The Math Adds Up for Trump’s Claim That USPS Undercharges Amazon
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Title : The Math Adds Up for Trump’s Claim That USPS Undercharges Amazon
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Title : The Math Adds Up for Trump’s Claim That USPS Undercharges Amazon
link : The Math Adds Up for Trump’s Claim That USPS Undercharges Amazon
news-today.world | Following a tweet from President Trump today where he called out Amazon and the United States Postal Service, Breitbart News investigated Trump’s claims.
“Why is the United States Post Office, which is losing many billions of dollars a year, while charging Amazon and others so little to deliver their packages, making Amazon richer and the Post Office dumber and poorer? Should be charging MUCH MORE!” Trump said in a tweet posted on Friday.
Trump’s claim that the USPS is losing billions of dollars is entirely correct, in 2016 the USPS announced a $5.6 billion net loss and in 2017 stated a $2.7 billion net loss, making this the eleventh year that the Postal Service has announced a loss. The total from 2007-17 amounts to a staggering $65.1 billion in losses. Things do not seem to be looking up for the organization anytime soon, with the USPS predicting in their public 2018 Integrated Financial Plan that they would suffer a net loss of $5.2 billion in 2018. With mail volume at a 29 year low and amassing large amounts of debt, the Postal Service is facing a tough time ahead.
A Citigroup analysis in July of 2017 found that a subsidy of $1.46 was attached to every Amazon package delivered by USPS due to the Postal Service delivering the company’s packages below their own costs. It was determined in 2007 by the Postal Service and its regulator that a minimum of 5.5 percent of the Postal Service’s fixed costs must be allocated to package deliveries. Ten years later, despite 25 percent of USPS’s revenue coming from packages, the percentage of fixed costs allocated to packages has not increased enough to become profitable.
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“Why is the United States Post Office, which is losing many billions of dollars a year, while charging Amazon and others so little to deliver their packages, making Amazon richer and the Post Office dumber and poorer? Should be charging MUCH MORE!” Trump said in a tweet posted on Friday.
Trump’s claim that the USPS is losing billions of dollars is entirely correct, in 2016 the USPS announced a $5.6 billion net loss and in 2017 stated a $2.7 billion net loss, making this the eleventh year that the Postal Service has announced a loss. The total from 2007-17 amounts to a staggering $65.1 billion in losses. Things do not seem to be looking up for the organization anytime soon, with the USPS predicting in their public 2018 Integrated Financial Plan that they would suffer a net loss of $5.2 billion in 2018. With mail volume at a 29 year low and amassing large amounts of debt, the Postal Service is facing a tough time ahead.
A Citigroup analysis in July of 2017 found that a subsidy of $1.46 was attached to every Amazon package delivered by USPS due to the Postal Service delivering the company’s packages below their own costs. It was determined in 2007 by the Postal Service and its regulator that a minimum of 5.5 percent of the Postal Service’s fixed costs must be allocated to package deliveries. Ten years later, despite 25 percent of USPS’s revenue coming from packages, the percentage of fixed costs allocated to packages has not increased enough to become profitable.
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You are now reading the article The Math Adds Up for Trump’s Claim That USPS Undercharges Amazon With link address https://newstoday-ok.blogspot.com/2018/01/the-math-adds-up-for-trumps-claim-that.html