Postal Service Tries to Avoid Twinkie’s Fate

Squeezed to the point of extinction, Post Office's options are limited.

While the Hostess Twinkie may not be as central to the U.S. economy as the mail, Postmaster General Patrick Donahoe sees uncomfortable parallels of iconic products within unworkable organizational structures.

“Companies and industries have gone over their own fiscal cliff because they can’t sit down and work out their differences,” Donahoe said in an interview last week. “Like Hostess.”

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The service has asked Congress to relieve it of its obligations to deliver mail to every address in the country six days a week and to pay about $5.5 billion a year into a future retirees’ health-care fund -- an expense that accounts for most of the service’s annual losses.

Union Contract

In 2011, with mail volume and revenue well past its peak, the service signed a contract with its largest union that prohibits most employees from being fired if the service wants to downsize. The service is now offering its second round of early-retirement incentives, giving as many as 114,000 American Postal Workers Union members $15,000 apiece to retire.

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