USPS will run out of cash in early 2027 without help: Postmaster general |
USPS will run out of cash in early 2027 without help: Postmaster general
The U.S. Postal Service (USPS) will run out of money within a year, Postmaster General David Steiner told The Associated Press this week.
“We have to have a conversation with the American public,” Steiner said in an interview with the AP published Thursday. “If you want us to deliver everywhere, every day, we’ll do it. That’s not a problem. But who is going to pay for it?”
Funding the Postal Service relies on whether Congress votes to lift a $15 billion cap on the agency’s borrowing allowance, which has been in place since 1990, Steiner told the AP. Congress’s decision will impact the Postal Service’s ability to pay its workers and vendors who could be out of a paycheck come February 2027 and thus impact mail delivery nationwide.
“How long are employees going to work and vendors going to show up if we’re not paying them?” Steiner said during the interview. Steiner stepped into the role of postmaster general amid financial struggles at the agency last July. The Postal Service reported a $3.3 billion net loss during the quarter just before Steiner stepped into the role, a doubling from the same period the previous year. In November, it reported a net loss of $9 billion, a slight decrease from the $9.5 billion of net losses it reported the previous year. USPS’s total operating revenue increased to $80.5 billion for the year, which the agency attributed to its Ground Advantage shipping service.
In its 2025 results, the Postal Service said it was seeking administrative and legislative reforms “to remedy outdated and unwarranted financial and regulatory burdens.” It listed reforms including changes to retiree pension benefit funding rules, diversification of pension assets, raising the statutory debt ceiling and workers’ compensation.
Trump threatened to take over the independent agency last February by potentially putting it under the Department of Commerce. Under former Postmaster General Louis DeJoy, the agency signed a deal with the Department of Government Efficiency last March to cut jobs and spending at the USPS in an effort to reduce costs.
Steiner is scheduled to testify in front of Congress later this month on the agency’s financial losses and his ideas to make reforms to decades-old legislation, which he sees as limiting to the agency’s success.
Steiner emphasized in his interview with the AP that the most efficient and immediate way to properly fund the Postal Service is for Congress to lift the borrowing cap.
“That will buy us the time to make the fixes we need to make, and we can sail on down the road,” Steiner told the AP.
He also said Congress should give the agency the authority to raise postage stamp prices, which would help limit borrowing needs. He told the AP that raising the cost of stamps from 78 to 95 cents would “fix” the financial struggles of the agency.
“If the Postal Regulatory Commission adopted our pricing model, problem solved,” he said in the interview.
In 2022, lawmakers passed the Postal Service Reform Act which eliminated a former requirement for the agency to prefund retiree health benefits. But with more people communicating and paying bills through the Internet, the annual volume of mail the Postal Service is managing has dropped from 220 billion to 110 billion, impacting its revenue.
“Take those 110 billion and put a 78-cent stamp on them. That’s $86 billion of revenue that evaporated in 15 years,” he said in conversation with the AP. “If either FedEx or UPS lost $86 billion of revenue, they would have no revenue.”
Steiner said that instead of helping, lawmakers have imposed “costly mandates.”
“I like to say we sort of got thrown overboard on a ship into the cold water, right? And instead of throwing us a life preserver, we get thrown an anchor.”
He also told the AP he didn’t understand the scale of the financial struggles of the Postal Service until he stepped into the role of postmaster general over the summer.
“Interestingly, I’m not sure some of the people at the Postal Service realized how dramatic it was,” Steiner said.
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