You’ll recall from this story yesterday that the Postal Service is in danger of running out of cash this year, barring new legislation from Congress. John Potter, the postmaster general, said he intends to keep paying salaries and operational expenses â€” but the Postal Service might have to forego its annual contribution to the retiree health benefit trust fund.
What happens then?
There won’t be an impact on retirees, because the trust fund covers future retiree benefits. The Postal Service currently spends about $2 billion annually to cover current retirees.
The more interesting question is what Congress or the Treasury Department might do. And nobody knows the answer. I’m told, via the Postal Service’s legal department, the statute that created the trust fund is vague â€” it doesn’t specify any penalties for missing a payment. It’s uncharted territory.