Government Unemployment Watch: USPS To Close Up To 3,700 Post Offices

Tyler Durden's picture

The problem with bloated central planning is that when austerity hits, the bloat goes away, and millions of government employees suddenly find themselves trying to enter the private sector, realizing they have absolutely no real competitive and marketable skills (more or less like investment bankers and hedge fund managers). And while America has yet to even remotely sniff austerity, the unemployment rate is already set to spike, after the USPS just announced it was preparing to close 3,653 out of its 32,000 total post office sites. Per UPI: "The U.S. Postal Service is expected to announce a plan to close 3,653 post offices, mostly in small communities, in a cost-cutting measure, officials said. A USPS spokeswoman said the post offices were chosen because they get the "least amount of foot traffic and retail sales," The Wall Street Journal reported Monday." Trust the bureaucrats to try spinning this bad news as good: "They also were selected because there may be local businesses that could provide some postal services to the community, spokeswoman Sue Brennan said." Well by that logic there are private businesses that cover every aspect of the government's "job" much better, and much more efficiently, up to and including that of the Fed (sorry, that already is private). Does that mean we should outsource every aspect of the bloated centrally planned economy that America has become? Of course the answer is yes, but that just does not jive with the current iteration of kleptofascist socialism.


The list of the closures, amounting to about 11 percent of the USPS' post offices nationwide, will be made public Tuesday by Postmaster General Patrick Donahoe,


The Postal Regulatory Commission would have to approve the widespread closings, as the USPS prepares to file a request for a "national change of service," Brennan said.


Donahoe also will announce "a replacement strategy" involving third-party retailers, she said.


"If you're a community and there is a local convenience store, for example, we might be reaching out to these organizations to see if they would be interested in providing limited postal service for the community that might be affected," Brennan said.

So between corporate and now public sector layoffs, expect the unemployment rate to resume climbing steadily to double digits, hitting it some time in Q4, at which point QE3 will be inevitable, as Goldman predicted yesterday.

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redpill's picture

Why don't we cut the postal service in half and save even more?  Half of addresses get delivery on Mon-Wed-Fri, the other half on Tues-Thurs-Sat.

cat2's picture

It should be cut by....  40%

SilverDosed's picture

Fuck the USPS, Third most horrible service of any of the major delivery services around here. Not as bad as UPS and FedEx but pretty damn close. I would say this is bullish UPS and FedEx but those companies are too horrible ever to be bullish.

utgolfer's picture

Yea that makes a lot of sense, FedEx and UPS ranking below the USPS. Nice try commie.

Mongrel's picture

Well hell, there goes Slapout and Bugtussle, Alabama . . . not to mention Lizard Thicket and Yampertown. Damn!

ALPO's picture

At least USPS doesn't mangle my packages.  Everything that UPS brings to my house looks like it has been kicked down a flight of stairs and then stomped on by a pack of hyperactive gorillas.

Not that USPS doesn't have its own annoying traits.  But at least they get the items where they are going without destroying them.


A Nanny Moose's picture

Perhaps this is why the O'bamabot could not guarantee that Social Security checks would go out?

parch702's picture

While sitting stoned in The Pit last night we got talking about the PO and the elimination of Sat. delivery. If they did that what would stop them from saving real money and going only to a Mon./Wed./Fri. delivery protocol?

It's mostly junk mail anyway....

Just get my bills there on time, that is, the ones I don't pay online.


JoeSexPack's picture

If FedEx or UPS sold stamps the USPS would die in a year.


USPS has a monopoly on postage stamps, that keeps them alive.


Try buying a sheet of paper stamps from FedEx or UPS, account credits or individual postage sure, but no sheets.


Postal clause in constitution interpreted to ban others from selling stamps.

knukles's picture

Could fire half them 'cause they don't work anyhow... you know, all the folk sittin' in rooms with nothin' to do and bein' paid for it.  USPS's idea of saving money.   In fact fire 'em all and still'll be no change 'cept the junk mail don't get delivered.

doomandbloom's picture

how much time will it take before people realise that technology is making people redundant?

We will have to work 3/4 days a week( instead of 5/6) take a pay cut maybe, to allow others to get jobs.

