Air-Traffic-Control Privatization Not Ready for Takeoff
December 1, 2017
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  • In light of more-pressing problems, the one thing that Congress needs like a hole in the head is a plan to revamp the nation’s air-traffic-control system. After all, safety is not in question. Yet, the airlines, led by U.S. Rep. Bill Shuster, R-Pennsylvania, continue to push relentlessly for air-traffic-control privatization as part of our Federal Aviation Administration reauthorization process.

    There is no dispute that in the U.S., flying is already very safe. We’re in more danger driving to the airport than in the air. So the question remains, what exactly do we stand to gain by privatizing the system? If we can’t answer that question, the FAA shouldn’t be wasting taxpayer resources trying to upend the system.

    Under the Shuster bill, the new organization running air-traffic control would be overseen by private interests; it would be beyond the oversight of Congress and would have the power to set user fees and taxes, and to borrow money. The principal boosters of this plan are most of the major airlines. Opponents include a bipartisan group of rural airports, smaller-aircraft owners and pilots, business aviation, farmers, small business, consumer groups and labor unions, among others.

    There is certainly no lack of unhappiness among airline passengers. And this would only get worse under Shuster’s plan, under which the airlines would have more power within the system. One can find plenty of distress among travelers in Europe, even though European countries have adopted various privatization schemes.

    President Trump supports Shuster’s plan and speaks of our run-down, “Third World airports,” but the plan has nothing to do with the amenities of airports that travelers experience. It’s about the people, facilities, and equipment behind the scenes, directing take-offs and landings.

    Considering the discomforts and inconveniences we endure, relief would be welcome. But we can’t blame the government for terrible food, the proliferation of extra fees, and seats that would make sardines complain. We would like more choices of carriers and more timely departures and arrivals — all of which seems to the fault of the very same people who are trying to say they can run it better.

    Proponents continue to tout new technology — specifically satellites and GPS, which allow airports to handle more flights and improve timeliness. But the FAA is already undertaking technology modernization.

    Resistance to taxes and user fees set by a new entity would still prevail, especially if those with a dominant influence under the new system, once again the airlines, chose to shift more costs to the small fry.

    If you’re worried about the national debt, you might be even more worried about an organization that could do its own borrowing, but whose debts would be implicitly guaranteed by the federal government. Imagine if a new, independent air-traffic-control organization got behind the financial eight-ball, disruptions threatened to stall the nation’s air traffic, and the federal government did not step in with a bail-out. That wouldn’t happen. The Treasury’s money spigots would open to keep the planes flying.

    Fear of this fiscal exposure was one basis for objections to the plan from the American Conservative Union. In the same vein, according to a recent analysis from the Congressional Budget Office, the impact of Shuster’s plan on taxes and the budget deficit cannot be estimated because of the incompleteness of the proposal.

    A taxpayer advocate also might take umbrage at Shuster’s provision to transfer existing FAA assets to the new entity, free of charge. In other countries, airlines have paid for ownership stakes, to compensate the taxpayers.

    There are enough things broke throughout the federal government that ought to command the attention of the Congress. The Federal Aviation Administration is not one of them. In the end, this plan offers a lot to be apprehensive about and not much in terms of tangible benefits that stand up to scrutiny.

    Max B. Sawicky is an economist and writer specializing in public finance and privatization.