Treasury agrees to lend Postal Service $10 billion in trade for rivals' shipping contracts

[mahatmakanejeeves]

Source: Washington Post

Economy

Treasury agrees to lend Postal Service $10 billion in trade for rivals' shipping contracts

The debt-laden mail service will provide the agency proprietary information on its agreements with private-sector competitors

By Jacob Bogage
July 29, 2020 at 12:36 p.m. EDT

The Treasury Department agreed to loan the U.S. Postal Service $10 billion in emergency coronavirus relief funding on Wednesday in exchange for proprietary information about the mail service's most lucrative private-sector contracts.

The Postal Service, subject to confidentiality restrictions, will provide Treasury copies of its 10 largest "negotiated service agreements," or contracts with high-volume third-party shippers such as Amazon, FedEx and UPS, and receive a crucial injection of cash that postal officials say will keep the debt-laden agency solvent for at least another year, according to a copy of the loan's term sheet obtained by The Washington Post.

The Postal Service contracts with private-sector shippers for "last-mile" delivery from distribution centers to consumers' homes, and it offers those firms small discounts because of the volume of packages they provide.

{snip}

Jacob Bogage
Jacob Bogage writes about sports for The Post, where he has worked since 2015. He previously covered the automotive and manufacturing industries for the Business section. Follow https://twitter.com/jacobbogage

Read more: https://www.washingtonpost.com/business/2020/07/29/postal-service-treasury-loan/

[Evolve Dammit]

1. Can any good come of this? Sounds like selling your seed corn..

[soothsayer]

2. What quid pro quo is this

[muriel_volestrangler]

8. Trump wants to say Amazon gets a special deal, and therefore the Washington Post is evil

because Bezos owns them both. Whether Amazon's deal is actually better than anyone else's will be irrelevant for the purposes of Trump's propaganda; he just needs an excuse to tell his potential voters to assume anything in the WP is anti-Trump. He just needs to fool them until November.

[soothsayer]

15. I feel it's more than that. He can already just say that -- and does

There’s an angle here.

[Kingfisher86]

3. The Trump administration really don't like Amazon, eh? n/t

[rurallib]

16. well, the Washington Post and by extension Bezos and Amazon

[Grins]

20. If I was Jeff Bezos...

I'd drop a couple of billion $$ into this election, to include every Senate election, every close or leaning House election, every election vs. an incumbent Republican Governor, and every state where judges are elected to state courts.

$2-$3 billion? He wouldn't even notice it missing and he will recover all of it in less than a year, anyway. But the personal satisfaction in taking down Trump and the GOP - PRICELESS!!!!

[cstanleytech]

22. He won't though as overall the GOP is beneficial to Bezos so instead he will build his own delivery

service which is what he is doing.

[Ford_Prefect]

4. I suspect this doesn't end well...

[George II]

5. This has got to be illegal - it's known as bribery.

[empedocles]

10. Extortion?

[George II]

19. Yes, that's it.

[onetexan]

33. This wreaks of nefarious motives. USPS is a government entity. Why should it "trade" to get funding?

[empedocles]

34. Because both sides of the 'deal' are trumpers?

[onetexan]

36. my point exactly. It's controlled by the mob.

[Zoonart]

6. You have to do me a favor though.......

[cp]

7. Mob tactics

[Wuddles440]

9. Kiss the USPS goodbye!

Il Douche's dismantling of government agencies is nearly complete. No more independence and operating for the public good. All organization will exist solely to benefit him and his cronies.

[Karma13612]

11. Vote out the turd

On November third.

That is all I’ve got to say at this point.

[in2herbs]

29. To be sure your vote gets counted in VBM the date for mailing is Oct. 20th. nt

[Bengus81]

12. Trump claims those USPS rates are a really bad deal. So why would UPS or FedEx even want them??

Going to make Trump look more fucking stupid than he is now??

[Hoyt]

13. Glad the loan is available. Not sure I see a big issue with USPS releasing data.

I know the consensus is that trump wants to undermine the Post Office; but, not sure how that data will help him. I suppose trump can rant about the Post Office not charging enough to Amazon, etc. If it were anyone but trump, we'd be all over that.

[Mopar151]

17. Data beats rumors, all day long. How we roll. n/t

[groundloop]

32. Not so much tRump wants to dismantle Post Office.... GOPers have wanted to privatize it forever

That's why they hung that albatross around the USPS's neck requiring them to pre-fund 75 years of retiree health care. They would fucking LOVE to dismantle the USPS, cut pay and benefits, and auction off the pieces to their cronies.

[Hoyt]

35. Don't really think that is going to happen. I do know that if a company promises to pay medical

benefits in the future, that is accounted for as a liability. State and Local Governments were required to do the same thing in the mid-2000s (Governmental Accounting Standards Board (GASB)).

The Post Office should do the same.

In any event, I don't see it as a terrible requirement for the USPS to release pricing data to receive a $10 B loan that gets them at least through the year. That requirement seems mostly symbolic since trump could pick up the phone, call his recent Postmaster appointee and say send it to me. In fact, I bet the feds already have it.