But this is what technology was supposed to do help people relax more. But we dont have a social structure to manage the proceeds of technology.

Corn1945's picture

The Postal Service can actually be reformed I think. Cut service to five days. Get rid of Saturday for example. Close offices that get little traffic to save money. Current workers need to take a pay cut and current pensioners need to take a reduction in benefits. The alternative is layoffs and pension checks not going out.

Raising prices isn't going to work because the USPS is easily avoidable for most things at this point.

Cole Younger's picture

"USPS is easily avoidable for most things at this point."

Then why have the USPS in the first place? Tradition? They are not making enough revenue to support themselves. 

redpill's picture

Junk mail is the only thing that keeps it remotely justifiable to go to every house every day.  And most people just throw it away.  Per my post above, they should hack the whole organization in half, go to a 3-day per week delivery schedule and alternate delivery days.  Then raise rates on the junk mail.  If companies want to stuff mailboxes with marketing it doesn't need to be subsidized by US taxpayers, they can hire someone to do it or pay a market rate to the postal service.

Long-John-Silver's picture

Physical SPAM Bitchez! It's in your mailbox.

Arthor Bearing's picture

Such practical, common-sense solutions. "If companies want to stuff mailboxes with marketing it doesn't need to be subsidized by US taxpayers" YES! I would immediately put you in charge of the task force for post office reform, if I, you know, had any power or authority

A Nanny Moose's picture

Bingo. 99% of the crap in my mailbox is subsidized junk mail. Most of the CC offers, I shred, then mail back in the PPD stimulate the economy.

kridkrid's picture

ha... that's great.  I now have a new hobby.

CrazyCooter's picture

Tape the PPD enveloped to an apporpriately sized scrap of 2x4 ... or a brick if its JP Morgan Chase. :-)



goodrich4bk's picture

The USPS isn't subsidized, so going private doesn't save taxpayer money

  Sure, have FedEx and UPS take over.  I'm sure they will come up with a 2-3 day service (similar to the average USPS delivery rate).  Oh, looky here: they already do that for only $19.44.

Great idea, moron.  I just saved no taxes, laid off that nice lady who works in our post office, increased my mail costs by 2,000 per cent and now you want to have my mail delivered by the 7/11 clerk?  I am quite certain he will love the attention he'll be getting now that he is the town gossip, but the rest of us, not so much.

sun tzu's picture

How are they funding themselves? Maybe Federal Reserve loans?


The US Postal Service filed its eigth month preliminary financial report of the 2011 fiscal year (unaudited) with the Postal Regulatory Commission (PRC) . USPS reported a net operating loss of $1.3 billion for the month of June 2011. This same period last year saw a $642 million net loss. In October 2010 USPS saw a net profit of $283 Million, November 2010 net loss $456 million, December 2010 net loss $156 million, January 2011, net loss $451 million, February 2011, net loss $1.1 billion, March 2011, $657 million, April net loss of $747 million . After eight months into FY 2011 USPS reports a net loss of $4.7 billion (same time last year it was $2.9 billion). USPS May 2011 Financial Results Net loss $1,348 billion for June and $4,653 billion ending  May 31, 2011. at the end of April USPS loss was $ a little more than $3.3. billion.

Agent P's picture

While I agree with you on the cost cutting measures (particularly on dropping Saturday delivery and office consolidation...there are four offices in my town serving a population of 130k), I disagree with you about raising prices.

Yes, with email, online bill pay, etc. postal services are easily avoidable.  However, there is still a large amount of mail that needs to be sent the old fashion way, and charging someone a whopping $0.44 to come to you, pick up a letter, and hand deliver it anywhere in the country is just plain stupid.  I challenge you to come up with another service offering that kind of value (excluding Zero Hedge and free internet porn).  If Congress would let the USPS charge market rates for their services, the business model would stand on much firmer ground.

hedgeless_horseman's picture

However, there is still a large amount of mail that needs to be sent the old fashion way..

Like what?  I haven't opened our mailbox for years.  I think my wife goes about once a week to collect the junk mail to shred for animal bedding.

Agent P's picture

"Like what?  I haven't opened our mailbox for years.  I think my wife goes about once a week to collect the junk mail to shred for animal bedding."

