Stock up on stamps while they’re cheap because on January 29th of 2019 the price of a one ounce letter stamp is going to jump.
Stamp prices will increase from 50 cents to 55 cents per stamp, the largest single increase in stamp prices in USPS (United States Postal Service) history.
The price increase comes at a critical time for the USPS. The government-owned business has been operating at a loss for the last 12 years. For the fiscal year ending in September 2018, the Post Office posted an operating loss of $3.9 billion.
The USPS has also defaulted on its obligation to prepay $6.9 billion to the government this year in pensions and health benefits for retirees. It is the only government agency required to prepay its pensions, an obligation which its leadership deems unfair, and it has defaulted on this payment every year since 2012. The Chief Financial Officer of the USPS, Joseph Corbett, explained the burden of such prepayment obligations.
“Making the pre-funding payments in full or in part would have left the Postal Service with insufficient liquidity to ensure the continued achievement of our mission,” he was quoted as saying in the Postal Service’s Fiscal Year-End Report.
Last April, by Executive Order President Trump enlisted a task force to audit the Postal Service and make recommendations on how the business can end its streak of operating losses. The force, led by the Treasury Secretary Steven Mnuchin, has already made its recommendations to the White House. The five cent price hike is likely one of its recommendations, but it’s currently unknown since the task force’s recommendations are being kept a secret from the public until the dust has settled from the midterm elections.
It is unclear why.
The Office of The President also unveiled a massive restructuring plan in June called “Delivering Government Solutions In The 21st Century,” which included plans to prepare the Postal Service for privatization.
The USPS has been considered a social service under the purview of the federal government ever since Benjamin Franklin was named the first Postmaster General in 1775.
Privatization could allow the Postal Service to lower its cost structure, but many fear that by acting as a profit-maximizing entity rather than a social service, the USPS will disproportionately neglect the lowest rung of the socio-economic ladder. The President’s plan cited the, “universal service obligation that is understood to require mail carriers to visit over 150 million addresses six days per week,” as one of the challenges that could be removed if the agency were privatized.
Whoever described this “obligation” obviously never lived in Mammoth Lakes.
If the Postal Service were to discard this obligation then the first group to lose their delivery service would likely be the rural poor, those in locations where it is more costly to have a post office than it’s worth.
For a President who views aggressive tax preparation as an act of citizenship, the idea of postage as a social right may be too confusing. Many people voted for the ratings machine, DJT, because they wanted him to run the government like a business. Now they may get their wish. If it turns out they regret their decision they can just vote him out by mail next … oh wait.
Other changes to the stamp pricing system include an increase to the price of all flat rate boxes and envelopes by between 6% and 10% depending on the box, and an decrease in price-per-ounce in excess of 1oz for first class letters from 21 cents to 15 cents.
The price of a postcard stamp will remain 35 cents.