Article I, section 8, Clause 7 of the United States Constitution grants U.S. Congress the power to establish post offices and post roads.
This says it all why USPS should exist. I know the free marketeers gone wild, would say otherwise, but the constitution expressly authorizes USPS.
That being said, there are things USPS does that causes waste and the losses like the op stated. In good economic times with high volume of mail, it is profitable, like several years ago, in poor economic times, with lower volume of mail, it is not.
Salaries aren't crazy like other public sector workers but their still above comparable positions in the private sector, I believe salaries are capped at a max of a little over $108,000 a year. I am not sure what kind of pensions or other benefits they get, but I am sure they are pretty darn good as my cousin who works for USPS told me the best part of the job were the benefits and job security and pretty good pay.
I ship alot of stuff being an internet seller, prices at usps for packages are really getting out of hand, the higher the weight, the better the deal shipping it through a private carrier like ups or fed ex if it won't fit in a flat rate box.
The real problem with USPS is they won't scale back where it counts in lean times like these, they'll make you wait in line 30 minutes to mail a package, but they won't cut salaries, some of the people at your local PO are making $20
+/hr to be a glorified cashier. Let them take a 25% pay cut, and if they don't want to, fire them and replace them with me who will be happy to be a glorified cashier with benefits at that rate, since that is 33% more than I make now being an online retailer, without benefits, you won't get that in the private sector as a cashier.