Continental Airlines Chairman and CEO Larry Kellner told the Houston Chronicle that “if the government wanted to re-regulate the business, I wouldn’t be opposed to it.” He continued, “what we’ve got today doesn’t work. It isn’t creating a stable industry.”
Further on in the interview, Kellner said, “the structure of the [Railway Labor Act] creates a very cumbersome process” for managing labor costs.
Let’s see, on the face of it Kellner wants to substitute more government control to help with government imposed rules, designed to “stabilize” labor contracts, that hinder his freedom to operate.
Though the Continental CEO has gotten headlines on the subject of re-regulation every so ofter over the past year, his version of re-regulation is tame. It is really a realignment of and subtle changes to current rules.
Heck, the government hasn’t managed to manage any area of their part of the airline deregulation system and basic traveler protections.
• As Kellner notes, where government rules are involved, such as with labor negotiations, they are “cumbersome.”
• Updating the air traffic control system (ATC) has only gotten lip service for decades, even through every part of the industry and the government agrees the country needs ATC modernization. Re-regulation won’t change this.
• Management of the ATC is abysmal. Air traffic controllers are up in arms after being abused by the agency responsible for managing our aviation infrastructure. Re-regulation only means more of the same.
• The FAA reauthorization process to fund the limited portion of the industry under government control is torturous and has been unsuccessful recently. Reregulation will only add to the complexity that Congress has proven incapable of handling.
• Airline passenger bill of rights legislation can’t make its way out of Congress, even when the primary mission of Congress is to stand on the side of consumers, prevent their abuse and provide clear rules for the industry to follow. Congress can manage plenty of rules for advertising, toys and welfare programs. Where are they for travel consumer protection?
• The Department of Transportation is allowing the Essential Air Service Program that guarantees service to smaller rural airports to crumble as airlines pull back service. Here, government has plenty of regulation authority, but squanders it.
• Even the Federally-imposed bankruptcy laws, that allow airlines to fly indefinitely under Chapter 11 protection and shed their debts and obligations, hinder any real meaningful change to our air transport system.
Anyone who has witnessed the battles between lobbyists representing various interest groups in Washington cannot be in favor of re-regulation. Innovation would grind to a halt. Our airline system would go the way of the American railroads.
Competition between the airlines will regulate itself; the government needs to stick to its knitting with national efforts such as modernizing the ATC, a workable Essential Air Service program, and protecting consumers and workers (including pension guarantees and medical care). Allow the airline industry to duke it out on the economic playing field.
We need a system that can adapt to changes in oil prices, economic shifts, passenger demand and airfares. Re-regulation is clearly counterproductive. With the staggering economic changes buffeting our economy and the world’s economy, re-regulation will stifle innovation and flexibility.
It is designed, by its nature, to do just that: prevent change.
