Watchdog Slams USPS for $82 Million Net Loss

For Immediate Release

Contact: Ross Marchand (908-670-1398)

WASHINGTON, D.C. – Today, the Taxpayers Protection Alliance (TPA) called for real reform as the United States Postal Service (USPS) reported an $82 million net loss for the second quarter of fiscal year (FY) 2021. While this number is significantly lower than the net loss of $4.5 billion for the second quarter of FY 2020, non-cash workers’ compensation adjustments obscure the true extent of the loss at the USPS. Excluding these adjustments, second quarter losses would have totaled approximately $1.7 billion compared to a loss of approximately $1.9 billion for the second quarter of FY 2020. In total, the USPS has lost more than $80 billion since 2007.

TPA President David Williams criticized the USPS’ business model, noting, “America’s mail carrier is simply unable to get their costs under control. With an increase of revenue of more than $1 billion (6 percent) this quarter compared to the same quarter last year, and a pandemic that is abating, the USPS should be on the financial upswing. Yet, increases in expenses, including a 16.7 percent uptick in transportation costs, continue to threaten the fiscal health of the USPS and expose taxpayers to the dangerous possibility of a bailout. The USPS has already benefitted from a forgiven $10 billion loan. Congress throwing more money at the agency will not solve the USPS’ core issues. The agency needs to fundamentally rethink its operations in order to continue delivering for millions of American households.”

Williams continued: “Fortunately, Postmaster General (PMG) DeJoy has been advocating for comprehensive changes to the struggling organization that would cut costs across the board. Released in March, the USPS’ ten-year reform blueprint includes needed reforms such as greater accountability in highway contracting, network consolidation, and pricing policies that more closely reflect underlying delivery costs. The agency has already moved toward fine-tuning its network and will consolidate at least 18 of its mail processing plants, but far more needs to be done to ensure lower costs and improved performance. Unless the USPS moves quickly to revamp their pricing formulas and ensure that package prices adequately reflect costs, expenses will continue to grow faster than revenues. Taxpayers simply cannot afford this unsustainable status-quo.”

Williams concluded: “Given the USPS’ many troubles, it is tempting for agency leadership to degrade its service standards and slow mail delivery services across the country. Yet previous experience shows that this approach is unnecessary and counterproductive. America’s mail carrier can maintain fast delivery speeds, while bringing costs under control and enacting smarter pricing policies. Congress can no longer sit on the sidelines and allow this financial implosion to continue. Real leadership is needed in the House, Senate, and the USPS itself to demand significant reforms.”

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Taxpayers Protection Alliance (TPA) is a non-profit, non-partisan organization dedicated to educating the public through the research, analysis and dissemination of information on the government’s effects on the economy.