UPDATE: October 1, 2010 -- The U.S. Postal Regulatory Commission on Sept. 30, 2010 denied the request by the Postal Service to increase postage rates effective January 2, 2011. (See full story...)
Faced with a projected $7 billion deficit and an ever-shrinking mail volume due to email, the U.S. Postal Service (USPS) has requested a postage increase officials say will "add less than 13 cents a month to the average American household's budget."
If approved by the Postal Regulatory Commission, the price of a First Class stamp will increase by 2 cents - to 46 cents on January 2, 2011. The price of a postcard would also increase 2 cents -- to 30 cents.
The postal service hopes this postage increase - the seventh in the last ten years - will generate about $2.3 billion in revenue for the first nine months of 2011.
According to Postmaster General John E. Potter, the proposed increase is just one of several solutions being pursued by the Postal Service to regain financial stability without placing an unreasonable burden on consumers.
"There is no one single solution to the dire financial situation that the Postal Service faces," Potter said in a press release. "These proposed rate adjustments are moderate and part of a fair and balanced approach to insuring mail service for all Americans well into the future."
Other cost-cutting measures proposed by the USPS last March include ending Saturday mail delivery, restructure the Postal Service retirement system, closing underutilized post offices and introducing more new mailing products.
Also See:
End of Saturday Mail Moves Closer
Will Congress Save Saturday Mail... Again?
Postal Service Loses Another $1.8 Billion
Comments
So, they keep raising rates, always with the same excuse of regaining financial stability. If the last six rate increases haven’t allowed them to do so, however, why will this one be any different? I’d really like to see genuine progress on the other solutions before simply raising rates again and again and again.
Well, all I know is that I can’t even drive across town and deliver a letter, proposal, legal papers, etc. for forty six cents. Let alone coast to coast and beyond. It’s still a good deal.
Melissa and Lynn make valid points. To the first I say why not get ahead of the curve instead of chasing it. Make a stamp 60 cents. As Lynn points out, it is a bargain. And if they cannot find the party on the other coast, they bring it back free. And despite the jokes, when is they last time they lost anything of yours. Finally, half their job has to be junk mail – get rid of it.
Why give the misleading, understated headline Obama tells Nasa to reach out to Muslims. In your breif story you say the reason was about getting money for the program. The way you wrote the headline is way too understated and could imply a host of other concepts.
The USPS could save a great deal of money if they temporarily used one first class stamp, either the American flag or the Forever stamp. The cost savings would be phenomenal. How many different styles of stamps do the American people need? Further, government businesses should have to pay postage, just like the rest of us. Also, look at expenses before raising rates and weed out expenses that could be postponed for a couple of years.
80% of my mail is “junkmail” Why don’t they increase rates on that and save a few trees?
Gary: Mine too, but the sad fact is that if the USPS loses the direct mail (junk mail) industry mailings, they are truly and quickly toast. The junk mail postage may be low, but the volume is… well, like you say, huge.
Robert
Seems to me that raising the price of a stamp only makes paying bills online and over the phone more appealing. Stamps are not COOL to a technology savvy generation. I think I buy one book a stamps a year – for Christmas cards. Everything else I pay online, pay in person, or send an email.
They could save millions by just delivering the mail during the week and not on Saturday. We don’t need mail on Saturday.
If they’re able to do all they do and charge as little as they do, I don’t begrudge them the postage and service fee increases they need to break even. Many people might be switching to e-mail and online payments, but millions of people and businesses still rely on the postal service. At the same time, I believe that within a decade USPS will no longer have sufficient reason to exist any longer. With their dwindling market share on the non-monopoly (first class and “junk” mail) services such as parcel delivery, at some point it will be time to turn it over to the private sector and be done with the old service.
USPS is very similar to all other government run entities I know of. It is top heavy with highly paid chiefs, their employees have entirely too much paid time off. The government will never change it ways of operation, ergo, they should privitise the postal service. Look at package shipping, UPS, FedEx and others have taken over the bulk of package shipping because they do it more efficiently, more cost effective to the shipper and they make a profit at the same time. To me, it is a no-brainer.
Unfortunately, Les, the removal of “junk mail” is what is putting a dampener on the postal service, because that is really where they get their revenue. I completely agree about getting rid of junk mail because I think it is a waste of trees. But being in the marketing business, I know it makes up the livlihood of many people and the bulk of the postal service relies heavily on the mail I deliver to the post office every day!!