Obama Moves to Save USPS From Default

He wants to delay a pension payment mandated in 2006 law
By Kevin Spak,  Newser Staff
Posted Sep 7, 2011 9:39 AM CDT
Cartons of mail ready to be sorted sit on a shelf at the US Post Office sort center on August 12, 2011 in San Francisco, California.   (Getty Images)
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(Newser) – President Obama intends to swoop to the rescue of the ailing US Postal Service—or at least try, reports the New York Times. The White House yesterday announced that it would push for legislation giving the USPS a three-month reprieve on the $5.5 billion it’s supposed to pay on Sept. 30 for future retiree health benefits, saving it at least temporarily from a humiliating default.

Even that won’t save the service for long, however—the postmaster general recently testified that, even with the reprieve, they’d run out of money by next July or August. So Obama will also unveil a longer-term plan to save the post office as part of his deficit reduction plan, the Hill reports. He has not yet, however, supported the service’s call to be refunded $50 billion it says it has overpaid into a federal pension plan. The administration says it’s still reviewing that proposal.

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