Future Retiree Health Costs Driving Postal Service Toward Default
In addition to this initial payment that is quickly coming due, a second hefty amount is due to the Treasury Department in September.
The Washington Post: Postal Service Set To Default On Payment
Postal officials said Monday that without close to [$5.5 billion] in the bank, they can't make the payment, which is part of a 10-year plan to set aside health benefits for retired postal workers. Another bill for roughly the same amount is due in September, but it will likely meet the same fate (Rein and O’Keefe, 7/31).
The New York Times: As Default Looms, Postal Service Sees Deeper Woes
But even if the post office were to get these changes from Congress, including eliminating Saturday delivery and the multibillion-dollar payments on future retiree programs, the agency would still be losing money, it said. Since 2007, it has lost $25 billion — $20 billion of which is attributable to the payments for future benefits, required by law since 2006 (Nixon, 7/31).