By Tom Blau
Saturday Mail: A Thing of the Past
In an
effort to cut costs, and reduce their ever-expanding deficit, the USPS has
announced that an end to mail service on Saturday’s will be coming,
specifically starting August 5th. The plans are to stop collecting
and delivering first-class mail and letters, but large packages would still be
delivered. To summarize, people will have to agonize and suffer for that one
special birthday card to come or for loads of junk mail to arrive for one more
day.
As many
of you probably don’t know, the USPS has been a little bit of a bind the past
half a decade or so. Make that a big bind. Since 2006, the agency has defaulted
twice on payments totaling just $11 billion. That’s right, $11 billion! It has
also exhausted a $15 billion line of credit from the U.S. Treasury. Last time
we saw a business in this much trouble, Obama was bailing out GM! Because of
their shortcomings, the USPS has been borrowing billions of dollars from
taxpayers to make up the differences. From the chart below, we can see that the
USPS is bleeding, make that hemorrhaging funds, and that they have been on a
steep and steady decline for the past decade.
The new plan is expected to save them about two billion
dollars per year, which may seem like a lot, but is only a drop in the gigantic
$16 billion bucket of losses they reported in 2012. Coupled with technological
advances making more and more mail go by the wayside, the USPS is in need of
big help. According to estimates, some 22,500 employees around the nation will
face the end of their careers when this new initiative is implemented in just
under six months.
The end
of Saturday service will put a stop to a tradition that has been going strong,
with only a few hiccups, since 1863. In a Gallup poll conducted by CNN News,
69% of people surveyed said that this either wouldn’t affect them, or that they
wouldn’t mind the change. Even considering statistical anomalies and under
coverage due to biased reporting, this still well over half of the population.
Personally, as a business-minded man, I welcome any changes like this that will
put the agency back on track to cut its budget problems.
But
Marketers do not have the same opinion on the hot button issue. Considering
that direct mail marketing is the most powerful form of advertising, they will
have to switch their schedules of mailings around so that their target market
receives advertisements before the weekend. While this may not seem like a big
deal to the majority us, many of these big companies are not happy with the
decision.
Talking
about people that will be affected by this, what about those 22,000 employees
that will be out of work coming this August? Many postal workers are now in
severe suspense of their job security and what will become of it in half a
year. One of the benefits of the job about a dozen years ago was that these men
and women had total job security. Nothing could touch them, because no matter
what, they had mail to deliver, yet now, there is a serious threat that the
USPS could be going back on their word.
It is interesting to see how greatly changes in technology and inflation have impacted negatively the USPS. Not delivering mail on Saturdays doesn’t seem like it will solve the problems that are looming over the postal service as whole, because of the 12 billion dollars the USPS lost last year alone. As you said cutting 2 billion dollars won’t exactly make that big of a difference in the overall success of the USPS. Drastic changes are going to have to take place for the USPS to once again become successful; like all successful business they will have to adjust to the times and make in a change for the better. If changes don’t take place soon we may be looking at another government bailout, but the biggest problem with that is that the car market was down because of an unusually low economy. The postal service isn’t necessarily affected that greatly by the economy because they are not producing or selling novelty items. Clearly something has to be done to save the future of the USPS and it will be interesting to see what the future holds.
ReplyDelete- Collin Sternad
It’s interesting that they are getting rid of Saturday mail service, and as disappointing as it is to wait a couple extra days for a birthday card or to hear back from a college, it is much better to save the business/economy by cutting back a day on mail service. But for 22,000 employees to be out of work because of this change is just absurd, there should be some sort of benefit for them once they lose their job, because that will only increase the unemployment rate, which reduces America’s economic success. I think it is important to fix a company’s debt, but there needs to be a balance between employee loss and company gain.
ReplyDeleteI will feel no effect from this because I am not the owner of the house and do not feel that it is a big deal because I don't receive bills or much of any other mail besides Christmas gifts and birthday gifts. But looking at it from my parents side it might be a big deal because of the fact of getting bills a day late. But other than the bills I don't think it will effect them either.
ReplyDeleteOur economy is crippling and therefore something needs to be done about it. In the situation regarding postal service, what economists need to look at is the true value of sending letters faster and losing money. I think that everyone emails and texts more anyways, therefore I think that this law being passed will benefit the country and save us more money. The only thing that the postal service is really significantly used for is online purchases and sending. The postal service is great for this reason, but if we want to save more money this is the best way to do so. I think that the benefits outweigh the negatives when it comes to getting rid of first class mail and losing money. Why should we spend more money on sending out a letter faster when the time will pass anyway? The government is finding great ways to save money where it can be spared.
