postal banking

[sd'sker]

How the post office could save the economy — and change your life

 

Ever since the inspector general of the U.S. Postal Service authored a white paper endorsing the concept of postal banking, more advocates and policymakers have become intrigued. Postal banking is actually an old idea: Dozens of countries offer simple financial services through their posts, and here in America, Postal Savings Accounts served millions of customers from 1911-1967 (the post office still sells money orders today). But it could also fix a number of our current problems simultaneously, even ones you haven’t thought about. Here are 10 different applications of postal banking, in order from most to least obvious:

[JJ Husker]

They lost me after only the first two bad examples. People with no money utilizing the postal service for banking will not help the economy one iota. People currently using alternative services (payday loans, ck cashing services, etc.) would simply be transitioning their business, reducing one while increasing another. The net economic impact would be zero. Plus, if the postal service began giving loans that current banks deem ill advised, that seems like yet another opportunity for a bailout by people that actually have money. If we want to help the economy then it needs to grow and employ more Americans not simply slosh about what money is already in the economy.

[sd'sker]

People currently using alternative services (payday loans, ck cashing services, etc.) would simply be transitioning their business, reducing one while increasing another. The net economic impact would be zero.

it would absolutely be a positive economic impact. the alternative services you mention are the first step to bankruptcy. who pays for that now? the benefit comes for those low income families being able to afford the debt they need. it would be much better for the economy.

 

plus, they are talking about access to just basic banking because their communities lack such services totally:

By offering basic financial services – an ATM card, an interest-bearing savings account, even potentially small loans – the Postal Service can give millions stable access to banking, a critical component of our modern society. Try renting a car, obtaining health insurance on healthcare.gov or even getting a job without a bank account.

 

but this has to be a strain on the economy at large as much as it is for the individual families:

 

According to the Postal Service IG report, the average household spends $2,412 a year on interest and fees for alternative financial services. This is about one-tenth of their gross income, going right into the corporate accounts of unscrupulous and predatory operations.

...

Not only does this fit with the regulatory imperative of protecting Americans from financial abuse, it gives them breathing room to pay for necessities, putting the money back into the economy. People who filed for bankruptcy in 2012 were just $26 a month short of meeting their expenses. Discounted financial services could fill that gap, lifting many Americans out of desperation and stretching their income.

[JJ Husker]

I see where it could be much better for some individuals and families (and that would be good for them and their economic impact) but I fail to see any overall benefit for the economy at large. I think the success stories would be overshadowed by the failures- the cases where the taxpayers end up picking up the tab. It might have a slight positive impact but nothing more. The real answer is economic growth and job creation. For a truly healthier economy we need more people being self sufficient, fewer people dependent on the government and their fellow citizens, and a more reasonable distribution of wealth. What I currently see is a shrinking middle class paying all the bills. And the middle is not shrinking because they are doing better but rather moving in the wrong direction. We need to reshore manufacturing jobs, quit sending our wealth to other countries for their cheaply made crap, get people off the public dole, and reduce the tax burden on the middle and lower class. Gimmicks with a government entity like the postal service is simply flailing about and ignoring much bigger issues.

[sd'sker]

i agree, jj. and i do not think that the postal service banking would be a silver bullet. and i think it would/should not offer banking to everyone. just those that fall through the gap where they could handle banking, but it is not accessible to them. the people that are $26 dollars from bankruptcy. i just think it would be good for the postal services and anything the makes predatory banking obsolete is good.

 

but i do agree with what you said about the middle class and the increasing burden on a shrinking class.

 

i would not qualify postal banking as a gimmick. i think it is a creative solution to some problems. if it helps the postal service become profitable and offer resources to a group of people who are stuck in a gap, why not?

[JJ Husker]

i agree, jj. and i do not think that the postal service banking would be a silver bullet. and i think it would/should not offer banking to everyone. just those that fall through the gap where they could handle banking, but it is not accessible to them. the people that are $26 dollars from bankruptcy. i just think it would be good for the postal services and anything the makes predatory banking obsolete is good.

 

but i do agree with what you said about the middle class and the increasing burden on a shrinking class.

 

i would not qualify postal banking as a gimmick. i think it is a creative solution to some problems. if it helps the postal service become profitable and offer resources to a group of people who are stuck in a gap, why not?

 

I'd give ya the thumbs up emoticon if I could do that on my phone.

You're right, anything that helps at all is better than nothing. It will take a number of steps to have a noticeable impact on the economy. The USPS just hasn't been real high on my list lately. Have experienced numerous cases of lost or delayed mail. I sorta figured if they struggle with their core business, they probably don't need to branch into other areas.

