. But "these ongoing liquidity issues unnecessarily undermine confidence in the viability of the Postal Service among our customers," said spokesman David Partenheimer.

The agency says it will default on its 2012 retiree health payment as well—also roughly $5.5 billion, due Sept. 30—if there is no legislative action by then. - Wall Street Journal via Zerohedge

However, don't expect too much from Congress.  As the vastly intelligent progressive Harry Reid tells us...


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