Postal Service Warns It Could Lose $18 Billion a Year

In a letter to Congress, Patrick Donahoe, the postmaster general, described an updated five-year cost-cutting plan put together in coordination with a Wall Street adviser, Evercore Partners. It reiterates many of the mail agency’s proposals to switch to a five-day delivery schedule, raise stamp prices and close about 252 mail-processing centers and 3,700 local post offices.

The Postal Service has already asked Congress for permission to make service cuts and reduce annual payments of about $5.5 billion in funding retiree health benefits. But in recent weeks, the Senate and House have stalled as lawmakers differ widely on costs, the level of financial oversight and the prospect of widespread postal closures.

On Thursday, Mr. Donahoe said the mail agency’s proposals would enable it to save $20 billion a year by 2015, repay its $12.9 billion debt to the Treasury and return to profitability. The plan, for instance, notes that if the post office could raise stamp prices from 45 cents to 50 cents, either in a single year or over a multiyear period, it could bring in new revenue of about $1 billion.

In contrast, Congressional inaction would result in significant annual losses and a “long-term burden to the American taxpayer.”

In a news briefing, Joe Corbett, the chief financial officer, said that no formal proposals had been made to increase the price of a first-class stamp. He said the plan described the additional revenue the mail agency could realize over a single or multiyear period if it could increase stamp prices above the rate of inflation.

Since 2006, the Postal Service has increased the price of the stamp four times, from 39 cents to 45 cents.

About half of the Postal Service’s cost-cutting proposals require legislative approval. Some Congressional proposals have focused on providing short-term relief through a cash infusion to prevent the mail agency’s bankruptcy but also postpone major decisions on cuts until later.

Last week, the Postal Service said its quarterly loss rose to $3.3 billion amid declining mail volume and said it could run out of money by October.

The agency forecasts a record $14.1 billion loss by the end of this year.

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White House Proposes $5 Billion in Grants to Overhaul Teaching

The new program, which needs Congressional approval, is part of President Obama’s budget proposal and expands upon a call in his State of the Union address last month to give schools more resources “to keep good teachers on the job and reward the best ones.”

Federal education officials said the program would seek to bring together state and district officials, union leaders, teachers and other educators to address a range of issues, among them tightening tenure rules, increasing salaries and improving professional development.

The secretary of education, Arne Duncan, will formally unveil the proposal at a meeting with teachers on Wednesday in Washington. He plans to enlist teachers from an Education Department fellowship program to help promote the proposal, called the Respect (Recognizing Educational Success, Professional Excellence and Collaborative Teaching) Project.

“Our goal is to work with teachers in rebuilding their profession and to elevate the teacher voice in federal, state and local education policy,” Mr. Duncan said in a statement.

The new program would follow the general format of Race to the Top, with states designing their own proposals for teacher improvement and the federal Education Department selecting the most promising ones for multiyear funding. It would focus only on teaching, though, while the Race to the Top program had a broader agenda for kindergarten to 12th-grade education.

Officials said the new program, which has been in development for a year, was not a response to any current efforts to install teacher evaluation systems in specific states, including New York. They said it was intended to address the needs of experienced teachers and to make the teaching profession more appealing over all — through salary increases, more selective teacher colleges and other measures — to attract a new generation of teachers.

“We need to change society’s views of teaching from the factory model of yesterday to the professional model of tomorrow, where teachers are revered as thinkers, leaders and nation-builders,” Mr. Duncan said. “No other profession carries a greater burden for securing our economic future.”

Dennis Van Roekel, president of the National Education Association, the nation’s largest union of teachers and education professionals with more than three million members, said he supported the Obama administration’s wide-ranging approach to a systemic problem. He said he had long emphasized the need for attracting top-tier teaching candidates, maintaining competitive salaries and promoting professional development.

“It incorporates what we believe is necessary to transform the system,” Mr. Van Roekel said. “We need to do all of these things.”

Timothy Daly, president of the New Teacher Project, a nonprofit group that recruits new teachers for school districts, including New York City, said the use of a competitive grant program would encourage states to come up with innovative ideas.

“Teachers are treated as interchangeable parts — they’re not honored as highly skilled professionals — and this has gone on for decades,” he said. “Everyone knows we have to make teaching better, but they have put their money where their mouth is.”

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