Thousands of Post Offices May Morph Into Dead Letter Offices

Forget about stoplights and even stop signs. There are many towns and villages in America that don't amount to much more than a post office and a service station. Sometimes the post office is the service station and also the general store.

Quaint, you say? Yes, but not very profitable for the U.S. Postal Service (USPS), which likes to say it is a self-supporting business except when it isn't, which is most of the time.

Struggling to achieve at least something close to break-even status, USPS has been steadily closing post offices that aren't profitable. It reported closing 491 last year and is gearing up to close another 2,000 this year.

But that's just the beginning. The bean- and stamp-counters at USPS say they really need to close about half the post offices in the nation – roughly 16,000 – to weed out all the ones that are money-losers.

This may not sound like a big deal to consumers who live in major urban or suburban areas, where besides the post office there are UPS and FedEx trucks running up and down the streets and the post office is often something of an after-thought.

But it's a very big deal to people in small towns and farming areas, where the post office is one of the few links to the rest of the country.

Rural areas also tend to have a high percentage of older folks who may not have adjusted to online banking, email and reading the latest pot-boiler on their Kindles. Even those who have tried to make the adjustment are often frustrated by the lack of broadband and cell phone service.

Fresh air and open vistas are nice, but they don't do much to get your Social Security check delivered or your tax return filed on time.

$8.5 billion in losses

All this doesn't cut much ice with those trying to deal with the $8.5 billion in losses the postal service racked up in 2010. The USPS raises rates with some regularity and has cut staffing by a third since 1999 and would very much like to eliminate Saturday deliveries.

There's not much left to cut, postal executives argue. Not everyone agrees with that assessment though, including some members of Congress who would like to see the agency take a tougher hand with unionized postal workers who enjoy benefits more generous than other government employees.

A recent study by the Office of Inspector General said the USPS could save $700 million this year but requiring workers to pay a bigger share of their health care. That proposal went over with the rank-and-file about as well as you'd expect.

The American Postal Workers Union, which represents about 220,000 postal clerks, custodians, drivers, mechanics and administrators, says it is "increasingly frustrated" with the pace of its negotiations with the USPS but is remaining at the table. The smaller National Rural Letter Carriers' Association failed to reach agreement last November and is headed for arbitration.

Congressional critics say a firm hand is needed.

"One of my frustration is that the first approach the post office seems to take is to reduce service," said Sen. Susan Collins (R-Maine). Instead Collins says, the postal service needs to "tackle a benefit structure that is too expensive and it needs to look for ways to stay in business and deal with the digital age," according to a recent article in the Wall Street Journal.

The irony, perhaps, is that while urban and suburban residents have moved many of their activities online, higher population density translates to lower cost per customer, just as it does for telephone, cable TV and cell phone service – leaving those who need these services the most unable to get them economically.

Sadly, the post office hasn't exactly won the hearts and minds of its customers.  ConsumerAffairs.com has a collection of complaints about postal delivery that rivals that of any other business, agency or institution.  Its ability to soothe customers and resolve complaints seems sadly lacking for an agency that relies on taxpayers to guarantee its debts.

"I'll never do business with these people again," fumed Jay of Northfield, NJ, in a typical complaint. Jay said he ordered a simple $20 item from the National Rifle Association but did not receive it.

"They told me that the product had been delivered to my door and as far as they were concerned, it was delivered. Period. ... Can you imagine this? First they admitted that they had possession of it, then they basically called me a liar when I said that it was never delivered. Some fool delivered it to the wrong door, is what happened."

"For my $20 item, they lost 50 times that amount of business from me in one year. They can go bankrupt for all I care," Jay concluded.