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The GOP Bankrupted the Postal Service On Purpose
And that’s not the only change coming down in 2013. The USPS will close half of its processing centers, close more than 3,000 local branches, and eliminate about one-third of its workforce — nearly 220,000 employees.
So it also won’t surprise you to learn that the delivery of first-class mail—like letters–by one to three days, making citizens less and dependent on the postal service and speeding up its demise.
Three Big Republican Lies
So why would the USPS take such drastic measures? Especially since the postal service is a basically sound business, though not without challenges like all businesses. If you look closely, you’ll see a concerted campaign to drive USPS out of business, despite the fact that it operates without government subsidies and, potentially, at a profit. It’s being subjected to a GOP- manufactured crisis in order to ram through drastic change. But without the USPS, citizens will face much higher costs without better service. Below, are three false impressions generated by the GOP propaganda machine:
Lie #1: The USPS’ losses show that it’s not a viable business.
In the last decade or so, the USPS has been dogged by two significant changes. The most obvious is the advent of email, which has hurt postal volumes, especially first-class mail. That’s a material change that’s never going away.
But the other change is the continued attempt by the GOP to privatize government services on behalf of the lobbyists who fund their campaigns (not to mention rid themselves of another of those “pesky” unions) and it imposes un-needed, no, dibilitating stress.
In 2006, the GOP-led Congress passed the Postal Accountability and Enhancement Act, forcing USPS to pre-fund the present value of 75 years of its pension and health-benefit fund in 10 years — about $5.5 billion annually for a business mandated to break even.
Like most people, if you listen only to the network headlines you might think the USPS is about to drop off the face of the earth. Yes, officially it sprayed red ink to the tune of $15.9 billion in 2012. But look below to see why. The reasons are not what you’ve been told.
Exactly $11.1 billion of that loss was due to the pre-funding mandate of the 2006 PAEA as shown above.
Indeed, the net losses look discouraging. But adjust them for pre-funding to see the actual operating situation instead of the deeply red figures hyped by most media outlets.
That 75-year pre-funding mandate adds significantly to the post office’s losses. This is a requirement that no other government agency, let alone a private company, must face. In short, the USPS is being forced to pay for people who aren’t even employees yet! Hell, some haven’t even been born yet!
In A League Of Their Own
On top of that, the USPS has been the model of responsible accounting. As of Feb. 2012, it had more than $326 billion in assets in its retirement fund, good for covering 91% of future pension and health-care liabilities. In fact, on its pensions, the USPS is more than 100% funded, compared to 42% at the government and 80% at the average Fortune 1000 company. In health-care pre-funding, the USPS stands at 49%, which doesn’t sound great until you understand that the government doesn’t pre-fund at all and that just 38% of Fortune 1000 companies do, at just a median 37% rate. The USPS does better than virtually every other business in the country.
Pre-funding is a burden that no other government-linked firms have to face, most notably defense companies. Lockheed Martin’s pension was underfunded by $13.3 billion as of Aug. 2012 — nearly half of its market cap. Raytheon’s was underfunded by $6 billion, more than one-third of its market cap, and Boeing’s by $16.6 billion, almost 30%. They have the luxury of profitability and time to fund their obligations.
Another significant advantage: Those other companies can invest in a wide range of securities, while the USPS is forced to invest in only government bonds–those bonds that, in some cases, pay less than 1% interest.
The cuts USPS is being forced to make are like making a millionaire eat leftovers thown out by fast food joints. The pre-funding mandate is completely ridiculous for a business that is mandated to break even. Where is the surplus cash going to come from, since it’s forbidden from making profits? In addition, this mandate forces USPS to cut investments in technology that would increase productivity and competitiveness, which would make USPS viable for longer. Even The GOP is not so stupid as not to see that its law creates an impossible burden.
They know full well what they are doing and to whom.
Lie # 2. Snail mail is dead, no way USPS can’t survive.
The USPS absolutely faces genuine business challenges. Revenue declined 3% from 2010 to last year, though USPS did hold the line on overall costs. And even though mail volume has declined with the rise of email, it’s still way more than 20 years ago, and certain segments, such as parcels, are actually growing.
Anecdotal evidence bears that out: Amazon.com, Zappos, eBay, are dead without efficient parcel delivery, but I now receive my bank statements via email.
One potential solution is to raise revenue. Currently, almost all revenue comes from the sale of postage. Why isn’t the USPS raising postal rates? Consumers already receive an extraordinary deal: Send a letter anywhere in the U.S. for a mere 46 cents. European rates near $1 to deliver on the Continent.
