Wednesday, August 01, 2012

The United States of Acme

This country only starts to make sense if you think of it as a Looney Tunes cartoon.

Things start to fall into place further if you imagine some sort of superpower client state of the Acme Corporation. And you begin to achieve perfect clarity if you view the executive, legislative and judicial branches of government in the personages of Wile E. Coyote, Foghorn Leghorn and Daffy Duck.

Bugs Bunny and the Road Runner? Emigrated to Canada in '04.

IN THAT LIGHT, may I present the latest Looney Tunes: Washington episode, "The Postal Service Runs Off a Fiscal Cliff" -- presented with limited commercial interruptions by Acme.

"Acme Corporation . . . if you're askin' for it, we'll let you have it. But good.

Now we switch you -- live and direct -- to CBS News and The Associated Press:
The U.S. Postal Service braced Wednesday for a first-ever default on billions in payments due to the Treasury, adding to widening uncertainty about the mail agency's solvency as first-class letters plummet and Congress deadlocks on ways to stem the red ink.

With cash running perilously low, two legally required payments for future postal retirees' health benefits -- $5.5 billion due Wednesday, and another $5.6 billion due in September -- will be left unpaid, the mail agency said Monday. Postal officials said they also are studying whether they may need to delay other obligations. In the coming months, a $1.5 billion payment is due to the Labor Department for workers compensation, which for now it expects to make, as well as millions in interest payments to the Treasury.

Some members of Congress are seeing Wednesday's default as a cry for help, CBS Radio News correspondent Dan Raviv reports from Washington. The Senate passed a bill in April to spread retiree health payments over a longer period and to allow the Postal Service to save money by canceling Saturday deliveries, but the House of Representatives has not taken any action.

Congress let the Postal Service delay Wednesday's payment for more than half a year.

Financial analysts feel Wednesday's default could be a step toward filing for bankruptcy, Raviv reports.

The defaults won't stir any kind of catastrophe in day-to-day mail service. Post offices will stay open, mail trucks will run, employees will get paid, current retirees will get health benefits.

But a growing chorus of analysts, labor unions and business customers are troubled by continuing losses that point to deeper, longer-term financial damage, as the mail agency finds it increasingly preoccupied with staving off immediate bankruptcy while Congress delays on a postal overhaul bill.

Postmaster General Patrick Donahoe has described a "crisis of confidence" amid the mounting red ink that could lead even once-loyal customers to abandon use of the mail.



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