USPS, deep in the red, has rate boost declined

A 5.6 % postal price boost requested by the United States Postal Service was turned down Thursday by the Postal Regulatory Commission. Among the proposed increases, the postal service said raising the price of a first class stamp from 44 cents to 46 cents was necessary because of reduced mail traffic during the economic recession. The commission did not agree with that reasoning. A bad business model, not the economy was the source of the problem, the commission said.

Help wanted by postal price raises

A deficit of $238 billion via 2020 is what is expected for the USPS meaning it is losing all its money. In addition to the first class stamp price increase, Bloomberg reports the USPS requested an increase of 7 % on packages used to ship books, video and merchandise. It also hopes to get a rise on parcels under a pound. It is hoping that it will go up 23 %. The Postal Service hasn’t increased its rates in about two years. For the first time since 1863, the Postal Service has requested to end Saturday postal mail delivery from Congress.

United States Mail needs to work out some difficulties

Thurs the House passed a bill that the senate passed Wednesday that funds federal programs via the beginning of December although the USPS wasn’t a part of it. Based on the Washington Post, the Postal Service owes a $5.5 billion payment that is required to pre-fund retiree medical benefits by law. Democrats tried to postpone this payment but Republicans wouldn’t have it. The USPS has slashed a $10 billion in expending. This cut has only been since 2008. Attrition is part of its plan. That’s how it wants to cut the workforce. The USPS and Congress are working together to come up with a plan to keep postal mail service alive and well, reports the Office of Management and Spending budget.

The main reason there could be no Postal Rate increase

The USPS lost $3.8 billion in 2009. Based on the Associated Press, the proposal wasn’t rejected as much as the presentation of the suggestion was, claims Ruth Goldway. Goldway is the chairman of the commission. The price boost was something she said at a news conference that had to change because of structural difficulties that need to be addressed instead of the economic recession hurting it. The Affordable Mail alliance fought with numerous others to reject this. The others involved were banks, national retailers, utilities, charities, smaller businesses and some consumer groups that got together.

Articles cited

Bloomberg

bloomberg.com/news/2010-09-30/u-s-postal-service-denied-another-rate-increase-by-regulatory-commission.html

Washington Post

washingtonpost.com/wp-dyn/content/article/2010/09/29/AR2010092906645.html?wpisrc=nl_pmheadline

Associated Press

google.com/hostednews/ap/article/ALeqM5iqbZ05-vr6nAfjJzyIXr_d1k26DwD9IIDJ4O0?docId=D9IIDJ4O0