Cabotage Sabotage

[Pura Vida]

The issue here is holding onto jobs for U.S. pilots. No argument can be made that cabotage would not detrimentally affect that. Our industry has already gone 13 rounds with Mike Tyson (so to speak before someone takes that out of context). Our contracts have been diminished; we have management walking all over us, and competition from other domestic carriers keeps coming. Now add to the mix if you will, a foreign carrier with even cheaper labor costs and standards. In the constant race to the bottom that this industry has seen, what will happen? The spiral will tighten. How anyone can make an arguement that cabotage will not hurt the U.S. domestic airline industry is beyond me. Airline pilots have kept cabotage out of our country every time it has been brought up. But now, with Fuheur Bush at the helm, he and his corporate cronies have finally got it pushed through for the airline cargo sector. Do you honestly think the passenger sector could be that far off? Don't wait until it's too late...fight it now!

hey Rock...keep hurling your propaganda insults. ANY democrat in the field would be better than the robber baron in the white house right now. Sure, I support Dean because he supports the average citizen. I also support Gephardt because he is a strong labor union candidate. If you knew anything about politics than you would understand that the front-runner; who was the black sheep of the group at one time (Dean) is going to get rocks thrown at him from all sides going into the primaries. Par for the course. As for your comment about Bush being such a highly admired man - Where did you get that from? The Rush Limbaugh radio network?

 

[Pez D. Spencer]

Pura Vida,

I share your enthusiasm in protecting American jobs.

A little Challenge/Response... all these quotes will be from your last post.

The issue here is holding onto jobs for U.S. pilots. No argument can be made that cabotage would not detrimentally affect that.

I don't think that cabotage, alone, will have a major affect US jobs, if any. Think of the economics at play here. The foreign air carrier will have to have addtional crew member compliments on board the aircraft (using T-Bags example from Cairo) to LA... for the flight to LA. Then, they have to have another rested crew here in the US waiting to fly the leg to NY. Next they have to have additional crews to continue back to Cairo. Not just pilots, but FA's as well (lotta FA's on 747). Remember, when operating to/from/in the US they will abide US FAR's. Now, what about fuel. Who do you think will get a better fuel price in NY, Egypt Air or Delta (with a hub there)? Other expenses exist as well, but I'll keep it short. Bottom line, can Delta compete with that? Sure.

That trans-con US segment may seem like a small portion of the overall flight... but, the costs would still be cheaper for a US based crew on a US based airline. US airlines would face similar challenges abroad.

Our contracts have been diminished; we have management walking all over us, and competition from other domestic carriers keeps coming.

1. Because some pilot groups take concessions (or have had to in order to prevent bankruptcy) and some let themselves get walked on. 2. Competition is inevitable.

Now add to the mix if you will, a foreign carrier with even cheaper labor costs and standards. In the constant race to the bottom that this industry has seen, what will happen? The spiral will tighten. How anyone can make an arguement that cabotage will not hurt the U.S. domestic airline industry is beyond me. Airline pilots have kept cabotage out of our country every time it has been brought up.

Once again the standards in the US will be, at minimum, those required by the FAR's. Fighting the threat of foreign airlines operating on US soil is the job of our management counterparts. If they saw a real threat to their bottom line, they would not be silent. To think that US airlines' management would allow or support cabotage as a means of routing out US labor - well, that's a bit overboard on the conspiracy theory.

Traditionally, US ailines have been favored in even the "open skies" bilaterals that have been formed (which are still limited - not truly "open skies"). This is true, inasmuch as we've always gotten more freedoms out of the deal than the other country's airline(s).

Remember, my argument here is based on cabotage, alone, as one right granted to foreign airlines. Not the broader issue of nationality/ownership and the implied relaxing of US labor laws. Not to sound like a broken record, but IMO the latter point is what we need to focus on to prevent the loss of US jobs. Not to mention that this is where US labor unions can have the greatest impact.

