Stamps may go up to 46 cents

July 6, 2010

The U.S. Postal Service on Tuesday proposed a 2-cent increase in the price of a first-class postage stamp to 46 cents. If approved, the change would go into effect  Jan.2, 2011. [CNN]

The proposed rate hike underscores the deep financial hole the Postal Service is currently in, with a $7 billion deficit projected for next year.

Complicating the situation is the deep decline in mail being sent. In 2009, the amount of mail being sent declined 12.7 percent. Businesses are cutting back on their mailings and more and more people are communicating and paying bills via the Internet.

The Postal Service already announced a 50,000 job-reduction earlier this year.

Rates on packages and magazines are also expected to increase. The combined new revenue would be around $3 billion annually.

The Postal Regulatory Commission, which must approve the increase, had 90 days to issue a decision.

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As one who lives in a small town with no mail delivery, a PO that is only open 9am-4pm and closes for lunch 12-1pm, no stamp machines in the lobby and has computer glitches weekly. I am forced to go to the big city to buy stamps or have important mail stamped.

I have enjoyed the basic services since I was a kid, but it seems the PO is struggling to operate effectively and economically.

IMHO, most of the monetary whoas appear to be pension and salary related. Like all civil service or union jobs, they have a huge nut to come up with annually.

We are now where the Post Office enters it’s death spirial. They keep raising rates to compensate for loss. I understand the prinicipal in doing but that will drive more people to other means. Then the Post Office will be in more trouble and we go and start this process again.

I was talking to my Mom yesterday. Having always had mail her entire life, she said she wouldn’t be suprised to see the mail go away and morph into something else.

The only mail most people get now is Magazines and Newspapers, which both have issues of their own and are starting to move towards the internet. With Kindle and I-Pad that could solve some of that. Then about the only thing left is packages, which has competition form Fed-x and UPS. So the little that is left could be done maybe by a startup company that delivers on a two or three day as needed basis. Then the only thing left is junk mail. That gets a new name. SPAM. Problem solved.

I think in about the next ten to fifteen years at the most the Post Office will cest to exist. Just my humble opinion.