The Fix? Easy, allow USPS to price correctly.
Proper pricing is important for a business mandated to deliver everywhere from the big cities to a farm out in the middle of nowhere for a fixed price– a burden not faced by private services. Of necessity, many locations, such as rural ones, lose money — part of the price of a national postal service. Private services can simply leave a location if it’s not profitable. In fact, UPS and FEDEX rely on USPS to deliver to unprofitable locations for them already.
So why are FedEx and UPS continuing to do so well?
The short answer is that they can price postage to be profitable and invest in growth areas — both of which USPS is forbidden to do. And whenever USPS tries to enter a new arena, private competitors’ lobbyists run crying to Congress.
Need examples?
Plans to develop an online payment system in 2000? Internet industry lobyists killed it.
Public copy machines? Office supply stores lobbyists killed it.
In-store sales of phone cards and money transfers? Wal-Mart, Western Union, hell, who didn’t send lobbyists?
Selling postal meter cartridges? Pitney Bowes hired lobbyists to kill it.
And, of course, the big kahuna–rivals such as UPS complained, ultimately leading Congress in 2006 to restrict USPS to mail delivery…unless they needed help of course.
Myth 3. Privatized mail delivery would be cheaper and more effective.
This lie is classic GOP.
They always advocate privatizing no matter what the business. Anything to claim it’s unions that are strangling (your choice of service here). But USPS has continued to compete well as a business despite being constantly obstructed by a Republican Party backed by big money and determined to have its way, regardless of the harm to most of the public.
In particular, FedEx relies heavily on USPS, which delivered more than 30% of FedEx Ground shipments in 2011. To put it bluntly, the USPS provides service that is cheaper than what UPS and FedEx can provide for many locations. That’s an implicit subsidy.
As economist Dean Baker explains, “About a decade ago, the Postal Service had an extremely effective ad campaign highlighting the fact that its express mail service was just a fraction of the price charged for overnight delivery by UPS and FedEx. [They] went to court to try to stop the ad campaign. When the court told them to get lost, they went to Congress. Their friends in Congress then leaned on the Postal Service and got it to end the ads.”
So, if USPS is just government bloat, as The GOP would have you believe, then why would efficient free market players such as UPS and FedEx resort to the government? Shouldn’t they simply compete USPS out of that express business?
This paradox reveals in stark detail the delivery industry’s game plan and the GOPs complicity. Compete effectively where possible and then use political power to grab market share from USPS, with the ultimate goal of privatizing the postal system, or at least its profitable parts.
Only Two Possibilities For Where We’re Headed
Full privatization — a private company swallows the whole enchilada and operates delivery under some kind of regulatory oversight.
Partial privatization — a private company takes over the core infrastructure (a high-value, high-throughput distribution component), leaving less profitable and money-losing components such as labor-intensive physical delivery. This strategy is probably ideal since it privatizes the most profitable parts and sticks less desirable or money-losing bits to citizens.
Both strategies will likely result in much higher prices for less service. The first strategy means the acquirer adding a profit markup, which USPS currently cannot do under the law. The second strategy would not allow the USPS to offset less profitable areas with stronger areas, meaning government or citizens would be forced to cough up substantially more money to maintain service, and that’s on top of the buyer’s profit markup.
The privatization of public assets is something we’ve seen over and over and it rarely, if ever, works in favor of the public.With a strong profit motive, private companies are highly incentivized to cut service to the bone and raise revenues as fast as possible. That’s not in the interest of good public service, where the origins of the post office are.
Republicans, backed by big money sponsors, refuses to let the USPS act as a business. There’s no reason, apart from political will, that reasonable changes couldn’t sustain a public postal system even with its significant challenges.
So the next time you hear about the postal service losing billions of dollars or being unable to compete, remember how it got that way.
Your GOP.
MSNBC’s Al Sharpton And Touré Take On Roger Ailes’ ‘Lazy’ Racist ‘Dog Whistle’
The big “news” in Vanity Fair‘s excerpt of an upcoming Roger Ailes biography seems to consist mainly of the shocking revelation that “Newt Gingrich is a prick.” On Wednesday night’s PoliticsNation, however, Rev. Al Sharpton and The Cycle host Touré highlighted Ailes’ remark that President Obama is “lazy,” and were, in my opinion, mighty charitable in doing so.
Rev. Al began the segment by setting up the passage from the Vanity Fair excerpt in which Ailes calls the President “lazy.”
