How Phantom Accounting Is Destroying the Post Office

[xchrom]

http://www.alternet.org/story/155702/how_phantom_accounting_is_destroying_the_post_office/

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Every 6-year-old soon learns that there is real, and there is make-believe. The massive post office deficit that is driving management to commit institutional suicide by ending six-day delivery, closing half of the nation's 30,000 or so post offices and half its 500 mail-processing centers, and laying off more than 200,000 workers, is make-believe.

Here's why: In 1969, the federal government changed the way it did accounting. It began to use what is called a unified budget that includes trust funds such as Social Security previously considered off-budget because they were self-sustaining through dedicated revenue. At that time the post office was, as it had been since 1792, a department of the federal government like the Department of Energy or the Department of Agriculture. While generating most of its revenue from postage it also received significant congressional appropriations.

In 1970, Congress transformed the post office into the U.S. Postal Service (USPS). The new quasi-public agency was intended to put the postal office on a more business-like footing. The Postal Service was allowed to borrow to make needed capital investments and was given more flexibility in how it spent its money. In return, Congress required the USPS to become self-sufficient. The subsidy, at that time running about 15 percent of total revenues (close to $10 billion a year in 2012) was phased out over the next 15 years. After the mid-1980s the only taxpayer funds involved, amounting today to $100 million a year, subsidizes mail for the blind and official mail to overseas voters.

In keeping with the new philosophy that the Postal Service should be independent, Nixon's Office of Management and Budget administratively moved its finances off budget in 1974. In 1989 Congress did it by statute.

[Egalitarian Thug]

1. This is the current game, create make-believe problems to keep citizens

from looking at the real problems they make as they shovel the loot out the back door. One day not very far away we will wake up broken and in in debt, having lost our nation to charlatans and thieves.

If you want to follow up with some more info on the manufactured USPS "crisis", look into the Congressional rules imposes on it, particularly those brought to the floor by representatives from TN & GA (homes of UPS & FedEx).

[1-Old-Man]

2. Excellent article, thank you for sharing it.