USPS Default on August 1 Appears Likely

Under a schedule laid out in the 2006 Postal Accountability and Enhancement Act, the Postal Service is also supposed to make a $5.6 billion payment into the retiree health fund at the end of September. “Without congressional action, we will default on both payments,” USPS spokesman Dave Partenheimer said in an email Thursday.

While a default would be embarrassing for the Postal Service, the practical consequences, if any, are unclear. “We will continue to pay employees and suppliers to keep the mail moving,” Partenheimer said. Benefits to current retirees would not be affected.

Lawmakers appear likely to let USPS default, representatives of