Postmaster General Patrick Donahoe, said Thursday, that the Postal Service may need an emergency postage rate increase.
Donahoe warns that the post office’s cash liquidity is running low and that it is set to lose $6 billion this year. He claims that he may need the emergency postage rate hike because the agency’s finances are uncertain and congressional action concerning the issue may not be quick. The post office isn’t allowed to increase its rates more than what inflation increases without permission from the Postal Regulatory Commission. Lawmakers are considering cutting cost to the post office by ending Saturday delivery as well as door-to-door delivery. The Postal Service is also looking to reduce its annual payments for future retiree health benefits as well as being allowed to ship alcoholic beverages, which would allow it to compete with other delivery services like FedEx (FDX), reports the Associated Press.
In an effort to cut cost, the Postal Service has already cut 200,000 jobs and eliminated 21,000 mail routes.
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