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The United States Postal Service has been a fixture of American life for 250 years, reaching farmhouses, remote villages, and military bases worldwide. In recent testimony before Congress, Postmaster General David Steiner told USA Today the agency’s current business model is “unsustainable.” Behind that word is a financial reality the agency has been contending with for nearly two decades.
Since 2007, the USPS has lost roughly $109 billion, according to the Government Accountability Office. Net losses in fiscal years 2024 and 2025 alone totaled $18.5 billion. Mail volume has dropped nearly 50 percent from its 2006 peak, as more Americans pay bills, sign documents, and communicate entirely online. First-class mail, once the agency’s most profitable product, has been declining for about 20 years.
Still, the USPS is legally required to deliver to every address in the country, six days a week, at a uniform price. That “universal service obligation” costs the agency more than $6.5 billion annually, the Postal Regulatory Commission estimated in 2025. Steiner acknowledged to Congress that 71 percent of USPS delivery routes lose money. “The math is pretty simple,” he said. “Revenues and services cannot offset the costs associated with the universal service obligation.”
The Proposals on the Table
The Postal Service is weighing several moves to stop the bleeding. Reducing delivery from six days to five days a week could save between $2.9 and $3.5 billion annually. Closing unprofitable post offices and routes could free up another $1 billion. The agency has also proposed increasing stamp prices, most recently requesting a 5 percent hike that would bring a forever stamp to 82 cents, though Steiner has pushed for a price closer to one dollar.
The USPS also temporarily suspended some payments to a government retirement fund, a step it says will free up roughly $2.5 billion this fiscal year to keep operations running through February. On the borrowing side, Congress capped the agency’s debt limit at $15 billion back in 1992, and the USPS has been at that ceiling since late 2024. Steiner is asking lawmakers to revisit that cap and to allow retirement funds, currently restricted to Treasury notes, to be invested more broadly. Even with those fixes, the agency’s revenue challenges run deeper.
According to the New York Times, the agency also faces a competitive disadvantage it cannot price its way out of: private carriers like FedEx, UPS, and Amazon have cut significantly into package delivery, which is where growth once seemed possible. Unlike the USPS, those companies are not obligated to serve every address at a fixed price. The agency’s ability to raise prices also requires approval from an independent regulatory commission, limiting how quickly it can respond to rising fuel and labor costs.
A Debate Without Easy Answers
Lawmakers have been cautious. At a recent oversight hearing, members from both parties expressed reluctance to cut services, particularly for rural constituents. Representative Pete Sessions of Texas said he represents a large rural district and cares about every resident’s access to mail. Representative Kweisi Mfume of Maryland said he was committed to working on reform but was firm: “We cannot lose the postal service as we know it.”
Outside Congress, some voices are pushing for a more fundamental rethink. USA Today reported that the Wall Street Journal argued in a May editorial that additional federal funding would not address the root problem, calling the USPS business model “an anachronism in a digital world.” The editorial urged Congress to remove pricing mandates and delivery requirements. Steiner has also asked Congress to treat the issue as a non-partisan one, saying the agency was “created to serve the nation.”
Rural communities, where private carriers have little financial incentive to deliver, stand to be most affected by any service reductions. In some remote areas, the USPS is the only reliable way to receive prescription medications, legal documents, and election ballots. David Marroni, a postal expert at the Government Accountability Office, said the existing model, built on the idea that the USPS should be financially self-sufficient through postal services alone, “just doesn’t work today.”
What Comes Next for the USPS
Congress has the final say on most of what Steiner is proposing, from loosening price controls to adjusting the debt ceiling to revisiting the six-day delivery mandate. Steiner told lawmakers the agency can adapt to whatever direction they choose, but warned that without action, the USPS could run out of cash within a year.
For now, price increases are moving forward. An 8 percent surcharge on packages is set to take effect later this month, approved by the Postal Regulatory Commission in response to higher fuel and transportation costs. The 5 percent stamp increase is pending. Whether those steps are enough, or whether bigger structural changes follow, depends largely on how far Congress is willing to go.
What makes the USPS debate so complicated is that it is not just about finances. It is about what the country decided, going back to 1775, that it owes every resident, regardless of where they live. The agency has delivered through wars, recessions, and a pandemic. Whether Congress decides it is worth preserving in its current form is now the question.