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Archive for October, 2008

The Justice Department announced today that its Antitrust Division has found that “the proposed merger between Delta and Northwest is likely to produce substantial and credible efficiencies that will benefit U.S. consumers and is not likely to substantially lessen competition.” This clears the way for Delta and Northwest to merge officially. It was not an unexpected decision.

Justice says that the combined airline will face competition from other carriers on the “vast majority” of its nonstop routes. Furthermore, it adds, “the merger likely will result in efficiencies such as cost savings in airport operations, information technology, supply chain economics, and fleet optimization that will benefit consumers. Consumers are also likely to benefit from improved service made possible by combining under single ownership the complementary aspects of the airlines’ networks.”

I’ll reiterate what I said about the merger back when it was announced: There was no reason to block it on business or policy grounds, but the business case for merging was weak.

The Associated Press reports that the merger faces a lawsuit set to go trial next week in San Francisco. See also my previous blogging on the Delta-NWA tie-up and “merger mania 2008.”

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Can’t get enough of the Aviation Policy Blog? Want to listen to me geek out and generally make a fool of myself for an hour? Then listen to this week’s Airplane Geeks Podcast! We talk a lot about the thirtieth anniversary of deregulation, but we touch on a number of other matters, too.

Thanks to Max Flight and Courtney Miller for inviting me to join them on the podcast and for putting together an outstanding weekly program.

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Lots in the news today. . . .

  • Boris Johnson, the mayor of London, wants to build a new London airport on an island and in the frickin’ North Sea. Seriously. Don’t get me wrong, I love BoJo, but this is taking a perennial white elephant and turning it into white whale. Or something like that. [Independent, Towers and Tarmacs]
  • ACI-NA president Greg Principato comments on how the presidential candidates will think about aviation if elected. [Airport Check-In]
  • Benet Wilson has a podcast with Alfred Kahn, who chaired the Civil Aeronautics Board during airline deregulation thirty years ago. [Things with Wings]
  • Speak of the devil, why do we care about airline deregulation at all now? Adrian Schofield writes that we’re in no danger of reregulating the industry. Well, one reason to debate it is to set the record straight. [Things with Wings]
  • The international airline trade group has just concluded a meeting promoting international deregulation multilateral aviation treaties. [finchannel.com]
  • Nicholas Sabatini, the top safety official at the FAA, is being replaced by Peggy Gilligan in 2009. [Things with Wings]
  • Here’s a “cranky” take on the announcement that the TSA will deploy “Secure Flight” next year. [The Cranky Flier]
  • Aviation is set to be included in the European emissions trading scheme starting in 2012. [ATW Daily News]
  • And finally, the U.S. has completed open skies agreements with Armenia, Laos, and Vietnam. So, who’ll be the first to fly the popular LAX-Vientiane run? What about Dulles-Yerevan? Anyone? [John Macilree's Weblog]

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One of the blogs I read for fun is the Comics Curmudgeon, whose author, Josh Fruhlinger, has a love/hate relationship with the daily funnies (or not-so-funnies). Today, Mary Worth — a comic I shunned as boring in my childhood, only later to realize that it is boring for adults, too — takes on airport security and New York City air traffic congestion:

Would Mary be in favor of congestion pricing, I wonder?

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My story in The American magazine is now up on its website. Here’s the lede: “Thirty years ago this October, the era of affordable mass air travel was unleashed. Why was this revolution stalled, and what can be done to finish it?”

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Top policy advisers to Barack Obama and John McCain differed on key transportation issues at a forum in Washington this morning, but they agreed, in the words of McCain adviser Douglas Holtz-Eakin, when it comes to transportation, “the ratio of importance to discussion on the campaign trail is high.”

Mortimer Downey

Downey

Mortimer Downey, Obama’s senior transportation adviser and Bill Clinton’s deputy secretary of transportation, emphasized Obama’s detailed transportation plan, which I blogged about here. “I can’t recall a candidate who’s put together such a full-fledged transportation plan,” he said. Among the infrastructure problems the next president will tackle will be to “have an air traffic control system that works.”

Downey identified three “vehicles” through which Obama would improve transportation: First, a short-term boost in spending to create jobs and provide economic stimulus. Second, a ten-year, $60 billion “National Infrastructure Reinvestment Bank.” Third, a federal highway spending bill (due next year) with fewer earmarks and a systemic approach.

Douglas Holtz-Eakin

Holtz-Eakin

Holtz-Eakin, a former director of the Congressional Budget Office, spoke of McCain’s agenda (or lack thereof) in two categories: process and the federal role. On process, he noted McCain’s opposition to all earmarks and his support for economic review, return-on-investment analysis of transportation projects, and “performance and accountability measures.” Holtz-Eakin emphasized the need to identify properly the federal role in transportation planning and spending in relation to local and state agencies and “the important role of the private sector.”

