Private businesses can - and do - file for bankuptcy protection if their pension obligations become overwhelming. (Hostess and American Airlines are good examples of companies doing this.) This option is unavailable to the United States government since a default on the federal government's debts would be catastrophic for the world economy. Likewise, the due process clauses of the United States Constitution generally prevent the federal government from eliminating existing pension benefits. (If the federal government eliminated existing pension benefits by fiat, it would be depriving a citizen of his or her property rights without due process of law, an action prohibited by the United States Constitution.) Accordingly, while pensions are certainly onerous on private businesses, they are particularly onerous on the federal government, which faces considerably more restictions on its ability to restructure benefits.mjmjr25 wrote:
Many businesses would be profitable if they weren't paying (or in this case...overpaying) for pension and other benefit plans, but, they are and they do. However, well-run (non-government) businesses plan and adjust accordingly to remain solvent.
Moreover, when a private business such as Hostess, defaults on its pension obligations, it essentially dumps the obligation on the federal government (and taxpayers) which pays the obligation through the Pension Benefit Guaranty Corporation:
http://www.pbgc.gov/
Thus, it is particularly enraging to me when a company, like Hostess, pays its executives incredible sums of money that could have been used to fund its pension obligations...and then dumps its pension obligations on U.S. tax payers.
In any event, my point is that we should not condemn the U.S. Postal Service solely because of its association with the federal goverment because the mere association makes running the U.S. Postal Service as a business much, much more difficult.
