"Burdensome and flawed benefit payments have contributed to almost 90 percent of the $20 billion loss in the past 4 years," David C. Williams, Inspector General of the Postal Service, told the House Subcommittee on Financial Services and General Government. "This has raised the cost of the infrastructure, postage rates, and forced the Postal Service to incur debt."
Williams' get-to-the-heart-of-the-matter testimony was a refreshing change from the bone-headed pundits complaining about the Postal Service wasting taxpayers' money. It's worth quoting extensively:
"My office has produced a series of reports highlighting the exaggerated estimates, enormous overcharges, and excessive prefunding levels that plague the retiree pension and health care systems. To continue contributing to funds that now appear to exceed the 100 percent funding levels is even more egregious when compared against benchmarks in the public and private sector and OPM [Office of Personnel Management]’s levels.
"I agree with Senator Susan Collins’ call in September 2010 for the OPM to change, under current law, its calculation of Postal Service CSRS pension fund payments."
"In the near term, the Postal Service and Congress should consider halting further payments to benefit funds until the surplus is used, funds restructured, and mistakes corrected. The Postal Service can use this time to learn how to live below or within the Consumer Price Index, shed its debt, and find its role in the digital age.
"The Postal Accountability and Enhancement Act incentivizes the Postal Service to adopt a leaner volume driven infrastructure to assure readiness for the 21st century. This will require:
- Optimization of the network of post offices and plants;
- Conversion to evaluated letter carrier routes to allow effective management;
- Flexible work rules to match the ebb and flow of mail;
- A comprehensive delivery point strategy that maximizes curb side delivery and cluster boxes;
- Simplification of mail acceptance and pricing; and
- Evaluating the need for 74 districts, 7 Areas, and two law enforcement agencies.
Williams' office has a habit of cutting through the Beltway BS to reveal the truth about postal finances.
The Capitol Hill crowd politely argues about prepaid or overfunded health benefits for Postal Service retirees. But in a 2009 report, the OIG correctly characterized the accounting scam as using “Postal Service funds to make the president’s budget seem smaller” to the tune of $5 billion-plus each year.
Four months later, another OIG report charged that the federal government had overcharged USPS $75 billion for pensions.