“He’s one of the most powerful voices in the country,” Rev. Al said, “and he’s attacking President Obama. Quote, ‘Obama’s the one who never worked a day in his life. He never earned a penny that wasn’t public money. How often does he play basketball and golf? I wish I had that kind of time. He’s lazy, but the media won’t report that.’ That’s the president of Fox News calling the President of the United States lazy.”
The Rev then played some awesome prime cuts of racial tromboning from the likes of Mitt Romney* surrogate John Sununu, and an extended riff by Newt Gingrich that I had completely forgotten about. “I’m assuming there’s some rhythm to Barack Obama that the rest of us don’t understand,” Gingrich says. “Whether he needs large amounts of rest, whether he needs to go play basketball for a while.”
Rev. Al and guest Touré generously referred to the whole mess as “dog whistles.”
“This sort of ‘lazy’ term is something we heard flung at us as black people going back to slavery,” Touré said, “which, of course, you know, we perceive them as being guilty of not wanting to work. Of course they didn’t want to work. They were slaves.”
“But they did work,” Rev. Al said.
“But this is a revolutionary thing that they’re doing,” Touré continued, “saying ‘We’re going to get out of all of the work that we can,’ and then this stupid idea follows us since then. It’s this really disgusting, accessing stereotypes, red meat sort of dog whistle. On the Fox side of the aisle, they say yes, that’s right. This is what we think of black people already. And, on our side, we’re like ‘What are you talking about?”
Rev. Al and Touré also accused Ailes’ of blowing more than a “dog whistle,” but of making a comment that was just false. President Obama has been an attorney, a constitutional law professor, and a community organizer. Rev. Al noted a possible reason for obscuring those facts. “Another subtle thing is ‘lazy and never earned anything other than public money’, which is almost like welfare,” he said, before comparing the 84 days of vacation that President Obama has taken since assuming office, versus the 250 days George W. Bush took in the first three years of his presidency.
Rev. Al went on to note the restraint he felt he was showing. “And I’m being real nice about it,” he said. “I’m trying to not be like the big guy over at the echo chamber going crazy at the show.”
Sharpton stopped reading that excerpt before he got to Ailes’ tell: (emphasis mine)
“Obama’s the one who never worked a day in his life. He never earned a penny that wasn’t public money. How many fund-raisers does he attend every week? How often does he play basketball and golf? I wish I had that kind of time. He’s lazy, but the media won’t report that.” He noticed my arched eyebrows and added, “I didn’t come up with that. Obama said that, to Barbara Walters.”
What President Obama described to Barbara Walters, as author Zev Chafets described in the passage, was “that he feels a laziness in himself that he attributes to his laid-back upbringing in Hawaii.” He also told Walters that he made that critique despite “all the work I do.”
To Ailes, though, that bit of introspection is apparently a license to call the first black president lazy, which is fine, if you’re prepared to stand by that. Given the racist history of that particular stereotype, expressed with that specific word, you should be prepared to make your case that this guy really is lazy. Confronted with Chafets’ “Damn, that’s racist” arched eyebrows, Ailes ducks behind: “Hey, he said it.”
If this were truly a neutral observation about a truly lazy president, Ailes could have said “What? He is lazy, and here’s why.”
The real irony is that Ailes uses President Obama actually playing basketball as an example of “laziness,” while Chafets’ fawning excerpt opens with an extended anecdote about Ailes watching a basketball game, then taking a limo back to his office.
Here’s the clip, from MSNBC’s PoliticsNation:
Morning Joe Impressed By Rand Paul’s ‘Spontaneity,’ Filibuster Espousing View That ‘Wasn’t Popular’
Sen. Rand Paul‘s old-fashioned, speak-for-as-long-as-you-can filibuster of John Brennan‘s confirmation to become CIA director garnered widespread attention on Wednesday. Not too long after it ended (just before 1 a.m.), the Morning Joe crew weighed in on the nearly 13-hour stand, which focused President Obama‘s drone program and civil liberties. And they were impressed.
“Last night, spontaneity broke out, and you could see someone on the floor who wasn’t doing something that was poll-tested and market-driven,” Joe Scarborough asserted. “Whether you’re a liberal or conservative watching Rand Paul, I think you had to kind of admire the guy for really going out there and fighting for what he believed in.”
Steve Rattner agreed. “He had a point of view,” he said, “And it wasn’t popular.” But Paul still had the conviction to go out and voice his concerns. With that, Scarborough and Willie Geist pointed to the fact that Paul found himself with some bipartisan support; the encouragement wasn’t only from fellow Republicans.