  • Birthday cards
  • Christmas cards
  • Hand written thank you notes
  • Bills (though I wouldn't be sad to see those go)
  • Victoria's Secret catalogues
  • Postcards from travelers
  • Ammo ordered over the internet
  • Free animal bedding

The list goes on and on...

sun tzu's picture

Those can all be done by email or UPS/Fedex except for the bedding. You have free local rags at the grocery stores for that

StychoKiller's picture

First class letters are the province of the USPS and the USPS only!  Read the US Constitution.

CrazyCooter's picture

Something about a baby and bath water come to mind ...

Folks having the ability to mail a DOCUMENT to ANY citizen in the country is valuable. What kind of documents? Checks? Check. Legal? Check. Bills? Check. Cash? Check. Letter? Check. Yes, the USPS has probably larded up, but that does not mean the underlying service is not valuable.

And in case it wasn't mentioned, at least the USPS is constitutional, unlike most other government bloat ...

Furthermore, Congress may establish post offices and post roads (the roads, however, need not be exclusively for the conveyance of mail).

I am ok with cuts, but *think* before you say the whole USPS system should get the plug pulled.

If the USPS was killed by Bohner, Reid, and Obammy to save the US spending habits, it would really suck. I am a web programmer by profession and I went kicking and screaming into online banking. I still REFUSE to do online bill pay. Only moving to Alaksa pushed me over the banking cliff and I am very lucky to have USAA. I don't think I would do it with any other bank (and trust me I know how to take a pay check to the issuing bank - I lived without banks for years). I prefer to pay CASH for all my purchases. I prefer to write a CHECK for all my bills. I prefer to use my CREDIT CARD for emergencies, (not exactly the shopping mecca of the world up here), and pay-at-the-pump (paying cash is very annoying for a fill up).

Yes, I have seen great comments regarding junk mail. Yes, there are unions involved and things need to be brought inline. Yes there is fat to cut. Yes improvements can be made. But if the USPS goes, private companies will only want the profitable volume centers and the lower volume areas will get screwed.



Paul Bogdanich's picture

The problem at the Postal Service is too many offices in rural areas (jobs programs for small states) and the fact that Congress won't let them charge more than 15 cents an ounce for advertising mail like credit card solitications and so on.  Take care of those two issues and the system makes a profit and delivers better more comprehensive service than any private carrier.    

SilverDosed's picture

Too much lobbying power by the physical spammers.

Catullus's picture

Interesting. I generally don't associate shrinking operations, limiting availability and service and paycuts as a healthy enterprise. These are death nails for it. People will just continue to use their alternatives and their truly good employees who aren't government pension slaves will just leave.

Everybodys All American's picture

How about implementing a plan to significantly raise tarriffs on China and others thereby forcing jobs back into this country? Protectionism has not worked for the good of the middle class and I see no good reason to continue it any further. Believe me I'm no Karl Marx either.

MachoMan's picture

Implementing increased tariffs would be a form of protectionism....

weinerdog43's picture

Well, duh.  It's hard to compete with forced and child labor, no enviromental restrictions and zero safety net. 

Alasdair's picture

If wages aren't increased in conjunction with productivity, money accelerates to the top.  Wealth inequality explodes and the rest of society gets to share a big sh*t sandwich.

The Profit Prophet's picture

Not to disagree with your very valid point....but the much more disturbing and destructive trend is that of the low-cost Asian worker making the high-cost American worker redundant. This is the primary factor that is collapsing the current system.

T.E.I.N. everyone!

Bob Sacamano's picture

Massive headwind for the US -- US has priced itself out of the world market (but we have had a big debt financed consumption party for the last 30+ years that should provide nice memories).  For years the costs of higher US wages and government regulations were offset by higher productivity.  That is all changing now.

The productivity of the rest of the world is going to rise dramatically the next 10+ years which will significantly reduce US productivity margin.  US wages are too high for a world that will happily work for $5 per day and who do not insist government solve every problem known to man. 

pods's picture

We do have a social structure D&B, it is called the top 0.001%.  

I have argued your point with many.  Why is it that if technology has made us so more productive we are still working this long?

