The timing couldn’t have been worse for Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez.
The U.S. Postal Service delivered a crushing reality check on the two lawmakers just one day after they proposed a “not-for-profit public option for basic banking services” that would be modeled after the post office.
“We should have a not-for-profit public option for basic banking services, and we should be piloting these projects through the U.S. Postal Service or any other number of ways,” the New York Democrat suggested.
.@RepAOC “We should have a not-for-profit public option for basic banking services, and we should be piloting these projects through the @USPS” #postalbanking pic.twitter.com/dobyU4hdT2
— Take On Wall St (@TakeOnWallSt) May 9, 2019
The idea of the inefficient U.S. Postal Service operating checking and savings accounts was met with deserved mockery, even as Sanders touted providing services to the “unbanked” and “underbanked.”
Banks make record profits discriminating against people of color and denying basic banking services to 63 million adults who are unbanked or underbanked.
We must allow every post office to offer basic, affordable banking services and end lending discrimination once and for all.
— Bernie Sanders (@BernieSanders) May 9, 2019
Before the details of such a plan could even be hashed out, the USPS released its quarterly fiscal report which revealed losses of $2.1 billion in just three months. Current revenue is “essentially flat” with a decrease of $8 million for the second quarter of fiscal 2019, the report indicated.
“The net loss for the quarter totaled nearly $2.1 billion, an increase of $747 million, compared to a net loss of $1.3 billion for the same quarter last year,” the report said, with numbers indicating that the USPS is on track to finish the current year with a loss of more than $7 billion.
An increase in expenses such as workers’ compensation costs, pension liabilities and health benefits for retired employees have driven the major losses despite the increases in the cost of stamps and of sending first-class mail.
“The Postal Service continues to pursue aggressive management actions and to seek legislative and regulatory reforms to address our overall cost structure and enhance revenue-generating opportunities,” Postmaster General and CEO Megan J. Brennan said in the report.
The agency has “no clear path to profitability,” a 2018 White House assessment report concluded as it has lost $69 billion since 2007.
“We continue to face challenges from the ongoing migration of mail to electronic alternatives, and we are legally limited under current law in how we can price our products and streamline our legacy costs,” Chief Financial Officer and Executive Vice President Joseph Corbett said. “Within the framework of our current business model, we are executing to grow revenue and reduce operating expenses.”
As Corbett noted, the increase in consumers turning to electronic bill-paying options has affected the agency, which would make one wonder how Ocasio-Cortez and Sanders would convince these same people that the USPS will now offer even better banking services.
The USPS report and the banking option idea, coming from a freshman congresswoman who didn’t know what a garbage disposal was, sent heads crashing to desks on social media.
You’re welcome America. pic.twitter.com/EqT4wxMw1F
— Saving Ferris ⚕️ (@StreetDoc_67) May 10, 2019
AOC’s bank needs a bailout before it’s even opened. https://t.co/M2RECf1JiV
— coketown (@JoeyConnell) May 10, 2019
How is turning the post office into a bank “for the poor” even supposed to help things? Are they not going to act like a real bank and just give an account to anyone, even those who can’t get a regular bank account due to writing bad checks all of the time?
— Bob Yuler (@Ironic_Name) May 10, 2019
Historically, they can’t ever manage their own money, even with a monopoly.
— Rusty Shackleford (@LibertyMtneer) May 11, 2019
???? Free college and health care could be handled by the Post Office too.
— American (@AmericaUprise) May 11, 2019
Yeah, well it wouldn’t lose money if the Republicans gave it more, now would it? #AOCWisdom https://t.co/u3BFuC51do
— Crotchety Old Nathan Wurtzel (@NathanWurtzel) May 10, 2019
? lol, @aoc and @BernieSanders are absolute geniuses. https://t.co/4U44vOYU8C
— Pixie ?? SS ☕️? (@pixiejss) May 10, 2019
@AOC : “USPS is so great with money let’s make them a BANK ? ”
??♂️— Angelo (@angelo100) May 10, 2019
Come on guys, it’s not like she’s the expert on this stuff! pic.twitter.com/DPlLT4fSFB
— ??#IAmTheNRA Rosenblum (@StevenRosenblum) May 11, 2019
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Originally from New York, Powers graduated from New York University and eventually made her way to sunny South Florida where she has been writing for the BizPacReview team since 2015.
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