“If you wanted to shine a light on this issue, what better way to do it?” Geist asked. “He shined a light perhaps just for a day but a lot more people today know about it than they did yesterday, about the question of whether or not the United States can use drones against its own citizens.”
That question is a valid one, the panel agreed, and one that merits discussion. Also paying a nod to Sen. Ted Cruz‘s confrontation with Attorney General Eric Holder yesterday, Scarborough then turned to Kelly O’Donnell to return to the topic of Paul specifically.
O’Donnell noted that while Paul did get some breaks when other senators joined to speak and ask questions, it was still a taxing ordeal for him. “People respected the effort in that,” she said, adding that the topic was “A very narrow issue.”
It’s “an interesting constitutional argument,” she added. And it certainly got a lot of attention yesterday.
Take a look, via MSNBC:
Rand Paul Yields The Floor, Ending Nearly 13 Hour-Long Filibuster Over Obama’s Drone Strikes
After nearly 13 hours of filibustering, Sen. Rand Paul (R-KY) finally yielded the floor, putting an end to his historic protest against the administration’s lack of answers on its authority to execute targeted assassinations of American citizens abroad and on U.S. soil.
Sen. Paul began his filibuster of Obama’s CIA pick John Brennan at 11:47 a.m. ET Wednesday and wrapped up at 12:39 a.m. Thursday morning. Upon conclusion, Republicans present in the Senate applauded for their colleague’s efforts in bringing awareness to the administration’s executive overreach.
The Senate session will resume at 10 a.m. Thursday morning, and a vote is likely to follow.
During the half-day-long filibuster session, Paul was joined by fellow Republican Sens. Ted Cruz (R-TX), Marco Rubio (R-FL), Saxby Chambliss (R-GA), Mitch McConnell (R-KY), and Mike Lee (R-UT). Despite his support for Brennan’s CIA nomination, Sen. Ron Wyden (D-OR) joined the effort, voicing his concerns about the Obama administration’s authority to assassinate American citizens without congressional oversight.
Despite the filibuster yielding no official acknowledgement from the administration, Sen. Paul’s office claims to have been in contact with the White House throughout the day and expects a response Thursday morning.
Watch Paul conclude his filibuster below, via C-SPAN2:
New York National Rifle Association official barred from carrying a gun
A top National Rifle Association official in New York no longer has the right to bear arms.
Richard D’Alauro, the NRA’s field representative for the city and its suburbs, is forbidden from owning guns under an order of protection stemming from a confrontation with his wife in their Long Island home, the Daily News has learned.
Suffolk County authorities filed misdemeanor charges of assault and endangering the welfare of a child and a noncriminal charge of harassment as a result of the domestic dustup, which occurred at 1:55 a.m. on Sept. 1, 2010, records show.
At the time, the police confiscated a whopping 39 pistols, shotguns and rifles that D’Alauro kept in the couple’s East Northport, L.I., home.
-snip-
Source: NY Daily News
Colbert Busch Highlights Business Experience In First Campaign Ad
Elizabeth Colbert Busch, a Democratic candidate for U.S. House in South Carolina’s First District and the sister of comedian Stephen Colbert, hit the airwaves on Thursday in her first campaign ad that touts her experience as a job creator.
“You always hear about the jobs that we lose to foreign trade. I’m Elizabeth Colbert Busch, and from intern to director of sales and marketing at a shipping company to the director of business development at the former Naval shipyard, I’ve spent 20 years using our ports to create jobs selling American products made by American workers,” she said in the spot.
-snip-
Source: TPM
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Rand Paul is Cordially Invited to Kiss My Ass
Rand Paul has been droning on about drones for 7 hours. In that time, he could have introduced a damn bill that would repeal the AUMF, which is the reason motherfuckers are freaking out that the Black Dude in the White House is going to drone strike them in the Whole Foods parking Lot.
Rand Paul won’t take the time to introduce a bill to repeal the AUMF (because that would require him to put his money where his pie hole is), but he WILL take the time to try to attach a Personhood Amendment to a fucking flood insurance bill. That’s right. A personhood amendment. To a fucking flood insurance bill.
Oh, and while he quotes Glenn Greenwald and and feigns outrage about drone strikes, he enthusiastically supports the Stand Your Ground laws that are the direct cause of the deaths of so many black people in this country — like Trayvon Martin and Jordan Davis.
If he gave a true fuck about drone strikes? He would try to change the goddamn AUMF. But he’s not. He’s filibustering Brennan’s appointment. It’s political kabuki theater, and it’s horseshit . . .
Source: The Angry Black Lady Chronicles
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