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Fmr. CBO Director Douglas Holtz-Eakin and Americans for Prosperity Founder Tim Phillips on a potential bailout of the U.S. Post Office.
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Here with us now former CBO director Doug Holtz -- and -- Phillips the founder of Americans for prosperity welcome -- you about.
There Tim I wanna start with you what do you make about this that payouts for pay and that actually bailed out -- companies so generously.
It's for some reason when taxpayers are on the hook up performance flies out the window it happens for the post office it happens for big firms like this.
That took the bailout money and they're trying to run running give their guy 42 million even though the stock stopped performing.
It's it's sadly business as usual.
Well I you know -- -- you -- way and here because look I am all for people making a lot of money but it should be paper performance what do you say.
I'm with you on that I think private company should be able to pay that are there executives are they want but I mean to suggest the board thinks it's have been worse -- hard to believe -- I think they're not they're not doing it with private money I mean I like capitalism when they use their own money in their using the taxpayers' money here and it does change the way you think about this.
I really don't understand these retention bonuses I mean what firm was trying to hire him so it's hard to make a lot of sense out of this.
You it's not like he was being had had had RE.
You know this all brings up the question though of what's going on -- post office right now because again we're talking about a possible tax -- bailout Tim to you first.
Does that make any kind of sense to you to have a bailout of the post office.
That's it actually does not they have a fifteen billion dollar treasury line -- clearly shocked to hear this but a big government bureaucracy they burn through the whole thing.
So now they have slow off the hook for five point four billion no intentions of benefits.
Which -- out that's wrong look these guys have a government mandated.
Monopoly yet they still can't turn a profit they lost nine billion dollars last year -- on track to lose even more this year.
It's time we drew a line in the sense that luck.
We're not gonna keep -- more taxpayer dollars that we don't have at failing big government institutions.
-- you know obviously the USPS I mean they do their own thing -- they really run their operations on their own diamond fortunately their own dime is getting slimmer and slimmer.
They've lost twenty billion dollars since not since 2007.
What should happen here.
I think you should let post office like it was the 51 state it has all the same problems of state has so it's got these these big pension plans that -- can't afford they're gonna have to restructure them.
And they gonna have to pay the the new workers differently but most importantly just -- the other fifty states we shouldn't be bailing them out.
We should be giving them the flexibility to get a business -- actually works let's close post offices throughout dated let them deliver service -- people value.
-- and keep them off the federal -- and so in exchange for flexibility they get the solve the economic problem but but you cannot just put more money into this it's broken.
-- at one thing was sure go -- here to note this -- it's a Karzai government agency in effect.
But congress plays politics with them all the time and that's exactly why we should not have massive government bureaucracies like this for example like the health care bureaucracy they want to build.
It'll be the same thing politicians playing politics.
Taking care their bodies using government agencies like this is it's a cautionary tales.
Well Doug just to push.
Back on this -- I mean.
Look these are a lot of American jobs here's what senator Tom Carper had -- had to say to the Postal Service.
Operates at the center of an industry that employs some seven million people and it generates more than a trillion in sales and revenue each year.
As such a difficult and fragile time for our economy we can't afford to lose these jobs -- that kind of productivity.
What do you think though that no that's that's sorry it lets out aim a little.
Higher for the average American -- -- -- condemn them to work for the US postal self service we want them in a vibrant.
Setting where the companies making money but they're selling around the globe.
But they have a chance to -- to deliver a modern product using modern technologies.
None of that is the US Postal Service so the notion that somehow that taxpayers a commitment to preserving American stuck in a bad job is actually -- about it all wrong we should have a higher gold -- that.
Well and in out.
Tim this is it is this a business line -- what the USPS does United States Postal Service are I think it's been eclipsed by technology.
They've been eclipsed by technology.
And again they do not have flexibility because there -- a massive.
Claus I federal agencies congress plays politics with them because of what is senator corporate it was -- was just talking about.
-- we want to protect this that means every little.
A post office that's inefficient not making money out so where are not even be able breakeven.
They -- they don't have the flexibility they need that's why we -- private sector we need the free market involved.
Not a centrally planned almost Soviet era model.
-- doesn't work to protect such a model that doesn't.
Well Ed one more thing here would take the EU -- comment on dad this -- a recent report on this whole situation.
USPS officials are now asking congress to skip their annual five point four billion retiree health benefit prepayment.
And to adopt -- pay as you -- system the same method currently used by states like California.
That can't meet their obligations is that a good idea or a bad one.
That's a bad idea what this is lesser sentence the 51 date the same accounting tricks that have left these states with -- -- plans that are badly underfunded.
And badly ever committed are all being done it with the US Postal Service so you really do need to change the business model.
They're not competing with that's fedex's and UPS -- of the world.
Now we can't compete with email they need to have a business -- actually is has a future and then pay their workers something that makes sense in that context.
That attempt thanks -- -- appreciate your time.
