The head of the U.S. Postal Service warned lawmakers that the agency is at a “critical juncture” and could run out of cash in less than a year without changes.
Testifying before a House panel, Postmaster General and Chief Executive Officer David Steiner cited several factors behind the financial strain, including declining mail volume and a statutory requirement to deliver mail six days a week to every address in the United States.
"If you want the same level of services that we have today—six-day-a-week delivery and 33,000 plus post offices, we can do that, and we are glad to do that," Steiner said. "But someone has to pay for it, and the only options are postal ratepayers or taxpayers."
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Steiner noted that the U.S. pays far less than other countries to send mail. The current price of a first-class stamp is 78 cents, but he suggested it could rise to as much as 95 cents.
"If we were to change the stamp price to 90 to 95 cents, which is still less than half of the cost of most foreign posts, that would largely solve our controllable loss," he said. "And the stamp price would still be the lowest in the industrialized world by a lot."
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The Postal Service has been working to cut costs and improve efficiency to make up for years of losses, but Steiner said those efforts alone will not resolve the agency’s financial challenges.
He also warned that the agency is nearing its statutory borrowing limit, which restricts how much it can borrow from the Treasury and further limits its ability to manage cash shortfalls.
No final action was taken during the hearing, but lawmakers will likely be forced to consider a range of options to address the Postal Service’s financial outlook.