We can agree to disagree... Fighting cabotage from a security standpoint is great - with an ulterior motive or not - but, when or if labor laws come up for review (it will have to go through Congress) -- fight just as hard against that too. If cabotage is allowed (once again, only cabotage), will it be the end of the American dream? Probably not.

 

[Publishers]

I don't think you got it.

I am afraid you do not really understand how the elimination of cabotage would work. The danger is not from pilots working for cheap because they come from a foreign land.

The danger has always been that many of these airlines are subsidized by the governments. The danger is that they take US based customers on their extended legs at below cost rates merely offsetting current losses.

The only way US airlines get hurt is loss of a segment because it becomes uneconomical.

Secondly, you are missing that we may get more out of this than we give. We are the marketplace with feed systems. If they can buy American companies, we would be able to buy foreign carriers as well.

You are issue myopic. While I was with Evergreen, we flew for Saudian Arabian Airlines, we flew for Quantas and other carriers with our 747 freighters. American Pilots flying foreign carrier flights.

 

[Pez D. Spencer]

Well Publishers,
If you had your paws in negotiating fifth freedoms, then no doubt, I could learn a thing or two from you about the issues.

Relating to cabotage...
I realize the threat is not cheap labor - my point, US airlines could compete with foreign airlines inside the US, cost-wise (given a level playing field) and without threatening salaries or jobs.

Now, subsidies are a different matter. That would constitute an unfair position on the part of the subsidized airline. Isn't that one of the EU's main arguing points - that they believe that US airlines are unfairly subsidized? By the "Fly American" policies and government funding (which they, the EU nations, have also engaged in post 9-11). Both sides have arguments of that sort. I do believe that is part of the current negotiations - that subsidies would have to be eliminated in order to for both sides to compete legitimately. Otherwise, anti-competitive regulations would also have to be rewritten, which will not happen.

As for getting more out of it than we give... like I said, traditionally US negotiators have attempted to position US airlines for just that. But, I do think US airlines will face challenges of the same accord to position themselves for those gains abroad. Can they afford that right now - even as an investment for the future..?

A complete discussion of the matter would require a tremendous amount of time - so, myopic... yeah, I'll grant you that. Most of the discussion here is narrow. For my part, I too am concerned with the job protection aspect. IMO, labor laws, which the EU is asking for changes to with regard to ownership/nationality is the concern - not cabotage.

Your first sentence gets me though. How the elimination of cabotage would work... Explain what you mean by that - as a postive? or negative? Or, just explain what you think I'm not connecting on here (not issued as a challenge to you, rather for debate).

Also worth mentioning, the last point about deals such as Evergreen's wet-leasing, crew included, and the fact that the US allows no such reciprocity has been contested by the EU.

With the myriad of security issues in the last two weeks alone, this debate is likely to be academic at best.

 

[Publishers]

Labor issue

What I was saying is that when you focus on it as a labor issue, you miss the majority of how things would really work. Let me give you some examples/

First, I think that at the time, emphasis on at the time, some of the majors that went down would have been saved had the US allowed foreign investment in airlines past where they did.

You have to go back to the fact that we are one of the most productive economies in the world, that we have a skilled labor force well beyond other countries, that we are supplying pilots to places like Japan which has both the population and technology but needs us anyway, that we through the FAA control the way much of the worlds airways ooperate now.

What you perceive as a threat to labor regulation is not much of an issue in the bigger picture. Furthermore, we rarely go back to where we were. Look at the history. The pilot profession is not what it was before and probably will not be again. The whole industry is mature. Something new today in this industry is a .004 percent better fuel to speed ratio or some other minor gain through navigation technology or drag reduction or more seats, etc.

Just as the original astronauts were heroic idols to be held in high esteem, today it is a bit of routine even though the deaths over Texas reminded us of the danger. The fact that AirTran, Jetblue, and SWA sort of thrived during the time other were failing pretty well signaled the end of doing things the way we were.

