NALC President Fredric Rolando testifies before Congress (beginning at minute 40). In an article that ran the day before the Labor Day holiday, the New York Times took the opportunity to fear monger about the current financial problems at the
September 6, 2011

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NALC President Fredric Rolando testifies before Congress (beginning at minute 40).

In an article that ran the day before the Labor Day holiday, the New York Times took the opportunity to fear monger about the current financial problems at the United States Postal Service and blame workers for the financial shortfalls the agency faces.

According to reporter Steven Greenhouse:

The United States Postal Service has long lived on the financial edge, but it has never been as close to the precipice as it is today: the agency is so low on cash that it will not be able to make a $5.5 billion payment due this month and may have to shut down entirely this winter unless Congress takes emergency action to stabilize its finances.


In recent weeks, Mr. Donahoe has been pushing a series of painful cost-cutting measures to erase the agency’s deficit, which will reach $9.2 billion this fiscal year. They include eliminating Saturday mail delivery, closing up to 3,700 postal locations and laying off 120,000 workers — nearly one-fifth of the agency’s work force — despite a no-layoffs clause in the unions’ contracts.


As any computer user knows, the Internet revolution has led to people and businesses sending far less conventional mail.

At the same time, decades of contractual promises made to unionized workers, including no-layoff clauses, are increasing the post office’s costs. Labor represents 80 percent of the agency’s expenses, compared with 53 percent at United Parcel Service and 32 percent at FedEx, its two biggest private competitors. Postal workers also receive more generous health benefits than most other federal employees.


Meanwhile, the agency has had a tough time cutting its costs to match the revenue drop, with a history of labor contracts offering good health and pension benefits, underused post offices, and laws that restrict its ability to make basic business decisions, like reducing the frequency of deliveries.

Crooks and Liars previously reported on this situation, noting that the entire problem could be based on a unparalleled requirement that the USPS fund retirement benefits 75 years in advance. Without this cost, the Postal Service is profitable and none of the other explanations offered by the Times is relevant.

The Times briefly mentioned the real problem and the real solution, but they were mere asides in the story while the focus was on declining mail volume and worker benefits as the problems and the perceived near impossibility of a solution being found that could work. The newspaper ignored the fact that the National Association of Letter Carriers (see testimony above) previously shot down all of these arguments and the Times failed to mention any of the greater problems -- including job losses and harm done to small businesses that rely upon weekend mail service -- that the draconian proposals being floated by Congress would create.

Congress is considering numerous emergency proposals — most notably, allowing the post office to recover billions of dollars that management says it overpaid to its employees’ pension funds. That fix would help the agency get through the short-term crisis, but would delay the day of reckoning on bigger issues.


They add that a major factor for the post office’s $20 billion in losses over the past four years is a 2006 law requiring the postal service to pay an average of $5.5 billion annually for 10 years to finance retiree health costs for the next 75 years.

These two throwaway lines explain the problem and the solution, yet Greenhouse barely notes their importance.

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