Postmaster General: ‘Little choice’ on price hike

USPS lost a record $15.9 billion last year, and is on pace to lose billions more in fiscal 2013. Most of the 2012 losses stemmed from a pair of defaults on required prepayments for future retiree healthcare.

At Thursday’s hearing, Donahoe again pressed lawmakers to pass a comprehensive postal bill, and to allow the Postal Service to leave a federal health benefits program and offer their own plan. Unions and federal workers groups generally oppose such a move.

“Resolving our healthcare issues will mitigate the pressure to raise prices and to take other unpalatable steps in the future – but – we must fully address our health care costs to do so,” Donahoe said.

Industries that use the mail frequently – like banks, catalog companies and magazines – were sharply critical of the Postal Service’s proposed price increase, which would start early next year if approved by the agency’s regulator. Those groups say that a price increase would merely cause an even further decline in mail volume.