The Postal Service is dying -- could they just build a new one?

Cartons of mail ready to be sorted sit on a shelf at the U.S. Post Office sort center on August 12, 2011 in San Francisco, Calif.

Well, "could" is the operative word here. And "could" is a long ways from "will." The USPS operates in a kind of unique way. It's an independent agency that still must answer to Congress.

That's why Postmaster General Patrick Donahoe was on Capitol Hill yesterday, lobbying Congress for more power to make changes to the USPS that he says could make it more solvent. Among the ideas being discussed: layoffs and ending Saturday delivery.

The USPS gets money from the sale of postage but people just aren't using it as much as they used to. Mail delivery is down 26 percent from four years ago since many people prefer the cost (essentially free) and convenience (essentially instant) of email. Plus, no yucky stamp taste.

A. Lee Fritschler is a professor of public policy at George Mason University and former chair of the U.S. Postal Rate Commission. He says technology has changed what the Postal Service does: "The key to understanding what's going on is that from the earliest days, the Postal Service was a means of communication. Two-way, three-way communication. It's now become, thanks to the Internet and telephone, a broadcast medium. It is doing the same kind of thing that newspapers, magazines, radio stations, TV stations do, that is it carries advertising. It sends out advertising. It's broadcasting, not communicating. So what's happened is the communication function has been hurt badly by the internet and the broadcasting function is in competition with other media I just mentioned. So the Postal Service is in a bad spot."

Ed O'Keefe writes the Federal Eye blog for the Washington Post and says ideas to radically change the USPS are a hard sell in Congress. "There have been proposals," he says, "like possibly providing some kind of secure electronic delivery system, or even just putting more services online, like being able to hold, or temporarily suspend your mail delivery. Things like you can do on their website. And Increasingly they are pushing people to the website. You can track packages. Print out shipping labels. But beyond that, it's difficult.

"They wanted to do banking, they wanted to do insurance, possibly sell cell phone coverage or services, Congress said no because you have 32,000 locations across the country, you'd have an advantage over the private sector, and it simply would create unfair advantage for a government entity."

O'Keefe reported late yesterday on his blog that "the White House is planning to present a financial rescue plan for the U.S. Postal Service in the coming weeks as part of a broader, $1.5 trillion deficit reduction package, it said Tuesday. In advance of those recommendations, the Obama administration is asking Congress to give the Postal Service a 90-day extension to pay mandatory annual retirement payments totaling about $5.5 billion."

Also in this program, cloaking devices! Not just in "Star Trek." Defense contractors are testing ways to cloak tanks to make tanks look like cows.

About the author

John Moe is the host of Marketplace Tech Report, where he provides an insightful overview of the latest tech news.

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