Originally Posted by
KonAaron Snake
I'm not sure how USPS pensions work, but I do know how the accounting for pensions works (or doesn't work as is often the case) in for profit and in government accounting. It was only fairly recently that Governments really had to report on pension liabilities at all...and after those rules were phased in, they were permitted a 30 year period to phase in the new accounting standards reflecting pension liabilities. Pension obligations are essentially forecast annually by actuarial guys who recommend a pension funding level for the company.
Those funding amounts are very tricky to calculate and you can smooth them out over periods of time due to market volatility. Often those funding levels aren't met (particularly in government funds) and the results are liabilities that should be carried on the balance sheet. That gets fuzzy in government accounting for the reasons mentioned earlier. No one has ever been willing to sign off on the financial statements of the federal government by the way.
Pensions across the board are often underfunded - but since they're also government insured, they have a sucker to bail them out.
There were specific laws enacted just for the post office, so reason and typical accounting standards get tossed aside. The USPS also has to fund in advance retiree health benefits, to high levels and had to do " make-up" payments extremely quickly far before need. Then if you add in veterans who work there and retire and will most probably be in the VA health care system... It is nuts. Internal GAO and other reports acknowledge the goofs but without legislation to change things... The status quo will continue. The next Congress will most likely not be the one to do anything as it would undermine the case for privatization.
This does not forgive poor service. Around here we lost a number of close to retirement carriers who were good due to the risks that became unfortunately real after the anthrax mess.