Should we expect USPS to make money?
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What financial crisis is the USPS currently facing?
Should we expect the Postal Service to make money? For Marketplace, I'm Nancy Marshall-Genzer, in for David Brancaccio. The Postal Service says it's facing a severe financial crisis. Postmaster General David Steiner testified before a House subcommittee this week. He said the USPS was struggling and could be out of cash in less than 12 months unless something changes. Marketplace's Carla Javier has more.
How much money did the USPS lose last fiscal year?
The USPS says it lost $9 billion last fiscal year.
I remember when the average losses were $4.5 or $5 billion, but now the losses are increasing over time.
That's Rick Geddes at Cornell. On the cost side, he says USPS has a universal service obligation.
It's basically to deliver the mail to every address it can, six days a week. And that can get expensive. to have all the trucks run six days a week, to have the carriers who walk their routes.
On the revenue side, lawyer and consultant Jim Campbell says letter volume has gone down precipitously, and legislation limits the Postal Service's ability to raise prices. So a combination of the price cap and the declining volumes hit the post office quite hard. The Postmaster General said Congress and the USPS could consider reducing the days of delivery, closing offices in rural or remote areas, raising stamp prices to a dollar or more, or significant financial reforms. But with revenues unlikely to exceed costs, James O'Rourke at Notre Dame says Congress has to decide if it wants a postal service at all.
We don't ask the Forest Service or the Weather Service to make money. They are a service to the people of the United States. It would be nice if the Postal Service could break even or at least come close.
But that, O'Rourke says, would take some heavy lifting on Congress's part. I'm Carla Javier for Marketplace.
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The war in the Middle East is taking an economic toll on Americans. That includes the American farmer, who's dealing with higher diesel and fertilizer prices. Marketplace's Elizabeth Troval has more on how the war is affecting agriculture.
It's planting season for a lot of American farmers, which often brings renewed optimism about the upcoming year's harvest. But when I asked rice farmer Casey Smith about his outlook for this year...
Honestly, I don't feel very positive about it.
We're standing in his newly planted rice crop in Brazoria County, south of Houston. The green blades of the rice plant are about three inches high in straight rows across the dirt.
It's honestly nerve-wracking. We put a very large sum of our own money into the crop last year, and we didn't get any nickel of it back. So it's very concerning.
He worries about the tens of thousands of extra dollars he's likely going to have to spend on his farm, with the 25% or so jump in his fertilizer price and diesel prices surpassing $5 a gallon since the war started less than three weeks ago.
We already had this planted when that happened. You know, it happened afterwards. So what do you do now? You know, it's out of our control. We have zero control and there's zero chance that our yield will make up that extra expense. There's zero chance.
Further north in the Texas panhandle, D. Vaughn grows corn, grain sorghum, wheat and cotton.
We are second generation Texas farmers. My grandparents farmed in Oklahoma.
He'll plant his corn, cotton, and grain sorghum later this spring. He's also concerned about how the increased cost of fertilizer and diesel will hit his bottom line.
I have no way of passing the cost off. Our corn is priced in a global marketplace. I just have to take it on the chin that way.
He says he may cut back on using fertilizer or delay repairing or replacing some of his equipment.
You just have to kind of roll with the punches.
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