The answer I have come up with is that it is to keep ahead of the expanding interest.  We have to grow faster than the interest.  And compounding growth is tough.

Take away interest on debt money and things get easier.  Of course, then people would have more time to think, and we cant have that!


Bob Sacamano's picture

Most are working so long because throughout their life they decided ever expanding consumption and standard of living was a necessity. 

No one thought a very small house or one car (used) or no eating out or two movies per year or vacations less than 100 miles from home or etc etc was a good idea.  All the money spent on over-consumption did not go into saving for retirement so they wouldn't have to work so long. 

Can't spend more than every dollar earned (via debt) and have a long comfortable retirement.  It is called bad choices -- which have consequences. 

pods's picture

Well on an individual basis, yes your argument holds.  But systemwide, you have to have expansion or it fails.  

If everyone did as you say, and lived within their means, did not buy on credit, etc.  We would already have collapsed by now, as production expansion cannot keep up with interest compounding.  So slowly you would run out of money in society, halting production, slowing money, etc.

That is how the system works. I could not believe it when mako first stated that here (haven't seen mako in some time).  I was dumbfounded how someone was stating that by all of us behaving in a manner which seemed prudent would actually collapse the system that we are in.  The longer I thought about it, the more I realized that that is how the system works.  

So unless you can have compounding growth that is ahead of the compounding interest, you are dead.  And to have zero growth in this system defeats it. Which is why I behave in the way that you speak.

I actually do go on vacations, etc, but do it all out of pocket. I do not have credit lines anywhere.  Zero access to credit. I have a mortgage and that is it.  Used cars that i fix myself, etc.

So I am doing what you say, but not to have a happy future.  I am doing it to crash this system so my kids may have that future.



Bob Sacamano's picture

"If everyone did as you say, and lived within their means, did not buy on credit, etc.  We would already have collapsed by now, as production expansion cannot keep up with interest compounding."

If everyone lived within their means, there would be no debt (or interest) that would require ever increasing production.  How we got into this mess and how it could have been avoided is directly related to the original sin of debt financed consumption (no borrowers, no debt).   Greedy people could not refrain from borrowing in order to consume more.

Understand what you are saying about where the US is now - post greedy, debt-financed consumption binge.  The US will be in a long period of decline - particularly relative to much of the emerging world. 

pods's picture

I would love to go back there Bob, I really would.  But since the introduction of debt money, we cannot have that now. Well, until it crashes.  After it crashes we can go back to real money, do away with fractional reserves, and learn to live with little to no growth due to pulled forward demand.  

I would love to not have to "chase return" and only see the value of my savings go up slowly due to the slow deflation from technological advancement.



Bob Sacamano's picture

My slant is, at the end of the day, the banking system's introduction of debt money is necessary, but not sufficient to create the problem.  The borrower is the one who ultimately decides whether to avail one's self of the debt money (at least I don't think many loans have been originated at gun point).  If folks just could of had the discipline to say no, to walk by the candy dish, we would not have many of these problems.  Understand the flip side is the bank shouldn't make loans that can't be easily repaid.  But I am inclined to put more responsibility on me (the borrower) and not someone else (the lender). 

As you might tell, I think folks are generally pretty greedy and selfish (and these foibles are not completely foreign to me, but I like to see myself more disciplined than most!).   These traits show up other related places as too many see themselves as entitled and/or victims - which creates other perverse consequences. 

Appreciate your thoughts on this -- while seeming complex at times, it all comes down to some fairly simple concepts. 

knukles's picture

Guess that means the machines are taking over.
Ned Ludd was right!

AhhhItBurns's picture

Yup. Technology makes people redundant all the time. I remember reading a line a few years ago which said "The database admin overtook the file clerks, and the automatic switchboard overtook the operators". Now, the cloud is overtaking the database admin. I would not be surprised if the bookbinders get wiped out by kindle/nook/etc in the coming years (especially since reading rights are revokable thanks to forms of DRM). The only ones who are safe are garbagemen, and a portion of their job has been taken over by the automated can lifters). Even if times get tougher people will pay to get someone to haul their trash away.


I would not be surprised to see a reemergence of luddites in the future...

youngman's picture

Its funny how they could never cut a salary or a pension to make it more competitive..or never