ReplyDeleteI think this is a great idea. This saves us two billion dollars a year that adds up in the long run. Yes, we might have to wait longer for birthday cards but if it helps the country's debt why not. It is a very interesting topic though because there will be jobs that are loss in the process of it all and that doesn't help the unemployment rate at all either. This will end up cutting some faculty members of all post offices.
ReplyDeleteI agree that this is a big step in the right direction, but what I don't get is how they could be this far in the hole to begin with. A $16 billion deficit, for a public institution as recognized as this is astonishing to me. Although they will be saving $2 billion, how will that affect the nation on the whole, when over 20,000 jobs will be lost? Many questions it seems will be answered in the coming months, and I can't wait to see the answers.
DeleteThat's scary to think about that many jobs being lost, and how those people are going to make a living after their current job. Although they have around 6 months to look for another job, that still isn't a lot of time considering the current job market. I could also see that it would be a big hassle for the postal service needing to deliver mail before Saturday to satisfy the customer's needs. I feel that to most people the mail service will not be missed unless it affects you directly. Overall, this is an interesting topic to discuss and it will be interesting to see how this issue plays out. - Jeremy Koehler
ReplyDeleteOverall this new plan sounds great and just like Kyle said considering it will save us a couple billion dollars a year, that's probably the best way to fix the debt that the USPS is in. As well I don't think that it's that bad if you have to wait one more day for the mail to come, and I don't think anyone besides some businesses will be affected (e.g. receiving shipments a little later, etc...) Also this all doesn't really effect me to much considering I don't own a house or receive much mail of my own and I really don't think others will miss this service much either considering it is only ONE day, so overall I'm for this if it will help USPS get out of debt and save taxpayers.
ReplyDeleteIt will be interesting to see how this affects businesses, but for the most part it will not bother the general public. I know that I won't mind this change, and 69% of the population also agrees. This is a start to cutting back on the budget and while a lot more still has to be done I think this will be a great benefit to the USPS. A problem that could arise is that while the USPS is saving themselves money, it could cost other large businesses theirs, and that could turn out to be more disastrous than the problem we are trying to fix right now. It will be interesting to see how this whole thing plays out, but it is good to see that some changes are being made to positively impact our economy and I hope that this benefits us.
ReplyDeleteAs decades continue to come, our economy and lifestyles will keep continuing to evolve. People are switching over to more technologically advanced methods rather than the old hand written letters. Email and e-cards are faster than air mail which is why people lean to those techniques as well. I do not believe that Saturday service will be missed by the citizens and 69% of the surveyed people agreed with this statement. There is an entire week to send mail and businesses should send their mail in that time period. If these changes are not done soon the USPS services could increase their amount of debt, more than the $12 million they lost last year. The USPS needs to try anything to stay afloat and it will be interesting to see if this alteration helps their situation.
ReplyDeleteHonestly, yes it will be missed. Maybe it is just me, because I have family working for the postal service, but it scares me that even the postal service is changing now, It could affect more than just that too. If you think about what could this change by effect. The advertising companies that don't earn as much by extension, families of the Postal workers that were laid off, bill payments that may end up coming later than expected due to Saturday postal closings, are all possible targets of the Postal offices being closed on Saturday. More than that people with important pieces of mail might get into big trouble by not getting mail in time, especially because it is more than two days in a row. If it was day that wasn’t Saturday or Monday, then that may be better off because simply because a package may not be sitting in the offices for two days straight that it may arrive at its destination sooner.
ReplyDeleteI think that getting rid of Saturday mail to cut the deficit t is a great idea. Finally as a country we are starting to realize the importance of money, and we need to know that we cannot just spend, spend, spend. Obviously its going to take a lot more than just no more Saturday mail, to eliminate the deficit, but its a good start. And a good sign, that our country may be getting back to being on the right path.
ReplyDeleteI have to agree with Anthony n this one because I see the Saturday news as a dying breed that just wastes American dollars. Even though we are losing many jobs by eliminating this group, like you stated above, i would still have to agree with eliminating it. Just look at the trends that you shared with us, people are not using the postal service as much and the prices have been jacked up for those who still do. It is just another sacrifice that some will have to make for the greater good I believe.
ReplyDeleteOne of the biggest problems in our country is the problem of the huge debt we are in. I believe that the no Saturday mail idea would really help our countries economy to start to get back on track with money and spend it more wisely. The article said that the no mail program will help us gain $2 billion dollars per year. That is an incredible amount of money that we will be able to get back just from cutting out one day of mail. Realistically, there aren't that many people that use mail anymore anyways so this could be a great start to a better economy.
ReplyDelete