Total student loan debt in the U.S. is expected to reach $1 trillion this year — more than the nation’s total credit-card debt. The consequences of default are severe. Unlike most debt, student loans are almost impossible to dispose of through bankruptcy. If students fail to repay, their tax refunds can be withheld and wages and Social Security payments can be garnished.
US Postmaster General Patrick Donahue issued a plea to Congress today: Take congressional action now to help the Postal Service avoid financial collapse.“The Postal Service is at the brink of default,” Donahue warned at a hearing before the Senate Committee on Homeland Security and Governmental Affairs Committee. “Our situation is urgent. The congressional action is needed immediately to avoid this default.”
Faced with flagging revenues and high workforce costs, the Postal Service is projected to post a $9 billion deficit on the year and could miss a $5.5 billion payment on retiree benefits at the end of this month.
A bankruptcy of the postal service could have drastic implications, not merely for the agency but for the broader economy. A $1 trillion mailing industry employing more than 8 million workers relies directly on the agency’s services, as do countless American businesses, Donahoe testified.
The rise of email has dramatically curbed demand for old-fashioned letters, while competitive delivery companies have put the squeeze on the post office’s business model. Last year, the post office delivered 171 billion pieces of mail, down 20% from just four years earlier. Volume is on track to fall an additional 2% this year.
Senator Lieberman and Sens. Susan Collins (R) of Maine and Tom Carper (D) of Delaware all underscored the urgency of the situation.
“We must act quickly to prevent a Postal Service collapse and enact a bold plan to save its future,” Lieberman said. “Times are changing rapidly and so too must the Postal Service if it is to survive.”
Stephen M. Dunne, Esq.
Dunne Law Offices, P.C.
1500 John F. Kennedy Boulevard
Two Penn Center, Suite 200
Philadelphia, PA 19102
(215) 854 – 6342 office
(215) 205 – 6367 cell
(215) 525 – 9721 fax