Postal Service Needs ‘Dramatic Action’ From Obama, Carper Says

President Barack Obama should take “immediate and dramatic action” to save the U.S. Postal Service from insolvency, Senator Thomas Carper, a Delaware Democrat, told him in a letter.

The service, which says it will run out of cash within a year without relief from laws governing it, must make changes akin to what the U.S. auto industry did two years ago, Carper said yesterday in a letter to Obama. The service needs help from the White House to do so, wrote Carper, the chairman of a Senate subcommittee overseeing the service.

Obama proposed two postal changes in his budget this year and has since left the debate to Congress. Carper said he expects the administration to send a proposal “in the coming days” to a 12-member congressional committee charged with coming up with a long-term deficit plan.

“While the situation is dire, it is not hopeless,” Carper wrote in the letter. “Like the American troubled automobile manufacturers did as they faced a crisis that threatened their survival, the Postal Service needs to rightsize to reflect the changing demand for the products and services it offers.”

Carper asked Obama to allow the Postal Service to end Saturday mail delivery, sell more products and services, get a refund of overpayments to federal retirement programs and to restructure mandated payments for health-benefit costs for future retirees.

One Week’s Cash

Carper, who is sponsoring a bill to allow the Postal Service to make the changes he suggested, sent his letter two days after Postmaster General Patrick Donahoe told a Senate panel his agency is operating with a week’s worth of cash and increased the loss forecast for the fiscal year ending Sept. 30 to $10 billion.

The service is trying to close post offices and processing plants, cut the number of employees and end Saturday delivery. Carper said moving to five days of delivery from six “would be especially necessary if the Postal Service is unsuccessful in working with its two letter-carrier unions during the collective bargaining process in the coming months in making Saturday delivery more cost-effective.”

To contact the reporter on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

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