Anyone remember my commentary about a year ago regarding pension plans - including public pensions - being in serious trouble and ultimately being at risk of insolvency?
What happens when you have no money coming in but still have obligations going out? Specifically in this case, pension obligations regarding health care benefits for retired Postal Workers?
Gee, I wonder if the Obama Administration's push to put everyone into a situation where they can obtain Medicare might be related to this? Perhaps - just perhaps - this is one way they can stave off the implosion of one of the more-important public-sector benefit groups?
By the way, USPS is reporting a 13% reduction in mailed volume, and I'm willing to bet that a huge part of that is from bulk (junk) mailers who have had their business implode or simply have had to slash marketing budgets. Less junk mail, less revenue, and with a bloated bureaucracy you can guess what comes next.
I have to wonder what the APWU (the largest postal-workers union involved, an affiliate of the AFL-CIO) along with the NALC, NRLCA and NPMHU (the other major unions involved) will think of this, and whether their memberships, along with the folks in civil service side, will consider that a year ago or thereabouts I issued a rather plain-spoken warning to union members everywhere outlining that exactly this sort of problem was soon to show up.
Oh, for some scale, these unions represent some 700,000 workers; this is not exactly "small potatoes."
I hate it when I'm right.
Where We Are, Where We're Heading (2013) - The annual 2013 Ticker
The content on this site is provided without any warranty, express or implied. All opinions expressed on this site are those of the author and may contain errors or omissions.
NO MATERIAL HERE CONSTITUTES "INVESTMENT ADVICE" NOR IS IT A RECOMMENDATION TO BUY OR SELL ANY FINANCIAL INSTRUMENT, INCLUDING BUT NOT LIMITED TO STOCKS, OPTIONS, BONDS OR FUTURES.
The author may have a position in any company or security mentioned herein. Actions you undertake as a consequence of any analysis, opinion or advertisement on this site are your sole responsibility.
Looking for "The Best of Market Ticker"? Check out Ticker Classics.
Market charts, when present, used with permission of TD Ameritrade/ThinkOrSwim Inc. Neither TD Ameritrade or ThinkOrSwim have reviewed, approved or disapproved any content herein.
The Market Ticker content may be reproduced or excerpted online for non-commercial purposes provided full attribution is given and the original article source is linked to. Please contact Karl Denninger for reprint permission in other media or for commercial use.
Submissions or tips on matters of economic or political interest may be sent "over the transom" to The Editor at any time. To be considered for publication your submission must include full and correct contact information and be related to an economic or political matter of the day. All submissions become the property of The Market Ticker.