Millions of Americans do not live near banks and are forced to use high-interest payday loans services, according to the United States Postal Service Office of Inspector General (USPS OIG). Since the USPS already offers money order services, the USPS OIG is proposing partnering with banks to "expand its offerings."
A "white paper" issued by USPS OIG offers more details. Since many Americans, 34 million according to the paper, are "underserved" by traditional banking institutions, the Postal Service could "fill the gaps" to meet those needs.
One way would be through payment services, including bill payments, e-commerce payments and small loans. They would even offer a reloadable "Postal Card" which could carry balances and be used at ATMs. Not only that, but by partnering with banks, the Postal Service could "encourage savings" by offering interest-earning savings account on their Postal Card.
The USPS OIG paper says these services could "help the overall economy." By offering "Postal Loans," a user would not have to rely on costly payday loans and use the lower interest Postal Loan -- saving them hundreds of dollars which could lead to less bankruptcies.
This would all be laughable if it were not printed in an official publication. Personal responsibility is missing from the proposal. No where does it say that most people using payday loan services do so because they overspend money and do not live on a budget. As is the case with most government programs, they are "victims" of some injustice -- they are "forced" to use a payday loan center. That is a good line for big government though, because they can then swoop in and provide another service to help them out of their mess, not realizing that unless a person changes their spending habits, they will be indebted to Uncle Sam as opposed to the payday loan center. The names may not be the same but the debt habit is.
Not surprisingly, politicians are starting to eat this up and none other than Massachusetts Senator Elizabeth Warren is first in line. She wrote in a Saturday special to the Huffington Post about these new post office proposals saying the USPS may even "shore up its own financial footing" because of them.
Sen. Warren hopes to recruit others to join her in this "innovative idea:"
The Postal Service is huge -- employing more than a half million people -- and its history is long and complicated. Any change will take time. But this is an issue I am going to spend a lot of time working on -- and I hope my colleagues join me. We need innovative ways to create pathways for struggling families to build economic security, and this is an idea that falls in that category.