Obama proposes Postal Service bailout
President Barack Obama has proposed bailing out the US Postal Service, urging that it be granted to cut mail delivery to five days a week.
He also proposed allowing the service to get a $US6.9 billion ($A6.76 billion) refund from an overfunded pension fund.
‘Bold action is needed,’ Obama said. ‘The administration recognises the enormous value of the US Postal Service to the nation’s commerce and communications, as well as the urgent need for reform to ensure its future viability.’
Unless the government acts quickly, he said, the service will be insolvent by the end of the month, when it will have used up its cash reserves, will have reached its government mandated borrowing limit of $US15 billion ($A14.7 billion), and will be unable to make a required $US5.5 billion ($A5.39 billion) payment to its retiree health program.
Obama also proposed restructuring the Postal Service’s pension plan and allowing it to sell non-postal goods to bring in more money.
Tucked into his broader proposal to cut federal budget deficits, Obama’s plan stated the Postal Service is beset by long-term problems brought on by the recession and the loss of mail services to email.
Mail delivery has plummeted, with 43 billion fewer pieces sent this year than just four years ago.
Postmaster General Patrick Donahoe has proposed closing hundreds of post offices and mail facilities and eliminating Saturday mail delivery to save costs.
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Submited at Tuesday, September 20th, 2011 at 11:00 am on Politics by ethan
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