Should U.S. Privatize Air Traffic Control System? Column: No: More Competition Needed Across Airline Industry
July 1, 2017
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  • PRESIDENT Trump has it right about one thing. The nation’s air traffic system is an important part of our America’s transportation infrastructure. But his approach to improving it, privatization, is the wrong legislation at the wrong time.

    The management of the system itself isn’t necessarily the problem. It’s that the airline industry, through years of mergers, 12 since 2005, is no longer competitive. Giving the few airlines that dominate the industry power over the system itself, through a private corporation that they would run, isn’t the answer. More competition is.

    Ten years ago, there was a dramatic all-day hearing of the House Aviation Subcommittee on the merger of Northwest Airlines and Delta. The full committee chairman, Rep. James Oberstar, D–Minn., took a special interest in the trend towards airline mergers. He asked each witness, “Wouldn’t it lead to reduced competition and the possibility of reduced quality of service and higher charges?”

    It was a good question. The airlines thought there was nothing to worry about. Even the Justice Department, which enforces anti-trust legislation, saw no major issues. But they all had it wrong.

    Today, four airlines control 68.8 percent of the domestic air travel market.

    This has made it easier to reduce the quality of service and jack up the prices, even when costs such as the price of jet fuel was going down. And they treat customers like boxes of freight, or worse. It’s also a lot easier to cancel flights or fail to invest in updated computer systems because passengers rarely have any alternatives. 

    Reform is desperately needed. Break up some of these markets and allow more airlines slots at large regional and national hubs, and service will change. It’s fundamental economics.

    However, airlines don’t like competition. That’s why they went to such great lengths to consolidate. Yes, they got more stable profits and don’t have to worry so much about uppity start-ups undercutting their strong money-making routes.

    Congress has had hearings about the way passengers are treated, particularly when they’re removed from flights due to overbooking. That’s just a symptom. Airlines treat passengers badly because they can. If there was more competition, it would be a different story.

    However, with the airlines leading the way, the not-so-new proposal touted by the Trump administration is to take aim at the Federal Aviation Administration and the air traffic control system itself. That’s the entire personnel and technical infrastructure that keeps America flying. It’s massive, highly technical, and has an unmatched safety record.

    Advocates for this move say it will make it easier to modernize and to be more efficient. What it really means is that airlines that would be on the board of directors of this new company would be able to run the system as they see fit. Namely for their benefit. The voices of business aviation and general aviation might be lost altogether.

    One of the arguments the airlines make for wanting to privatize the system is that it will make it easier to implement the Next Generation Air Transportation System. This is a large-scale transformation of the system from our current passive and active radar detection systems to one where satellite-based displays, using GPS-type inputs, make pilots aware of where they are in relation to other aircraft and vice versa.

    It’s neat stuff. But it also has a lot of moving parts. And contrary to what the industry often says, the new technolo-gies implemented by the FAA are already doing a lot of good. Thanks to more direct routing and the ability to handle more airplanes in high-traffic areas, operations have significantly improved. In other words, the money invested so far has yielded benefits, and transforming a system that carries over 700 million passengers a year takes time.

    Another question is who regulates the system. The FAA has worked hard to build a safety culture. Would a privatized system, watched over by the FAA, have such a strong focus on safety? Or would it be so pressed to “push tin” that it might become easier to cut corners?

    Congress, in looking at ways to improve the way we fly, seems to be focused on the wrong things. A privatized system sounds like a nice idea, but when given any kind of scrutiny, seems like just another power grab on the part of the airline industry to dominate every aspect of an already overly concentrated industry.

    If flying is ever again to be something Americans look forward to, what we need is more competition in the industry itself. Not privatization.

    David S. Kerr,

    a Stafford County resident, has worked on Capitol Hill and for federal agencies. He is an instructor in the political science department at Virginia Commonwealth University.