As for Obama’s National Infrastructure Reinvestment Bank, Holtz-Eakin said “it isn’t something [McCain] supports . . . very reminiscent of Fannie Mae and Freddie Mac.” (more…)

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Here’s your daily briefing on aviation policy news:

  • In the handsomely redesigned November issue of The Atlantic, Jeffrey Goldberg exposes the uselessness of airport security. He carried tons of forbidden items onto planes and lots of not-forbidden but suspicion-arousing paraphernalia as well. Since much of it seems targeted at making us feel safe, articles like this undermine the entire security apparatus. There’s commentary here and here (at the latter link: “I suppose you could say that a real terrorist about to attempt a hijacking would be smart enough not bring his al Qaeda T-shirt or inflatable Yasir Arafat doll with him; so maybe the TSA was right to overlook those items.”). [The Atlantic]
  • Airlines justified their truckload of new fees as necessary due to the escalating cost of fuel. As prices come down, will the fees go away? Now Congress is getting involved. Side note: Senator Bob Menendez (D-N.J.) says, “Now is not the time for Americans to be priced out of traveling—that is simply unfair to families who want to spend the holidays with their loved ones and it is bad for our economy in need of a boost.” Wouldn’t political pressure to keep fares low be bad for an airline industry in need of a boost? Just sayin’. [Upgrade: Travel Better]
  • Bill Swelbar recognizes the thirtieth anniversary of airline deregulation. Today he focuses on some of the drawbacks of deregulation. “Airlines have a long way to go before they find a sustainable operating model that manages to ‘feed’ various stakeholders. In some circles there are calls for re-regulation. But this ignores the fact that the federal government already heavily regulates this so-called ‘deregulated’ industry, so it is unlikely that further regulation is the answer.” [Swelblog.com]
  • In a rare reverse attributable to a recessionary economy and high energy prices, air passenger traffic continues to fall. [Aero-News.Net]
  • EVENT NOTICE: Tomorrow, National Journal is sponsoring a transportation policy forum here in Washington on the candidates’ positions on the issue. Representatives of both campaigns will be there. You’ll be able to find a report on the event in this space.

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The Aircraft Owners and Pilots Association have released the candidates’ answers (or, more accurately, the campaigns’ answers) to their election questionnaire. One of the interesting points about this questionnaire is that even though John McCain has not articulated an aviation agenda, he/his campaign can draw on his Commerce Committee experience to answer these questions pointedly and with examples. Barack Obama’s answers are vague, inconclusive, and sometimes evasive.

For example:

General aviation airports are an important part of the national air transportation system but are often faced with the threat of closure or limits on access. How will you support general aviation airports as part of the national airport system?

McCain:
If I am elected, one of my top transportation priorities will be to modernize the air traffic control system so it can handle the increased traffic that is forecast. The current system cannot efficiently handle these increases. Gridlock in the sky and on the ground at our airports won’t just result in longer delays for airline passengers, but it will also affect general aviation—especially in the busier airspace around our major metropolitan areas. Under such a scenario, it could become very difficult for pilots to use general aviation airports in that airspace, particularly at peak times. In my view, making better use of the air space won’t benefit just commercial aviation, but general aviation as well.

Obama:
General aviation produces over a million jobs in America and is an invaluable part of our economy and the lifestyle of American families across the nation. As president, I will engage the general aviation community in the FAA decision making process and take steps, as I did as a state senator, to ensure that government continues to determine how best to meet the needs of general aviation practitioners.

On the controversial subject of user fees, McCain points out that the acrimonious debate is harming all parties. Obama says, well, not much of anything: (more…)

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The Wall Street Journal today profiles ICE Air, an airline with service to exotic destinations like Guatemala, Honduras, El Salvador, Jamaica, Indonesia, and Cambodia. It offers leather seats with custom headrests and in-flight service with box lunches. The forty-pound checked baggage allowance is not enforced. It also has high load factors: “We are making a valiant attempt to overbook.” Would you like to fly ICE Air? Well, unless you’re an illegal immigrant being deported to your home country, you’re out of luck:

This carrier is run by U.S. Immigration and Customs Enforcement, the federal agency responsible for finding and deporting undocumented immigrants. A crackdown on illegal immigration has led to a spike in deportations and the creation of a de facto airline to send the deportees home.

The air service, called Repatriate by air-traffic controllers, is known simply as ICE Air to agency employees. . . .

In all, the U.S. government deports people to more than 190 countries. Outside of Mexico, ICE flew home 76,102 illegal immigrants in the fiscal year that ended Sept. 30, up from 72,187 last year and 50,222 two years ago.

Now Boarding: Illegal Immigrants On One-Way Tickets Home [Wall Street Journal]

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A bad start

Just started reading a new report, “Plane Truths,” that I came across through John Macilree’s blog. I’ll write more later, after I’ve finished it, but I’m already put off by the motto of the “think-and-do tank” that produced it: “Economics as if people and the planet mattered.” You know, as opposed to those think tanks that work only in the interest, presumably, of that nefarious, nebulous “business,” or perhaps “industry.” Since, after all, “business” isn’t made up of people at all. It’s not as if “people” work in “business,” or manage them, or perhaps provide jobs for other “people.”

With sophistry this inane, it’s almost as if this “think-and-do tank” is running for president.

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