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The U.S. Postal Service lost $5 billion last year and would have lost double that amount if the government hadn't stepped in to give them a break on pension payments. Total mail volume has declined by 1.7 percent, continuing a downtrend that threatens to wipeout the entire operation, as FedEx and UPS (and email) continue to clean their clocks.

Losses would actually have topped $10.6 billion if company if the government not postponed a required $5.5 billion payment into a retiree pension fund earlier this year. That payment is now due on Friday, but the agency is hoping for another reprieve.

Postmaster General Patrick Donahoe say yesterday that the USPS needs to cut $20 billion from its annual costs in order to become profitable again, but that means undoing most of its union contracts, revamping health and retirement plans and laying off more than 100,000 workers.

None of those options are very palatable, given the current state of unemployment, but without help, the Post Office could go bankrupt as early as next year. They've already lost 130,000 jobs in the past few years and more office are slated for closure. The USPS doesn't receive tax dollars, but still must operate under rules set by Congress that govern price increases and benefit payments. It can't adapt without help from the government, but even if it could, its entire business model (cheap first-class postage) is dying out. The Postal Service may eventually become a nimble 21-century organization, but not without a lot of pain ... and a lot more losses.

This article is from the archive of our partner The Wire.