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‘In Blow To Privatizers,’ House Passes Postal Financial Relief - Bipartisan Bill Would Ease Financial Challenges That Critics Have Used ‘To Justify Calls For Postal Worker Wage Cuts & Selling Lucrative Parts Of The Service To For-Profit Corporations’

Published Tuesday, February 11, 2020
by Sarah Anderson & Brian Wakamo/Inequality.org
‘In Blow To Privatizers,’ House Passes Postal Financial Relief - Bipartisan Bill Would Ease Financial Challenges That Critics Have Used ‘To Justify Calls For Postal Worker Wage Cuts & Selling Lucrative Parts Of The Service To For-Profit Corporations’

(WASHINGTON, D.C.) - The House has voted to remove a financial albatross around the neck of the U.S. Postal Service.  Approved by a vote of 309 to 106, the USPS Fairness Act would repeal a 2006 Law that requires the U.S. Postal Service (USPS) to create a $72 billion fund to pay for the cost of its post-retirement health care costs, 75 years into the future.

This extraordinary mandate, which applies to no other Federal Agency or private corporation, created a financial “crisis” that has been used to justify harmful service cuts and even calls for postal privatization.

These reforms would be devastating for millions of Postal Workers and customers, particularly in heavily Republican rural areas.

Eighty-seven House Republicans supported the Bill, which now moves to the Senate, where Montana Republican Senator Steve Daines has introduced a companion Bill - S.2965.

Without the costs of this retiree health care mandate, the Post Office would have reported operating profits every year between 2013 and 2018.

A Trump Task Force on the Postal Service confirmed this in a December 2018 report.

Allowing the USPS once again to pay the costs of retiree health care costs on a pay-as-you-go basis - as the rest of the Federal Government and two-thirds of private industry currently do, is the biggest step that could be taken to assure long-term financial sustainability.

Current reserves of $47.5 billion could be used to pay expected pay-as-you-go retiree health care costs 10-to-15 years into the future.

The Trump Task Force report opposed the repeal of the current rules related to Postal Retiree Health Benefits, calling them “part of a mandate for postal self-sustainability.”

However, the Task Force also recognized that the aggressive and accelerated timetable for funding the mandate has proved unworkable.

They called for past deficits to be “restructured with the payments re-amortized with new actuarial calculation based on the population of employees at or near retirement age.”

While this would have a modest positive effect by spreading payments over a longer period of time, it would do little to address the underlying problem caused by the USPS being burdened with a mandate that no other Federal Agency or private corporation faces.

Last week’s House vote to completely repeal the pre-funding mandate provides a ray of light for a strong future for the USPS and helps set the service on a path to sustainability.

As Bill champion U.S. Representative Peter DeFazio (Democrat-Oregon) put it, it’s time “at long last to undo this stupidity.”

To Continue Reading This Labor News Report, Go To: https://inequality.org/great-divide/usps-fairness-act-passes/?fbclid=IwAR3C3imGk5C3UBLH7nLCmT_9390Bz1lOxVrgisPdoTMTnShxDR3jF_dqDNg

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