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USPS Seeks to Cut 120,000 Jobs

August 12, 2011
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WASHINGTON, DC—The U.S. Postal Service (USPS) delivered a somber reminder of its dire financial circumstances with the revelation that it is considering cutting as many as 120,000 jobs from its 580,000-plus full-time employee ranks.

According to The Associated Press, the USPS also wants to pull its employees and pensioners out of the retirement and health benefits plans covering federal workers in order to set up its own benefits system. Having already maxed out its borrowing limit and enduring another year of $8 billion in losses, USPS has already indicated it will not be able to make a $5.5 billion payment to cover future health care costs, which is due Sept. 30.

The USPS is the only federal agency required to make such a prepayment; however, due to governmental accounting, eliminating the payments would make the federal budget deficit appear $5.5 billion larger. It has sought Congressional assistance for the past few years in an effort to eliminate or alleviate the prefunding requirement.
 
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