His rationalization backfired when he compared ObamaCare to the US Postal Service and how it competes against rivals Fed EX and UPS.
Explaining why he believes a public option would not crowd out and ultimately eliminate private insurance, Obama said, “My answer is that if the private insurance companies are providing a good bargain, and if the public option has to be self-sustaining…then I think private insurers should be able to compete. They do it all the time. I mean, if you think about it, UPS and FedEx are doing just fine, right? No, they are. It’s the Post Office that’s always having problems.”
Fast forward to today, where the USPS has proposed laying off 120,000 workers and withdrawing from federal health and retirement plans because it believes it could provide benefits at a lower cost.
In the four year period through Fiscal Year (FY) 2010, mail volume declined 20%, from 213 billion to 171 billion pieces, while prices for postal products remained capped at the rate of inflation—resulting in net losses over the period of just over $20 billion, including a loss in FY2010 of $8.5 billion.
(In case you are wondering, that $8.5 billion dollar loss this year works out to a little over $28 dollars for every man, woman and child in the United States.)
The USPS is not a Federal agency and does not receive money from the government directly. But as it is established by the Constutition, it is overseen by an eleven member Board of Governors, nine of which are appointed by the President.
And why is the USPS having problems?
Since 2007, the Postal Service has faced the financial strain of steep declines in mail volume and revenue, combined with increases in network costs, wages and benefits, and new legal requirements.
Clearly emails, texting, and other sorts of information transmittal have hurt the Post Office’s revenues. We don’t believe that anyone can deny that. But it is interesting to note that the USPS is saying it is hurt by federal wage and benefits programs, as well as new governmental regulations.
And just think….. the United States Postal Service was the company that Obama lauded and claimed was comparable to his health care plan just two years ago.
That comparison isn’t working out too well, is it?