The United States Post Office announced today that they will be going to a 5 day work week and stopping Saturday deliveries. The reasons why are obvious, I mean if you ran a company that lost 25 million dollars a day, wouldn’t you do something to stop the bleeding? It’s no secret that the USPS is a financial mess. Last year it lost a whopping $15.6 billion and is facing annual budget deficits of $21 billion by 2016. One way the postal service has been trying to reduce those massive losses is to scale back the number of days it delivers mail. Postmaster General Patrick Donahoe said the post office would no longer deliver or process first-class mail on Saturdays — though it would continue to deliver packages and keep post offices open six days a week.
While there are some ripple effects in the stock market if the entire postal system were to collapse, some which might even be good for a few companies. Image if FedEx or UPS were to take over the reigns for getting the mail where it needs to be. Do you think the fact they have to answer to shareholders (vs having a blank check from the government) would give them a better chance of succeeding or even turning a profit. My answer is a resounding YES. Unfortunately that is not the case, and our national mail system is a giant vortex that is sucking resources on the path to its ultimate demise.
My point is not to rant, or point fingers to a once great national program that was major reason for the United States early prosperity. It’s to send a small cautious warning alarm that some of the major financial problems that we are going to face in the not so distant future are not going to be easy, and more likely to be downright inconvenient. So add the USPS to the list of leaky buckets that Uncle Sam will need to fix before we waste additional limited resources on it.