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casinterest
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Posts: 7484
Joined: Sat Feb 12, 2005 5:30 am

Treasury Department Post Office Recommendations

Tue Dec 04, 2018 9:30 pm

We have followed the animosity between Trump and Bezos in regards to the rates Amazon pays to ship products through the US postal service. In response to all of the threats the Treasury department under the lead of the incredibly capitalistic wasteful spender Steven Mnuchin has produced the below gem of a document.

https://home.treasury.gov/system/files/ ... 4-2018.pdf

From which we have these two gems of statements.

"The current business model caps price increases for mail products at the consumer price
index for all urban customers (CPI-U). This rate cap, similar to those placed on other
monopoly utilities, was established in order to enforce cost discipline on the USPS and to
protect captive customers at a time when volumes were near their historical peak and the
mail monopoly was still effective in producing revenues. However, given that the USPS has
passed the historic inflection point and volumes and revenues are in persistent decline, the
concept of an across-the-board rate cap is less necessary to constrain predatory pricing and is
inconsistent with a sustainable postal system. "

"The Task Force recommends that the USPS be required to price any mail not deemed to be
an essential service at a market rate in order to generate income that would fund the USO,
capital expenditures, and other long-term liabilities. The USPS should incorporate minimum
“essential” package services into the definition of the USO, such as for the delivery of
pharmaceuticals and non-commercial, person-to-person packages. Redefining the mandate
for USPS package delivery business will provide a funding mechanism for the USO. "



So basically the Treasury is telling the post service to raise prices to market rates in competitive markets in order to further drop their volume of mail, and require subsidies from the federal government to continue to provide USO (Universal Service Obligation:Rural and low density markets with HIGH Costs) .


The Treasury department should examine the airline industry and realize that it is not in the interest of the federal government to attempt to compete with private industry when it comes to providing mail service between high density (cities) locations , while trying to fund rural service. The private companies will not care, and the costs for city dwellers will be less than rural dwellers, and industries will vacate rural areas for cheaper areas (cities) that provide better shipping options.

I think Trump , Mnuchin, and their disciples are on pace to destroy rural america and make it even more remote.

What do you all think .
Older than I just was ,and younger than I will soo be.
 
LittleFokker
Posts: 1037
Joined: Sat Sep 28, 2013 10:25 pm

Re: Treasury Department Post Office Recommendations

Tue Dec 04, 2018 9:39 pm

Utter crap. The easiest fix to make the USPS solvent is to reduce that terrible rule signed by W Bush that forces the USPS to pre-fund all pensions 75 years in advance (including those who the organization hasn't even hired yet). That law was designed to specifically cripple the Post Office by making it seem like they were losing money every single year by holding them to a standard that literally no other organization public or private is held to.

Do away with that bullshit and then we can talk about whether or not rate increases are necessary.
"All human activities are doomed to failure." - Jean Paul Sartre
 
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casinterest
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Re: Treasury Department Post Office Recommendations

Tue Dec 04, 2018 9:46 pm

LittleFokker wrote:
Utter crap. The easiest fix to make the USPS solvent is to reduce that terrible rule signed by W Bush that forces the USPS to pre-fund all pensions 75 years in advance (including those who the organization hasn't even hired yet). That law was designed to specifically cripple the Post Office by making it seem like they were losing money every single year by holding them to a standard that literally no other organization public or private is held to.

Do away with that bullshit and then we can talk about whether or not rate increases are necessary.


But that doesn't fix it either. The USPS is a federal service, and one that has federal benefits for it's workers and Federal Requirements for it's operations. The USPS cannot compete against private companies with less regulations in Urban markets. The pricing caps that the Feds wan't to lift would make the market accessible for private competitors, and it would further exacerbate the federal deficit for the post office. The Post office is not a private company, it is a Federal service, and trying to run it like a private company does not work, as it has USO that must be met, that no sane private company would attempt to meet. The private companies will compete where it is profitable further driving up the losses for the USO mandated services to rural areas.
Older than I just was ,and younger than I will soo be.
 
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trpmb6
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Re: Treasury Department Post Office Recommendations

Tue Dec 04, 2018 9:49 pm

So what you're saying is private industry is better suited to providing services.
 
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casinterest
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Re: Treasury Department Post Office Recommendations

Tue Dec 04, 2018 9:55 pm

trpmb6 wrote:
So what you're saying is private industry is better suited to providing services.

In dense markets, without requiring retirement benefits, and meeting federal requirement for service availability yes. But the US government is not private industry, and rural residents will not receive the same services if any from a private company.

Remember the USPS is one of those constitutionally defined functions of the government right? Why should we force them to compete at market prices with competitors who have no interest in serving rural markets?

Amazon uses the USPS because it is affordable. If the USPS competes at market prices in large markets , Amazon, Targtet will just use a competing provider or form their own distribution service( Have you seen those new contracted Amazon Prime delivery trucks in Rural America)?
Older than I just was ,and younger than I will soo be.
 
