Looks like Dennis Ross has a problem with facts. When a commenter on his Facebook page mentioned our article criticizing a Washington Post story for ignoring the $50 billion the USPS has (involuntarily) stashed away for future retiree benefits, Ross responded “The other "trust fund" is just pure fantasy.” But then admitted “Yes, there is over $40 billion already in the fund.” Oh. OK. I guess when you’re a Congressman reality and fantasy don’t mean the same things as they do to the rest of us!

Ross also wrote, without providing any specifics, that “the amount of misinformation coming from postalnewsblog is staggering over the past few months”. Considering the source, we’ll take that as a compliment!

But let’s make one thing clear- unlike the Congressman, we deal in facts, not fantasies. And these are the facts:

• Between the “mythical” trust fund with its very real $42.5 billion, and the undisputed $6.9 billion FERS overpayment, the supposedly “insolvent” USPS effectively has almost $50 billion in the bank.
• The trust fund payments are the cause of the USPS losses since 2006. Without them, the USPS would have been profitable over that time period. All of the current USPS debt is money it has had to borrow from the Treasury so that it can then loan it back to the Treasury for the “trust fund”. It’s a shell game designed to take “off budget” postal revenues, and apply them to an “on budget” trust fund, artificially lowering the federal budget deficit.
• No other company or agency has the same obligation to prefund retiree benefits.
• Even if one accepts a need for some level of prefunding, the 2006 law was based on assumptions as to volume and workforce levels that no longer apply, yet no adjustments have been made to the payment levels.
• If the USPS had been allowed to run like a business since 2006 (i.e. without prefunding and Congressmen micro-managing its operations), it would be a profitable enterprise facing the recession with ample cash reserves.
• Republicans refuse to drop the accounting gimmick that places USPS operations “off budget”, while its retirement funds are “on budget” This allows them to cry “BAILOUT” if the USPS asks for some of its own money to be returned to fund its operations.
• Congress created the “crisis”, not the USPS unions or managers, and Congress needs to correct its mistakes before it destroys the US Postal Service.

via US Representative Dennis Ross.

WASHINGTON, Oct. 16, 2011 /PRNewswire-USNewswire/ — The National Association of Letter Carriers (NALC) today announced the retention of investment bank Lazard Group, LLC and former assistant to President Barack Obama for Manufacturing Policy, Ron Bloom, as financial advisors in connection with issues relating to the United States Postal Service (USPS).

Fredric V. Rolando, President of the NALC, announced the retention of its advisors to 1,500 regional and local NALC leaders gathered in a national conference to consider the current USPS financial crisis and the long-term strategic, structural and business challenges facing the USPS.

President Rolando issued the following statement:

"The nation’s letter carriers are committed to preserving six-day-a-week universal postal services to every address in every village, town and city of the nation. NALC and our financial advisors are prepared to work cooperatively with the USPS, the Congress, the White House and all other postal stakeholders and constituencies to resolve current cash flow and financial issues and develop a viable long-term, pro-growth business plan for the Postal Service.

Our efforts will be fact-based, non-political, non-ideological, and focused on the continued provision of universal service to the public and the preservation of hundreds of thousands of good middle-class jobs. We are confident that Lazard and Mr. Bloom-both of whom have extensive experience helping to revitalize numerous large and complex business enterprises around the world-can provide valuable assistance to all stakeholders who share our commitment to maintaining and growing this vital national resource."

The Postal Service is the hub of a $1.2 trillion mailing industry that employs eight million American workers centered on its unique ‘last-mile delivery network.’ NALC is currently engaged in collective bargaining with the USPS. The current five-year collective bargaining agreement expires on November 20, 2011.

via Letter Carriers Bring in Top Financial and Policy Experts to Advise upon Postal… — WASHINGTON, Oct. 16, 2011 /PRNewswire-USNewswire/ –.

From Ed Schultz last night on MSNBC:

msnbc video: Post Partisan.

The Daily Caller reports on today’s GAO report predictably (BAILOUT!), but it also provides a response from the National Association of Letter Carriers:

“The GAO is simply wrong in denying the overpayment, and in doing so it differs with the USPS, the Office of Inspector General (of the Postal Service,), the Postal Regulatory Commission, two independent actuaries, and legislators from both parties and both chambers of Congress who’ve addressed the issue in current legislation,” said the statement.

“It’s absurd to claim that the money owed the Postal Service would not solve its financial problems by asserting that they result from changes in consumer mail use and a business model weakness — given that over the past four fiscal years, despite the recession, mail delivery netted a $611 million operational profit. And saying that transferring the money would result in an increased liability is like a restaurant telling a consumer who was overcharged that refunding the overcharge would require taking the money from someone’s account. An overpayment needs to be refunded, period.

