The U.S. Postal Service is in trouble. The financial vulnerability of the Postal Service is not a new development. The nonpartisan Government Accountability Office has cited Postal Service finances as a high-risk concern since 2009. This GAO assessment is based on basic math and obvious trends: First-class mail volume has declined due to email, while Postal Service labor costs continue to escalate.
After peaking in 2001, first-class mail volume declined 43% by 2017 due to the increasing use of electronic communication such as email. Since COVID-19 hit, the volume of mail delivered by the Postal Service has drastically declined further. Businesses have cut back on sending advertisements and bulk mail, — the agency’s main source of revenue — leaving it on track to run out of money by as early as September without congressional intervention. During debate over the $2.3 trillion Coronavirus Aid, Relief and Economic Security Act in March, House Democrats were seeking $25 billion in subsidies, $11 billion in loan forgiveness and a $15 billion loan for the Postal Service. The final CARES Act legislation provided the Postal Service with a $10 billion loan, while calls for a much larger handout have fallen on deaf ears.
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