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trpmb6
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Re: Treasury Department Post Office Recommendations

Tue Dec 04, 2018 9:57 pm

casinterest wrote:
trpmb6 wrote:
So what you're saying is private industry is better suited to providing services.

In dense markets, without requiring retirement benefits, and meeting federal requirement for service availability yes. But the US government is not private industry, and rural residents will not receive the same services if any from a private company.

Remember the USPS is one of those constitutionally defined functions of the government right? Why should we force them to compete at market prices with competitors who have no interest in serving rural markets?

Amazon uses the USPS because it is affordable. If the USPS competes at market prices in large markets , Amazon, Targtet will just use a competing provider or form their own distribution service( Have you seen those new contracted Amazon Prime delivery trucks in Rural America)?



Oh I know, I'm just playing devil's advocate :) At least allow me to have this one moment to push your button :P

On a historical note, I've always found it interesting that the USPS was actually included in the constitution itself. I wonder, if the constitution would have been written in today's age, would things like internet service been included?
 
2122M
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Re: Treasury Department Post Office Recommendations

Tue Dec 04, 2018 10:05 pm

trpmb6 wrote:
So what you're saying is private industry is better suited to providing services.


I think what he's saying is that private industry is better at turning a profit since it can focus on certain markets and doesn't have to care about the entire population.
 
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casinterest
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Re: Treasury Department Post Office Recommendations

Tue Dec 04, 2018 10:46 pm

And check out what is happening to Fedex and UPS

https://www.cnn.com/2018/12/04/investin ... index.html
Older than I just was ,and younger than I will soo be.
 
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trpmb6
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Re: Treasury Department Post Office Recommendations

Tue Dec 04, 2018 10:53 pm

Kind of a twisted irony that the vary companies that help build Amazon (and benefited greatly themselves) will now find themselves at the whims of that company.
 
GalaxyFlyer
Posts: 1987
Joined: Fri Jan 01, 2016 4:44 am

Re: Treasury Department Post Office Recommendations

Wed Dec 05, 2018 1:46 am

LittleFokker wrote:
Utter crap. The easiest fix to make the USPS solvent is to reduce that terrible rule signed by W Bush that forces the USPS to pre-fund all pensions 75 years in advance (including those who the organization hasn't even hired yet). That law was designed to specifically cripple the Post Office by making it seem like they were losing money every single year by holding them to a standard that literally no other organization public or private is held to.

Do away with that bullshit and then we can talk about whether or not rate increases are necessary.


That is by the ERISA how private pensions are funded. It’s not pre-funded, it’s just that the USPS must put away enough money annually, allowing for investment returns, to pay for its expected pension and health costs. Businesses have required required to do that since 1974, though to be truthful, the regulators have given funding level waivers which resulted in underfunded pensions being foisted on the taxpayers thru the PBGC.

It’s not politics, it’s finances.

GF
 
Ken777
Posts: 9757
Joined: Thu Mar 11, 2004 5:39 am

Re: Treasury Department Post Office Recommendations

Wed Dec 05, 2018 2:23 am

trpmb6 wrote:
So what you're saying is private industry is better suited to providing services.


I can't remember the private sector performing better (in all areas) than the government.

At my age the first thing I look at is Medicare. There is Medicare Advantage from the private sector which was supposed to do a better job for less money. All they needed was a 15% override for a little while to help them get started. The Government is STILL paying that 15% "short term handout" - how long do you believe that it will continue". Is there any who believes the private sector does a better really believe that 15% handout will end.

I personally don't believe that we need private companies taking over government tasks, killing decent wages and benefits and adding more Americans to below poverty line wages. You as a customer/client/patient really don't benefit near as much as the Executive Suite who sucks up most of the savings. The VA Nursing Home In Michigan is a great example. The GOP Governor believed that private industry could do a 'better" (cheaper) job so he gave it to a private company. Wages went to poverty levels and good, long term employees left to jobs where the wage was equal to the experience and qualifications. Then the GOP didn't worry about the collapse of the care for those vets. No longer were meds delivered on timeline guy who had a feeding tube (because he needed out) had the tube pulled out because it was "too much effort" for the minimum wage employees. One vet was stopped and broke a leg or arm ad it took media exposure to get some action. The GPO Governor fired the appointed head of the State VA Programs, but not the people pulling in the extra profits as a for profit company.

When I read about this I kept wishing that Okie could have been sent to clean that situation - full authority to make it right under a government operation.
 
GalaxyFlyer
Posts: 1987
Joined: Fri Jan 01, 2016 4:44 am

Re: Treasury Department Post Office Recommendations

Wed Dec 05, 2018 2:46 am

Who’s to blame, the private insurer or the government who keeps paying the 15% override? Look, do you think Musk is lobbying to end the $7,500 electric car subsidy? Hell, no, he’s banking on every Tesla by soaking rich idiots who buy his cars as a fashion statement. The government never gets out of the subsidy business because lobbyists have more power than the general ill-informed public.


GF

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