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U.S. Postal Service: RIP

Posted Jun 15 2009, 06:05 AM by Douglas McIntyre
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The U.S. Postal Service, which has been dying for years due to the advent of the fax, e-mail, and overnight delivery, may finally be close to its last act.

The agency lost nearly $2 billion in its last fiscal year and is faced with the serious consideration of cuts of up to 3,100 offices, potentially eliminating thousand of jobs. Media reports say that first class mail volumes are plunging.

What is killing and will probably eventually finish off the Post Office? In a word: “broadband,” the high-speed Internet system that the current Administration plans to build out in the next two years.

According to MarketWatch, the Postal Service is already looking at stopping Saturday delivery. The next moves will probably cut the number of weekdays the mail is dropped off, particularly outside urban areas where the cost of reaching homes and businesses spread over a wide geography is enormous.

Broadband has taken away the need for sending letters and may large documents. Broadband connections allow users to securely download encrypted files, some of which are the equivalent of thousands of pages of paper. The files can be sent and received in a few seconds compared with days to move them by mail.

Payment systems which wire transfer money have nearly eliminated the role of the check in paying bills. This will only increase as e-banking does.

Even the magazine and newspaper industries which relied on physical delivery systems for decades now use the Amazon (AMZN) Kindle as a way to get the printed word over the Internet and downloaded onto the device. Almost every major print product also has an Internet version. Sending magazines via mail is expensive. Cutting back on that form of delivery would be a blessing.

The modern postal system killed the pony express. The USPS could only last so long before it was itself replaced. That time has finally come.

Top Stocks blogger Douglas A. McIntyre is an editor at 24/7 Wall St.

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Comments

 

Wow, I cannot believe how no one hear has [really] brought up how ridiculous it will be for you to receive packages in the mail if the USPS went away.  It costs less than $2.00 to send a CD in the mail with the Post Office (3-4 day delivery).  Cost from UPS?  Around $8.00.  I don't even want to know what FedEx would charge.  So you, as the buyer, will get hosed immediately.  Sellers and vendors will eventually feel the heat when they begin to realize that their "lucrative" company accounts with UPS/FedEx are driving away buyers in droves.  You know, because people don't want to pay $8 shipping on a $1 CD they bought on eBay.

Don't even get me started on international shipping either.  UPS and FedEx have a LONG way to go before catching up with the USPS in that arena.

Sorry, but FedEx and UPS are still pretty useless to the everyday consumer.

Responding to JC.  If you want to know where the older trucks are visit a smaller town.  I live in a town of approx 40,000.  My parents and both grandparents spent there entire careers working for USPS.  My mother in particular has been there 36 years and is still delivering mail to this day.  She goes out every summer in 100 degree + heat with no air conditioning in a heap of junk old truck that essentialy works as an oven. The windows don't roll down and they aren't allowed to drive with the door slid open.  The trucks they are given break down more often than not and they are not being replaced, just pieced back together.  Also, for those who think USPS is no longer needed, in my town alone there is one office that is short 9 carriers.  Meaning there are 9 routes with no one assigned to deliever them and the other carriers must pick up the slack keeping some of them on the street until well after 7pm working a 12hr+ day. Management is obviously less than perfect and very hard to work for but there is still a large number of dedicated and hardworking USPS employees.

Try charging the same for junk mail as first class mail. I get far more junk mail delivered then any other. But the junk is at a lower rate. Every time the cost of a stamp goes up, the fewer people use their system. A severe downsizing is in order.

The postal service is still essential to our everyday world.  If you think for a second that the USPS is expensive try sending or receiving packages via FED-Ex or UPS to either Hawaii or Alaska.  $50 and up for a package that weighs less than a pound.  I know.. it has happened to me.  The USPS while I agree hires the rudest counter people on the planet, here in Alaska, it is my mail saviour.  I use USPS exclusively for all my mailing needs.  

I just retired from 34 years at the post office. There definately needs to be some changes made including the attitude of window clerks, misuse of sick leave and the fact that management just doesn't care. Most of the workers are very self concious of their duties but the ones that aren't are dead weight and need to be trimmed. Believe me the mail volume is there but just not enough souls to distribute the mail. Changes do have to be made and I believe a private industry can turn the PO around into a money making machine.

It is interesting that in a time when our President is so worried about the employees of GM and Chryslet, AIG and Bank of America, he seems to have no regard for the hundreds of thousands of employees of the Postal Service who will be out of jobs and on welfare, thanks to our economy which will offer them no jobs to go to. What about their healthcare, life insurance, childrens' education, etc? Why isn't he offering money to the USPS as a bailout package?

At the same time, whi isn't the USPS offering money transfers and fax service at its facilities? Why doesn't it offer Notary Services and other ways to raise money using the same employee base it currently has?

I believe the Postal system has been and will always  be. Yes, ya'll speak of the high tech ways to sending documents, e-mails, ect...but wake and and smell the coffee, the number of people living in the United Staes are "normal: every day people, those are the people I think are carrying the burden of the debt for the government, we can afford the high tech gadgets, to a lot of Americans it a struggle to pay the electric bill, that runs all that stuff,  what going to happen if and when all that high tech comes down on its knees due to power failures.

I depend on thePost Office as many others to commuicate with family, freinds, businesses, I don't trust my personal info to machines, which can be gotten into, no way. I'll trust the USPS with my business.

You people who want to see the end of the Postal Service and then complain about the price of a stamp are unbelievable.   Half of you spend $4.00 for a Latte and then complain because stamps go up 2 cents.  This is being pushed by the on-line people and if you think you are complaining now just wait.   I personally do not want all of my information floating all over cyber-space and am thankful that we have the postal service.   They are a self supporting business and we all should be thankful that we have something that the government is not supporting.   Instead it will be eliminated then someone with their hands out will be in line to take their place.   Or someone with barely a high school education will be handling all your confidential information.   Think before you are all on band wagon to get rid of postal service.  As for workers, the majority are hard-working people who do their very best every day to get your letters, magazines, etc to you.

Sounds like some of you are just jealous of the employees because it's such a good job.  Jealousy is an awful emotion to feel.

Karma is going to get you.

hey hank! Ever heard of people stealing mail from a mailbox? there is your hacking into paper...

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