Is The Us Postal Service Affected By The Shutdown

The merits: The The states Post volition shut down by June and be replaced by corporate partnerships.

Amid the economic fallout from the COVID-xix pandemic, an already beleaguered U.s.a. Mail faces a daunting financial situation while rumors spread about the agency'due south potential shutdown.

On Apr 5, a Facebook user shared a post claiming that the USPS would shutter in June. The post, which also describes secret plans by major corporations and the federal government to capitalize on USPS's demise, has been shared over 250 times.

"All packages and bulk items will now be picked up at your home or place of business by Fed-Ex, the small items volition be taken by you to ...Wal-Mart. What? You tin can't mail packages at Wal-Mart? Not nonetheless...." the mail service alleges.

Specific claims about how workers will be treated in the prospective layoffs are also made, including that "All the 600+ yard current employees will be given a one year's severance package with one year's benefits. Those employed for 20+ years will exist given no retirement parcel."

The Facebook user did non respond to a asking for comment.

The post also cites a Fortune story that details alarms raised by some officials about the wellness of the Postal Service. "With a negative net worth of $65 billion and an boosted $140 billion in unfunded liabilities, the USPS originally expected to run out of liquidity by 2021 without intervention," the story reads.

"That has accelerated apace because of COVID-xix. Fewer people and businesses are sending postal service because of the outbreak, which could hasten the reject of the Postal Service and close its doors every bit early equally June, officials warned."

The finances of the USPS and COVID-nineteen

The United states of america Postal Service was already pain financially before COVID-19 ravaged the economy. The agency, which relies on fees rather than taxpayer funds to finance itself, has seen rise net losses in revenue for over a decade.

The coronavirus pandemic has exacerbated the trend, with lawmakers and USPS officials raising alarm. According to reports from the agency, the total book of mail delivered during the calendar week of March 29 is downward a quarter from the same time in 2019. While deliveries of packages were upwardly eleven.7% over the same period, the acute losses take raised concerns.

"Equally the Postal Service continues to spend resource in response to this crisis, the national refuse in economic activeness has led to a rapid drib in mail volumes and a pregnant loss in needed revenues, which puts our ongoing ability to provide our vital federal service at gamble," U.South. Postal Service spokesman David Partenheimer said in a statement to USA TODAY.

Mail carrier Jasmine Armstrong wears a mask while delivering the mail in Peekskill, N.Y. March 23, 2020. Armstrong says the the postal service supplies gloves and a mask, and she is maintaining the recommended six feet from others in order to avoid being exposed to the Covid-19 virus.

The price of delivering mail has also risen: The agency is bearing the price of equipping its workers with personal protective equipment like masks and gloves equally they continue to operate amid a global wellness crisis.

"There is no question that the postal service role at the national level has put serious effort into protecting the health and safety of workers during this exceptional fourth dimension," said Mark Dimondstein, president of the American Postal Workers Union, which represents over a 3rd of USPS's 600,000 employees. "But the mail service office has to fund these provisions out of its existing funding," he cautioned.

"Information technology has become articulate that the Postal Service will not survive the summertime without firsthand help from Congress and the White House," a March 23 argument from Reps. Carolyn B. Maloney and Gerry Connolly reads. The press release also notes Postal Service officials have warned that without aid it "could be forced to end operations as early as June."

"We will keep to work with policymakers in the months alee to ensure that Americans have access to the mail during this critical time in our nation's history," they continue.

The agency reported a loss of $748 million in the first quarter of 2020, citing "systemic profitability challenges due to our restrictive business model and mandated costs." USPS also reported a loss of $8.8 billion in fiscal year 2019, which was itself nearly more than than double its losses for the year prior.

"Nosotros now estimate that the COVID-19 pandemic volition increase the Postal Service's net operating loss by more than than $22 billion over the next 18 months, and by over $54 billion over the longer term, threatening our ability to operate," said Megan Brennan, the Postmaster General and CEO of USPS, in a statement Th.

"The ask of the postal board of governors, the postal unions and even major mailers is very specifically requesting that Congress address the huge negative impact that this pandemic is having," Dimondstein said of the situation, adding that without relief the agency would not be able to finance operations or compensate workers.

The agency has not announced it volition cease operations. A liquidity crisis, or lack of on-hand greenbacks, would hamstring the bureau'south ability to function and probable lead to a far higher debt burden.

The postmaster general's own comments imply that such a crisis would forcefulness the USPS to infringe heavily to finance itself. While debilitating, especially without intervention from the federal government, that state of affairs does not automatically mean the Usa Postal Service would be forced to shut downward considering of its troubles.

"Equally Congress and the Administration accept steps to support businesses and industries effectually the country, it is imperative that they too take action to shore upwards the finances of the Post and enable us to continue to fulfill our indispensable part during the pandemic, and to play an effective part in the nation'southward economic recovery," Brennan also said of the Postal Service's situation.

No private takeover

USPS denies claims that private companies are expected to take over operations from the bureau.

"Predictions of the Postal Service'south imminent plummet are dramatically overstated," said Michael Plunkett, president and CEO of the Association for Postal Commerce, an advocacy group for the mail industry.

"Individual-public partnerships are already a prominent feature of the US postal system. Our members produce, ship sort, and track mail service on behalf of their concern clients and piece of work closely with the Postal Service," Plunkett added.

FedEx declined to comment on its corporate development activities, still, said information technology "has long supported reforms that would requite the U.Due south. Mail service the ability to adapt and prosper in a rapidly changing market with ever-shifting customer needs," in a argument to U.s. TODAY.

Walmart did non answer to requests for comment.

The U.S. Mail has been designated every bit an essential service in emergency orders across the country. The $2 trillion stimulus package enacted by the federal government to ease economic fallout from the virus included a $10 billion loan to the USPS, though in that location was no direct funding.

On Thursday, the Postal Service Board of Governors requested Congress approve $75 billion to the USPS through a mix of direct cash, grants and loans that would exist used for alleviating the current crisis and upgrading aspects of the agency.

Our ruling: False

The coronavirus pandemic has seriously impacted the financial stability of the U.S. Postal Service, to the indicate that the agency is expected to run out of cash on hand former this summertime. Information technology is unlikely, however, that whether without intervention the agency would shut down completely. Experts and advocates shut to the industry, while cognizant of the urgency of the state of affairs, are skeptical of closure. Claims that private firms will take over the agency'due south operations are as well baseless. We charge per unit this claim Simulated because it is not supported past our research.

Our fact-bank check sources:

USA TODAY, Trump signs $two trillion coronavirus stimulus intended to halt economic meltdown
Mar. 23 Statement from Reps. Connelly and
USPS Statement on COVID-nineteen
USPS Financial Report for FY19
USPS Statement on First Quarter Finances for FY20
Government Executive, USPS Requests $75B in Emergency Funds to Go on Agency Alive

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