My son looks forward to a career flying. Being an old guy, I know that today, those that look up might be like the railroad people the first time a plane flew over. By the time he is ready, there may not even be airlines.

 

[VADriver]

Pez D. Spencer and Publishers,

Your intellectual, non ego based posts are refreshing.

Please provide your own comparative analysis of the maritime industry and the Merchant Marines with the same potential outcome for the airline industry and the piloting profession.

Insight needed.

 

[Publishers]

Marine

I am not sure that you can really compare the two. For example, the difficulty of marine laws versus air equivlents. Skilled labor versus non skilled labor. Insurance effects, etc/


In these kinds of discussions, there will always be the greater good aspect. What is good for the most. In the maritime industry, most of which was implemented before we even thought about such things, we have created a situation where many vessels are registered under foreign flags for liability reasons.

The topic of cabotage is closer to a domestic situation where maritime is related to access to ports, not internal routes.

My contention is that we will eventually gain more than we give in any negotiation of freedoms. Because we set the international standards of flight for commercial purpose, because we have the people of skill necessary, because we have the economy to lead rather than follow, we will usually be better served by the expansion of opportunity to service.

 

[Pez D. Spencer]

I'll give it a shot...

There are more differences than similarities. Comparisons are difficult because maritime cabotage laws prohibit all but US registered ships operating with US crews to carry cargo or pax between two US ports (including operating on inland waterways and the Great Lakes) - not exactly what has been proposed in aviation. The "Jones Act" has been around for ages and is not losing any ground politically while government granted exceptions are rare.

The cost of regulation in the shipping industry has made it cheaper to operate under foreign registry - with foreign laborers working for/under substandard wages, work rules, and conditions. Whereas in aviation (internationally), regulations tend to follow closely with US FAR's and ICAO standards. At any rate, while operating in the US, the standards will be those prescribed by the FAR's.

The staunch supporters of the maritime cabotage laws cite job protection and national security as their major arguments... supporters like the AFL-CIO and the DOD. The majority in our government favor keeping those laws in place, including support from the White House. Their support of keeping the maritime status quo is also somewhat of a contrast to the aviation proposal to grant eighth freedoms, while the national security argument is closely paralleled.

Another argument for keeping maritime cabotage laws in place is that it promotes the US shipping businesses that face tougher controls - forcing higher prices, lower margins, and thinner revenues in international shipping. This also differs in aviation as the US carriers seem poised to gain from changes rather than lose. And, US carriers are not on the ropes with regard to international traffic.

soapbox time...
As for what will cost jobs in the US - according to a Yahoo! news article today, the prez wants to ease border restriction and increase the allotment of visas and green cards - all the while many americans are unemployed. Bush says this proposal will "bolster the economy by meeting employers' need for willing low-wage workers." Just what we need. How this bolsters the economy or raises the US standards of living is beyond me - I think it just makes a segment of the population willing third world workers in a first world economy and, further, allows suppression of wages. If this is allowed to trickle into mainstream employment venues in addition to orchard labor, then to paraphrase a supreme court justice (speaking about foreign influence on US law), we will be "making changes to the constitution of a country which I do not recognize." Inevitably, it will trickle through - if not immediately. To think pilots are immune would be blind. And why is Bush proposing this? To get the hispanic vote..? Shouldn't that be the American vote?

 

[Publishers]

Rant

Without getting off on a rant like Dennis Miller, there are not easy answers all the time.

In the big picture of things, we are getting a more global economy--like it or not. We have not been able to isolate ourselves very well in any of the industries I can think of right away. Protectionism and isolationist will not likely win in the end. Thus there will be a global adjustment of wages and productivity.

We can groan about the low wage labor coming across the border but the fact is that if the people do not come, the products will. In short, we will and do take the products manufactured where the low cost labor is.

We could not protect the auto business and if we could not do that, forget trying the airline one.