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WASHINGTON--It's no secret that the U.S. Postal Service is in financial trouble. Its business is shrinking, with first-class mail revenue dropping 25 percent since 2006. It has lost $25 billion in the last five years.
To stem the tide, the USPS is pursuing a wide range of cost-cutting measures. Among them: closing underused post offices. It has identified about 3,700 for possible closure, ranging from Pony Express Station in Fallon, Nev., to the U.S. Capitol Station in Washington. The plan has caused an uproar, leading the Senate
Closing a post office has never been a politically popular move. There is a kind of reverse NIMBY (not-in-my-backyard) effect at work: No one wants to lose the perceived benefits of a local post office. And for members of Congress, post offices are perhaps the oldest form of pork. Many members have been re-elected based on bringing in post offices--which often end up bearing their names. Few have won an election for closing one.
But despite this political popularity, Americans are using their local post offices less than ever before. Electronic alternatives such as stamps.com, as well as sales at supermarkets and other retail stores, have meant fewer trips to the post office. As a result, traffic at America's post offices dropped 21 percent from 2009 to 2010. Fully 80 percent of post offices lose money.
The Postal Service's ability to make sense of this system is limited. It is, for instance, barred from closing any small post office because it is losing money (as if that were an irrelevant consideration). Closure decisions are also subject to a lengthy and cumbersome review process, including a 60-day public comment period and appeal before the Postal Regulatory Commission.
Typical of the closures sought by the Postal Service is the post office in Hope, Minn. During an average business day, it sees eight customers, who require a total of seven minutes of service. Last year, the Postal Service announced plans to close the facility, and instead serve the 90 residents of Hope from the adjacent town of Ellendale, 10 minutes away. Still, the closure was actively opposed, ending with an appeal to the Postal Regulatory Commission before the move was recently cleared.