lowecur
Well-known member
- Joined
- Sep 14, 2003
- Posts
- 2,317
I guess Senator Kay just can't stand a bill being scrutinized by the DOJ prior to getting it passed. Afterall, gov't bills are all about compromise. Lets just bury it in a transportation bill where everyone gets their little piece of the pie, and no questions will be asked. Well the DOJ was right to raise issues now. Afterall, once this legislation is passed, it is exempted from all anti-trust issues in the future and may be setting a precedent for future bills of this type. Hopefully, this backfires on Sen Kay and a better bill will come out of it that will serve all interested parties.
imp:
Posted on Wed, Aug. 02, 2006
Let critics of Wright deal have their say
By Mitchell Schnurman
Star-Telegram Staff Writer
Who's afraid of a little justice? We're finally getting a real two-way conversation on the Wright Amendment compromise -- antitrust warts and all, not just platitudes -- and a key Texas lawmaker wants to gag the Justice Department. Say it ain't so, Kay Bailey Hutchison.
On Tuesday, the senator from Texas urged Attorney General Alberto Gonzales and his department to stay out of the Wright debate, saying they'd been undermined by a leaked memo that criticized the plan.
"Allowing the Justice Department to review this matter would be equivalent to sending one to trial after the court had announced the verdict," Hutchison wrote in a letter to Gonzales.
Except that the Wright proposal is still a proposal only. Isn't it wiser to review the pros and cons now, before Hutchison's bill becomes law? Rather than strong-arming dissenters to the side, Congress ought to invite them to the table. The chairmen of the House and Senate judiciary committees should ask the Justice Department for a formal review of the compromise and a recommendation.
The department has some of the country's top minds on antitrust matters and airline economics. If they believe the proposal is fatally flawed, as the memo indicates, the public needs to hear about it.
Hutchison can set them straight if the agency lawyers are misinformed. But if they suggest valid ways to improve the deal and boost competition, we should weigh those, too.
The takeaway line from the memo leaked last week: "We would urge Congress not to pass the current legislation but to wait until the deal can be reformed so that the laudable procompetitive objectives of repealing the Wright Amendment restrictions are not undermined by all these anticompetitive side agreements." In other words, no deal is better than this one. That's a danging conclusion from a credible source, and it warrants a much deeper discussion of the substance of the agreement.
A lot of people, including me, were thrilled that North Texas leaders compromised on Wright. It's an achievement, but let's not get carried away: The deal points were always heavily tilted toward American and Southwest airlines, at the expense of the flying public and other airlines that don't have much pull in this market.
Most troublesome is the notion of eliminating one-third of the gates at Dallas Love Field. That would leave 20 gates, all leased already, which means that competitors would be locked out or given second-class status. The limits would also impose a short, hard cap on Southwest's growth.
And why penalize Southwest if it wants to add international service at Dallas/Fort Worth Airport? The deal would take away Southwest gates at Love if it expands into D/FW before 2025.
There's also a provision that thumbs its nose at Congress: The parties agreed to honor the compromise details, regardless of Washington's actions. So if lawmakers decide that a five-year phaseout is ample, Southwest would lose up to half its gates if it began service before the eight-year mark.
It's natural that American and Southwest would have a lot of influence in the compromise talks. They dominate air service in the Metroplex, they're major employers and their support was key to any compromise.
But that makes Congress' role as final arbiter even more crucial. The deal's details seem to violate antitrust laws -- the memo calls them "hard-core, per se violations of the Sherman Act" -- and the bill has blanket immunity for the parties.
Congress can grant that immunity but must also weigh the public good versus the public costs. Hearing the Justice Department's concerns is a legitimate part of that process.
Hutchison and other champions of the cause (Mayors Mike Moncrief and Laura Miller and most of the North Texas congressional delegation) have been trying to fast-track the Wright repeal. With a united front, along with American and Southwest, they hoped to win quick approval to phase out Wright and shrink Love. But doing that right is more important than doing it fast.
A Justice Department staffer writing that the deal "narrowly benefits the area's two dominant airlines at the expense of everyone who would benefit from real competition" is a red flag.
Hutchison et al say the compromise can't be tinkered with. Let Love keep more gates open or shorten the phaseout period from eight years and the whole deal could unravel.
Let's hope that Congress calls this bluff. Everybody is on board the compromise train now, and it's going to be tough to jump off.
