The United States Postal Service continues to face a plethora of problems that will soon send it into default, reports 24/7 Wall St.
The USPS currently owes the US Treasury $5.5 billion, along with another $5.6 billion due in September. The money simply is not there, and the program will likely default on payment as early as this week.
An aging workforce is what seems to be the postal delivery giant’s biggest liability. The upcoming payments to the Treasury are earmarked for benefits for USPS employees that haven’t even retired yet, but they will be coming in fast. At current losses of around $25 million a day, a simple restructuring would not get this USPS out of its hole.
The only way to avoid paying the pensions would be bankruptcy.
Congress is not required to make the pensions whole. The USPS is required to do so, but that does not matter much if the red ink continues. The post office has not gotten permission to lay off tens of thousands of workers to balance its books. While it may seem impossible, the agency could solve its employment and pension problem, perhaps, by turning the issues over to a bankruptcy judge.