US Postal Service warns it could default
The US Postal Service warned on Friday that it could default on payments it owes the federal government, just days after the US government itself narrowly averted a default.
The government's mail service said it lost $3.1 billion in the period from April to June, blaming "the anemic state of the economy" and the growing popularity of electronic communications over old-fashioned letters.
As a result of its mounting losses, the US Postal Service said it would not be able to make a legally required $5.5 billion payment in September to a health-benefits trust fund.
"Absent substantial legislative change, the Postal Service will be forced to default on payments to the federal government," it said in a statement.
Dating back to 1775, the US Postal Service was once a crucial branch of the federal government, but in recent years it has come under increasing fire from critics who consider it bureaucratic and inefficient.
In July, it unveiled plans to identify nearly 3,700 under-used post offices around the United States for possible closure. The Post Office has been hemorrhaging billions of dollars in recent years.