“Moreover, it’s ironic that the GAO is focused on soaking the USPS when the non-postal federal government, which includes the GAO has funded only 40 percent of its pensions, vs. 99 percent for the USPS.”

via USPS | GAO | Bailout | The Daily Caller.

Postmaster General Pat Donahoe spoke to employees at the Morgan Processing and Distribution Center in New York City last Monday- Mailhandlers Union Local 300 has posted a summary of the PMG’s remarks- among the highlights:

Under the USPS’s proposed service cutbacks, large mailers will still be able to get next day delivery by dropping their mail at 8AM, or noon if it’s presorted. Post offices would start receiving their mail at 4PM- sorting would happen overnight, carriers would pick up their mail in the morning and go directly to the street.

Donahoe doesn’t think Congress will allow USPS to leave CSRS, but says future retiree’s pensions should be capped, with no COLA. He doesn’t see any VERAs any time soon- but in a year or so, there’s possibility of $10-20K incentive, and/or 2 or 3 years service credits. He said that if the USPS is allowed to leave FEHBP, a USPS Health Plan would be operated by a contractor, not by the USPS itself.

Donahoe thinks the Carper bill is the best deal for USPS, and says he opposes privatization, and doesn’t think it will happen. He doesn’t think Congress would pass either the Issa or Lynch bills.

Donahoe expects flexibility similar to the APWU contract in the other unions’ contracts. He says negotiations with the Mailhandlers and Letter Carriers won’t be extended after November 20, but would go straight to arbitration if there’s no agreement.

PMGinNYC

Local 300 National Postal Mail Handlers Union.

WASHINGTON, Sept. 23 — The office of Sen. John McCain, R-Ariz., issued the following news release:

U.S. Senator John McCain (R-AZ) today introduced the Postal Reform Act of 2011, a bill to restore the financial health and long-term viability of the United States Postal Service. The Postal Service is expected to end this fiscal year with a $10 billion loss, and by its own estimates faces a shortfall of up to $238 billion by 2020. At the end of this month, the Postal Service will not be able to make a required $5.5 billion payment to fund future retirees’ health benefits. This legislation is needed to ensure that future generations of Americans will have a viable Postal Service. This bill is the Senate companion to the legislation introduced by Representative Darrell Issa (R-CA) in the U.S. House of Representatives this summer. Read the rest of this entry »

Darrell Issa, the self-appointed “watchdog” of the US Postal Service, today introduces new provisions in his so-called “reform” act that would reverse existing RIF rules, forcing the most senior postal workers to be laid off first. Issa’s bill had already included provisions throwing out collective bargaining rights, saddling the USPS with up to $10 billion in additional debt, and creating two new federal bureaucracies to “oversee” the USPS.

The new provision requires the USPS to RIF all retirement eligible employees prior to laying off any workers not yet eligible for a pension, and to RIF the most senior of them first:

(ii) GENERAL RULE.—A reduction in force under this subsection shall not result in the separation of any non-retirement-eligible employee before a retirement-eligible employee.

(iii) LENGTH OF SERVICE.—In determining the order for the separation of competing retirement-eligible employees, individuals shall be separated in descending order based on length of service.

The law would also prohibit severance payments for such employees, who would also be forbidden from being reemployed by the USPS as long as a non-retirement eligible person was available. The revised RIF pecking order would apply only to bargaining unit employees.

Issa will introduce his amended bill at a meeting of his oversight committee this afternoon. The meeting is scheduled to begin at 1:30 EDT, and will be streamed live.

9-21-2011 “Subcommittee on Federal Workforce & U.S. Postal Service Business Meeting”.

Issa Amended Bill

In an article that’s typical of the misinformation flooding the news mdia and the web lately, DC Velocity helps spread the lie that the USPS can’t afford to pay its retirees:

According to published reports, the venerable agency that touches almost every American every day (except Sunday, of course) is so cash poor that it’s on the brink of defaulting on a pending $5 billion-plus pension payment to its retirees.

The blog doesn’t cite a source for its assertion, because there isn’t one- it’s not true. As most readers know, the USPS has no problem whatsoever in paying its retirees, and doesn’t expect to in the near future. The “$5 billion-plus” payment the author refers to is for the Congressionally mandated prefunding of potential future retirees health benefits over the next 75 years. Let’s make that clear- the payment is for the retirement benefits of people who may not even have been born yet! And the USPS has already socked away $42 billion for that purpose! (Which just so happens to be exactly $42 billion more than Congress has set aside for all other federal employees).

The author is correct in pointing out that the USPS faces massive challenges adjusting to the decline in mail volume. But he ignores the plain and simple fact that without the 2006 PAEA law, the USPS would be facing those challenges with zero debt and billions in cash on hand.

via Can the USPS survive? – DC Velocity.

NALC Report on Obama plan for USPS