The Justice Department memo raises serious issues, saying consumers and competitors would get short shrift from the proposal.
American, Southwest, Fort Worth and Dallas should have to counter those arguments with something of substance.
When people criticize the details of the Wright compromise, advocates are quick to say that no compromise is perfect. True enough, but this is more imperfect than it has to be. And Congress can make it better.
imp: Posted on Wed, Aug. 02, 2006
Let critics of Wright deal have their say
By Mitchell Schnurman
Star-Telegram Staff Writer
Who's afraid of a little justice? We're finally getting a real two-way conversation on the Wright Amendment compromise -- antitrust warts and all, not just platitudes -- and a key Texas lawmaker wants to gag the Justice Department. Say it ain't so, Kay Bailey Hutchison.
On Tuesday, the senator from Texas urged Attorney General Alberto Gonzales and his department to stay out of the Wright debate, saying they'd been undermined by a leaked memo that criticized the plan.
"Allowing the Justice Department to review this matter would be equivalent to sending one to trial after the court had announced the verdict," Hutchison wrote in a letter to Gonzales.
Except that the Wright proposal is still a proposal only. Isn't it wiser to review the pros and cons now, before Hutchison's bill becomes law? Rather than strong-arming dissenters to the side, Congress ought to invite them to the table. The chairmen of the House and Senate judiciary committees should ask the Justice Department for a formal review of the compromise and a recommendation.
The department has some of the country's top minds on antitrust matters and airline economics. If they believe the proposal is fatally flawed, as the memo indicates, the public needs to hear about it.
Hutchison can set them straight if the agency lawyers are misinformed. But if they suggest valid ways to improve the deal and boost competition, we should weigh those, too.
The takeaway line from the memo leaked last week: "We would urge Congress not to pass the current legislation but to wait until the deal can be reformed so that the laudable procompetitive objectives of repealing the Wright Amendment restrictions are not undermined by all these anticompetitive side agreements." In other words, no deal is better than this one. That's a danging conclusion from a credible source, and it warrants a much deeper discussion of the substance of the agreement.
A lot of people, including me, were thrilled that North Texas leaders compromised on Wright. It's an achievement, but let's not get carried away: The deal points were always heavily tilted toward American and Southwest airlines, at the expense of the flying public and other airlines that don't have much pull in this market.
Most troublesome is the notion of eliminating one-third of the gates at Dallas Love Field. That would leave 20 gates, all leased already, which means that competitors would be locked out or given second-class status. The limits would also impose a short, hard cap on Southwest's growth.
And why penalize Southwest if it wants to add international service at Dallas/Fort Worth Airport? The deal would take away Southwest gates at Love if it expands into D/FW before 2025.
There's also a provision that thumbs its nose at Congress: The parties agreed to honor the compromise details, regardless of Washington's actions. So if lawmakers decide that a five-year phaseout is ample, Southwest would lose up to half its gates if it began service before the eight-year mark.
It's natural that American and Southwest would have a lot of influence in the compromise talks. They dominate air service in the Metroplex, they're major employers and their support was key to any compromise.
But that makes Congress' role as final arbiter even more crucial. The deal's details seem to violate antitrust laws -- the memo calls them "hard-core, per se violations of the Sherman Act" -- and the bill has blanket immunity for the parties.
Congress can grant that immunity but must also weigh the public good versus the public costs. Hearing the Justice Department's concerns is a legitimate part of that process.
Hutchison and other champions of the cause (Mayors Mike Moncrief and Laura Miller and most of the North Texas congressional delegation) have been trying to fast-track the Wright repeal. With a united front, along with American and Southwest, they hoped to win quick approval to phase out Wright and shrink Love. But doing that right is more important than doing it fast.
A Justice Department staffer writing that the deal "narrowly benefits the area's two dominant airlines at the expense of everyone who would benefit from real competition" is a red flag.
Hutchison et al say the compromise can't be tinkered with. Let Love keep more gates open or shorten the phaseout period from eight years and the whole deal could unravel.
Let's hope that Congress calls this bluff. Everybody is on board the compromise train now, and it's going to be tough to jump off.
The Justice Department memo raises serious issues, saying consumers and competitors would get short shrift from the proposal.
American, Southwest, Fort Worth and Dallas should have to counter those arguments with something of substance.
When people criticize the details of the Wright compromise, advocates are quick to say that no compromise is perfect. True enough, but this is more imperfect than it has to be. And Congress can make it better.
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