It’s no secret that the United States Postal Service (USPS) hasn’t been the model of financial health over recent years. Many people blame the electronic age on the fact that the USPS has been losing money recently.
This may be true, but it’s not the sole reason that the USPS has been on the negative side of the news.
The first thing to get out of the way is to understand how the post office works. Many think of the USPS as a government agency, so the simple thought is that if collecting postage doesn’t make up for the costs of running the USPS, the federal government could just give money to cover the difference. After all, what’s a few billion more dollars when you’re talking a trillion dollar a year deficit, right?
The fact is that the USPS is a self-funded government entity, meaning that it is required to cover all expenses with operational revenue. In other words, the government cannot simply allocate money from the annual budget.