Info on GASB rules on Local and State Government accounting for retiree benefits: https://www.cbpp.org/research/accounting-for-the-cost-of-retiree-health-and-other-benefits-gasb-45

[Mopar151]

14. It could be, also, a normal business loan practice

Verifying that the terms and conditions do not represent an unreasonable risk. Much compost has been made of the claims that Amazon is "Bleeding the Post Office Dry", time to put that to rest.

[madaboutharry]

18. Where my dad grew up in Brooklyn

that was called a Shakedown.

[mahatmakanejeeves]

21. Is the Postal Service Being Manipulated to Help Trump Get Reelected?

Daily Comment

Is the Postal Service Being Manipulated to Help Trump Get Reëlected?

By Steve Coll
July 29, 2020

{snip}

The Trump Presidency has tested the resiliency of many of the country’s democratic institutions: the courts, the press, the military, the civil service. It is a testament to how thoroughly Trump’s norm-shattering, autocratic leadership has permeated Washington that even the sleepy Post Office has become politicized and thrust into a position where its capacity for independence and professionalism is being tested, and will help determine the story of the United States’ most consequential election in generations.

For most of American history, the Postal Service was a direct arm of Presidential power and political-party patronage; it was only severed from the executive branch, to be funded by its own revenues, half a century ago. A goal of that restructuring was to “get rid of the patronage, the cronyism, and the corruption that may have existed in the old Post Office,” Dimondstein, the union president, told me. “We are concerned that this Administration is going back to that type of past.”

------------

Steve Coll, a staff writer, is the dean of the Graduate School of Journalism at Columbia University. His latest book is “Directorate S: The C.I.A. and America’s Secret Wars in Afghanistan and Pakistan.”

[2naSalit]

23. GONG!!!

[Grins]

24. Don't do it. Call their bluff. Let it all explode!

The impact of no postal service will be enormous to people and businesses. I've said it, and others here have also, let the public SEE and FEEL up close and PERSONAL what life is like under Republican fantasy-economics and Republican governing, because when it hits you PERSONALLY, that's when you wake up.

"Democracy is the theory that the common people know what they want, and deserve to get it good and hard." - H.L. Mencken

[quakerboy]

39. Worst plan ever

No USPS means no vote by mail. Which means no vote for many.

[DeschutesRiver]

25. Trump thinks of no one but his sorry self....

Maybe Bezos will do an economic breach of contract and walk away from it, and continue to expand his amazon delivery service capabilities.

I don’t know what trump is thinking because the Post Office needs amazon I think, not the reverse. Trump is going to screw everyone who needs postal services by blowing things up this way.

I live on a gravel road in a rural area that used to get deliveries from amazon on a less than dependable schedule....mostly amazon used the post office for last mile for all of us. Since March, however, those amazon trucks and flex drivers are in my neighborhood a couple times a day. I’m end of road, super hard to find, postal service doesn’t deliver packages just mail. But Amazon is 100% dependable and gets here anytime I order something. Same for UPS. Straight to my door and at my age, I appreciate it. If I never go to the post office again, I will be happy. Our local one is horrible. My personal situation aside as it’s unique, we have a postal system built into the cake and it is going to stay that way. And Biden can fix this once elected, one of the many messes that will need fixing post trump.

I think Bezos foresaw this blowup by trump and will use it to his advantage. Trump is such a crappy negotiator that he will end up lowering rates for amazon even more to beg him to come back to the post office....

[sarcasmo]

26. Trump screwing over Bezos.

[aggiesal]

27. Isn't this extortion? ...

Using our tax dollars to blackmail a government entity that is written into our constitution.

The depths this administration continues to go to.

WOW!

[bucolic_frolic]

28. Treasury needs and wants this information because ...........????????????

prepping for sale?

Is Treasury acting like a bank? Is the information being used as some statement of viability/collateral?

[lostnfound]

30. "Hey Fedex, you know what they are charging UPS??" I can tell ya for a donation to...

My campaign or for $20 million in bitcoin...

[RussBLib]

31. hey, with $10 billion perhaps we don't have to worry about voting by mail this time

Now each state that has not already needs to allow any citizen who chooses to, to vote by mail. With this frikkin' virus still circulating, it's the only logical thing to do.

Now we are hearing pleas from our local counties to become poll workers. I understand that MOST poll workers are over 60 years old, which is of course, a uniquely vulnerable age group. Tough choice. I'd like to help out, but if we can get to vote by mail, that would alleviate a lot of the strain.

[dlk]

37. There are always strings attached with Republicans - They can't be trusted

We can’t lose sight of Republicans’ endgame for the postal service.

[PatrickforO]

38. The Democrats are going to have to fix USPS from the damage

Republicans have done, beginning with 2006 Postal Accountability Act, which is nothing more than the neocons trying to gut the USPS so it could be privatized. Because that's the mantra - privatize, deregulate and gut government programs.

Plus, it has the added benefit of busting a powerful union.

For a Republican, that's a double whammy! Grover Norquist loves stuff like this!