[greenmonkey51]

i agree, jj. and i do not think that the postal service banking would be a silver bullet. and i think it would/should not offer banking to everyone. just those that fall through the gap where they could handle banking, but it is not accessible to them. the people that are $26 dollars from bankruptcy. i just think it would be good for the postal services and anything the makes predatory banking obsolete is good.

 

but i do agree with what you said about the middle class and the increasing burden on a shrinking class.

 

i would not qualify postal banking as a gimmick. i think it is a creative solution to some problems. if it helps the postal service become profitable and offer resources to a group of people who are stuck in a gap, why not?

 

I'd give ya the thumbs up emoticon if I could do that on my phone.

You're right, anything that helps at all is better than nothing. It will take a number of steps to have a noticeable impact on the economy. The USPS just hasn't been real high on my list lately. Have experienced numerous cases of lost or delayed mail. I sorta figured if they struggle with their core business, they probably don't need to branch into other areas.

 

USPS handles rouhgly 430 million pieces of mail every day. When you handle that much mail sh#t happens. I've had bad experiences from USPS, UPS, and Fedex. No package/mail service is perfect. I would say the do a pretty good job.

[sd'sker]

jj, i like this idea, but i never thought it would fix the economy. it would be nice if it could just fix the postal service. i think we were coming at this conversation with different mindsets, but we are largely on the same page. the article's title is definitely just to get attention, but what it claims seems implausible. i never really read it thinking like it was a feasible idea to "fix" the economy. i just thought it was an interesting idea and could help some areas of the economy, mostly on the micro level.

[tschu]

I think there's some interesting ideas in there. As far as "fixing" the postal service, how about we stop paying simple mail carriers 55k/yr with insane benefits, overtime availability, and retirement pensions.

 

I really wish I hadn't gone to college and had decided to just deliver mail all day. No education or skills needed and you can live a very, very healthy middle-class living. It's absolutely insane.

[Hooked on Huskers]

I see where it could be much better for some individuals and families (and that would be good for them and their economic impact) but I fail to see any overall benefit for the economy at large. I think the success stories would be overshadowed by the failures- the cases where the taxpayers end up picking up the tab. It might have a slight positive impact but nothing more. The real answer is economic growth and job creation. For a truly healthier economy we need more people being self sufficient, fewer people dependent on the government and their fellow citizens, and a more reasonable distribution of wealth. What I currently see is a shrinking middle class paying all the bills. And the middle is not shrinking because they are doing better but rather moving in the wrong direction. We need to reshore manufacturing jobs, quit sending our wealth to other countries for their cheaply made crap, get people off the public dole, and reduce the tax burden on the middle and lower class. Gimmicks with a government entity like the postal service is simply flailing about and ignoring much bigger issues.

USPS is not a US government agency. Semi-independent business since 1970 law. And no taxpayer aids....not a cent. The only thing, 1970 lawmakers clause approved by congress for a major policies. For example, USPS wants 5-day week and streamlined by closing down small post offices but no........handcuffs courtesy of crooked and pork politicians.

[Hooked on Huskers]

I think there's some interesting ideas in there. As far as "fixing" the postal service, how about we stop paying simple mail carriers 55k/yr with insane benefits, overtime availability, and retirement pensions.

 

I really wish I hadn't gone to college and had decided to just deliver mail all day. No education or skills needed and you can live a very, very healthy middle-class living. It's absolutely insane.

Not anymore since FERS retirement plan (1985). FERS pension was only 30% (based on 30 years service) of active salary. Used to be civil service plan but again, not anymore. CSP pensions got 60%, twice the amount of FERS. For example, your $55K mailman job calculate $55K x 30% = $16.5 pension.

 

And $55K is a little bit too high. Starting salary is about $40K. You know two out of three quit the mailman job for the first year ..... reason, high tension job.

[tschu]

$40K for an entry-level, unskilled worker is still very attractive these days. Most college grads don't even make that starting out. And most jobs have ZERO pension. I'll take a 30% pension any day.

[Hooked on Huskers]

$40K for an entry-level, unskilled worker is still very attractive these days. Most college grads don't even make that starting out. And most jobs have ZERO pension. I'll take a 30% pension any day.

Unskilled worker? Not true. I admit I failed mailman pre-test application. Equal to Rubik's cube solvers every day.

[tschu]

Unskilled of course not meaning "having zero skills" but rather "requiring no higher education, degree, or certification prior to getting a job" - aside from that single test of course

[sd'sker]

$40K for an entry-level, unskilled worker is still very attractive these days. Most college grads don't even make that starting out. And most jobs have ZERO pension. I'll take a 30% pension any day.

yeah, it is a sweet gig. i know a guy and that is all he wanted to do. he got the gig and lives a pretty comfortable life. he had it figured out.