The Feds Mandate That the US Postal Service Lose Money

❝ For the first three months of 2018, the US Postal Service reported a $1.3 billion loss, up from $562 million a year ago.

The basic issue is that revenue is growing more slowly than expenses. Total revenue grew by 1.4% while total expenses grew by 5.7%. Clearly, that makes for a less profitable business. This is a government-mandated financial squeeze and there are two main causes.

❝ First, regular mail—that is, the ordinary letters sent by individuals and businesses on a daily basis—is a declining business; volume-per-end-point (the mailbox) declined by 3.4% this year. Overall, regular mail is down 35% over the past 10 years. The problem is that the cost to deliver doesn’t decline with lower volume…

❝ Second, retirement expenses are growing significantly. Retiree health benefits increased 60% since last year and unfunded retirement benefits increased a whopping 142%…

RTFA. After all, there is some good news. Mostly from doing business with folks like Amazon.

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