Myth #2: USPS has cut its costs.Fact: Costs are increasing. Any potential savings are beingoverridden by rising costs, especially for compensation andbenefits.
One senior Postal official recently cited workforce reductions through retirements in the lastdecade as evidence of cost cutting saying, “We know how to cut costs.”In reality, even as USPS revenues dramatically and predictably decline the Postal Service hasfailed to meaningfully cut its expenses. During the first 8 months of this fiscal year, USPSrevenues declined more than $1.2 billion but USPS expenses actually increased by $281million.
Myth #3: USPS receives no taxpayer support.Fact: USPS has received billions of dollars in indirecttaxpayer subsidies over the years.
USPS benefits from preferential local, state, and federal tax treatment that results in an indirectsubsidy, or tax expenditure, from all levels of government. USPS is exempt from the following:
Local, State, and Federal Income Tax
Motor Vehicle Registration
Like Fannie Mae and Freddie Mac, USPS can borrow money at very low interest ratesfrom the U.S. Government; USPS borrows money through the U.S. Treasury paying lessthan 1% interest on some debt. The Postal Service has a $15 billion line of credit withU.S. Treasury.