U.S. Postal Service to Default on Treasury Loan Payments
The U.S. Postal Service is preparing itself to default on billions of payments due to the United States Treasury. This impending default adds even more uncertainty to the fate of an agency that is reported to be losing $25 million a day.
With cash reserves nearing depletion, the Postal Service has announced that it will not make two legally required payments for future health benefits, the first of which is a payment of $5.5 billion due on Wednesday, and another $5.6 billion due in September.
Although this latest development doesn’t bode well for the agency’s future, there will be no interruption in service. Post offices will stay open, employees will continue to be paid, and mail trucks will still run. The U.S. Postal Service will continue business as usual, at least for the time being. Analysts point to long term effects as the agency because preoccupied with staving off bankruptcy.