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If it continues business as usual, the U.S. Postal Service is on track to run out of cash for paying its workers and vendors in about a year and may have to stop deliveries, Postmaster General David Steiner told lawmakers this week.
The warning is the latest development in longstanding money troubles at USPS — a unique federal government agency that relies on stamps and service fees, not tax dollars, to deliver mail and packages six days a week to every address in the country.
“I am not sure that the American public is aware that the Postal Service is at a critical juncture. I know that I wasn’t aware of the extent of it before I took on this role, but at our current run rate and if we continue to pay our required obligations in the same manner as we have done in recent years, then we will be out of cash in less than 12 months,” Steiner, who joined USPS last July, said in a written statement released ahead of a House Oversight Committee hearing on Tuesday.
Since 2007, the mailing agency has been operating with a financial shortfall almost every fiscal year with fewer people and businesses using first-class mail, its most profitable product, amid the rise of paperless billing and digital communication.
“I like to say that in the time since peak 2006 mail volume, the Postal Service was thrown overboard and instead of tossing us a life jacket, we were thrown an anchor,” Steiner said, referring to what USPS has seen as burdensome regulations and requirements.
So far, its multi-year reorganization effort, which started in 2021 under Steiner’s predecessor Louis DeJoy, has not delivered enough efficiencies to stem the financial bleeding.
USPS ended fiscal year 2025 with a net loss of $9 billion. And after finishing its busiest mailing and shipping season of the year in December, it recently posted its fourth quarterly loss in a row ($1.3 billion), partly due to increases in workers’ compensation, retiree health benefit and operating expenses.
Mail deliveries have not stopped, however, because USPS has been able to borrow money from the U.S. Treasury, while holding off on paying some pension obligations in recent years.
But USPS can take on no more debt under federal law, which has capped the agency’s borrowing at $15 billion.
And defaulting on more benefit obligations is not a long-term solution, Steiner told Congress, because at some point, USPS “will no longer be able to maintain operations in the short-term through such defaults, and those obligations that we cannot meet will have to include payments to our employees and vendors.”
That has left Steiner to turn to Congress for help.
Among the changes Steiner is calling for is increasing the Postal Service’s debt limit, which has not changed since 1992, and allowing USPS to raise postage prices beyond the current limits. Reforming its retiree benefit obligations has been another focus of USPS officials.
At a February public meeting of the Postal Service’s governors, Amber McReynolds, who chairs the board, said “policymakers must act urgently to address the structural and statutory cost pressures that continue to weigh heavily on our financial future.”
Past USPS leaders have asked lawmakers to help the mailing agency stay afloat. Most recently, Congress passed the Postal Service Reform Act of 2022, which got rid of a requirement for USPS to prepay future retiree health benefits and canceled about $57 billion in past-due prefunding payments. That law resulted in the only fiscal year in the past two decades that USPS ended without a shortfall.
For its part, USPS is trying to boost revenue this year by starting to take bids from large and small businesses for special shipping rates for its nationwide “last-mile” delivery network. Some industry experts, however, say that could push Amazon and other big shippers to stop relying on the Postal Service and further destabilize the agency.
The Postal Service’s financial struggles have also attracted the Trump administration’s attention, though talk of having the Commerce Department take over USPS, which Congress set up to be an independent agency, has quieted over the past year.
But President Trump is continuing a push to appoint his own picks to the agency’s board of governors, whose politically appointed members are currently all nominees of former President Joe Biden. This month, Trump named three new nominees after withdrawing an earlier nomination last year and having another returned by the Senate.
Edited by Benjamin Swasey
