Reregulation?

[BeerNear]

With almost everything in the airline industry going to the poop bucket, do you think the industry should be regulated again by the government? Is is too late? Since I was born in 67 and barely remember airline flights beofre deregulation in 78, how and what strategy would be used to reregulate the airlines?

Take care and fly safe,

BN

 

[bobbysamd]

Reregulation

It would be nice if there was some form of airline reregulation. The conservative mood of the country won't stand for it. In other words, face it, times have changed.

We know most of the abuses, such as inadequate crew rest. But, don't get your hopes up. Unless some extreme catastrophe indicates a need for reregulation, it won't happen. Regulation tends to be reactive, not proactive. In other words, someone has to be killed or something before the government will pass a regulation that forbids incidents that led to the death. Maybe the best, unfortunate, recent example we know of is 911. 60 Minutes ran reports for years on the laxity of airport security. No one paid attention or seemed to care because there were no hijackings. Now, in the wake of 911, we have the TSA and Homeland Security. It took four dastardly hijackings and thousands of lives to get the government's attention long enough to establish what should have already been in place for years.

Don't hold your breath for reregulation. Some will survive the poop bucket and they will be your airline industry.

 

[tdvalve]

"We know most of the abuses, such as inadequate crew rest."

I think the poster is referring to the economic regulations previously administered by the Civil Aeronautics board. The CAB had nothing to do with safety regulations. This was, and still is, the responsibility of the FAA. The CAB was a bureaucracy that approved or disapproved fare changes and doled out routes. The whole system operated much like a franchise with a carrier being assured that their approved route structure would never be subject to competition from another carrier. Further, they were guaranteed profitability because the CAB would approve fare hikes as required to cover all costs plus a profit. Every carrier was profitable because they could charge whatever it took to remain profitable. And, without competition, the passengers could either pay through the nose or take the Greyhound.

 

[enigma]

greyhound

Good points tdvalve.

I was about to point out that the industry was only degregulated in an economic sense. The FAA still controls things such as duty times etc.

You're so right about Greyhound. I imagine that they, Amtrack, motels, and the auto fuel industry, are about the only ones who would want to see a return to regulated skys.

regards
8N

 

[JimNtexas]

I have too many friends who are airline pilots to want to see re-regulation.

In those bad old days airlines flew a small number of half empty airplanes. Most of the passengers were business and goverment types who were not spending their own money. Airlines were competition protected and fares were set as a percentage of captial investment. Airlines like SWA that wanted to operate efficently and compete on price could operate only in their home states.

The result was great for the few people lucky enough to get on the gravy train, but terrrible for everyone else, pilots and passengers both.

A return to economic regulation would result in mass layoffs all across the airline industry and force vacation and small business travelers into their cars.

Jim

 

[bobbysamd]

Re: Reregulation

We know most of the abuses, such as inadequate crew rest . . . .

I stand corrected. This is an FAA issue.

Just the same, I don't feel the mood of the country will stand airline reregulation for the points that tdvalve stated. Of course, degregulation started in the '70s. It enjoyed liberal support from Sen. Kennedy (who, I understand, now regrets his support of it). Go forward a few years to the conservative, anti-union, anti-regulatory movement, and the juggernaut is in place and off and running for deregulation everywhere. Not just airlines, but in other industries, such as broadcasting. The result of that was that only a few gigantic companies own most of the country's radio stations - which has killed competition and has really killed radio (Timebuilder, are you out there?).

The CAB indeed protected airlines, which kept fares high and stymied start-up competition. So, during these golden years of aviation, pilots had it great. Nothing wrong with that, of course, from our perspective. But, (much of) the public likes no-nonsense, inexpensive service, a la Southwest, and competition. And, the public does not like unions and can't stand to hear about well-paid pilots. There are other factors. So, don't hold your breath for the return of airline regulation.

 

[enigma]

Re: Re: Reregulation

Of course, degregulation started in the '70s. It enjoyed liberal support from Sen. Kennedy (who, I understand, now regrets his support of it).

So, during these golden years of aviation, pilots had it great.

Sorry to differ here Bobbysamd, but "pilots" didn't have it great under regulation. Only the ones who happened to be able to land an airline job had it great. Most "pilots" never had a chance to gain an airline job because there were so few airline jobs. Todays generation sees the proliferation of jobs available now, and assumes that it's always been that way; it ain't so. In short, while the life of an airline pilot during the years that the CAB controlled the system was fairly good, the regulated system itself limited the amount of jobs available. In todays industry, the lucky ones fly triple sevens for $350/hour at 70 hours a month, and the unlucky fly RJ's for$35/hour at 70 hours a month. Under regulation, the lucky made the equivelant of $300/hour, and the unlucky drove trucks.

On to deregulation.

The industry and the economy needed airline deregulation, but not in the way it was accomplished. The free market is what made US an economic powerhouse, the free market is good. If it weren't for free markets, my family would probably be in serfdom for some English Baron or Duke.

Unfortunately, our then existing airline industry was thrown to the wolves by a poorly thoughout, politically driven, plan that was more designed to give Ted Kennedy a populist "issue", than it was designed to direct a orderly transition from regulated to deregulated. Kennedy was looking for an issue to attach himself to and gain national publicity in an attempt to position himself for a presidential run. He took the legitimate idea, and made it a political football. Once it looked like he might have something, Senator Cannon (NV), chairman of the Transportation committee, realized that he also needed to get on board in order to preserve his own power. It didn't look good for a junior Senator to be getting all of the press, ya know.


The free market will always supply the best solution if only allowed to work.

regards.
8N

 

[Timebuilder]

>>The result of that was that only a few gigantic companies own most of the country's radio stations - which has killed competition and has really killed radio (Timebuilder, are you out there?).

I'm on the freq.

Being in radio now is a lot like working for a US Air wholly owned as a first officer. You have the feeling that an axe is about to fall, and you get the uncomfortable feeling that it is aimed at your neck.

We won't see the re-regulation of air carriers.

As an aside, even the big radio owners can screw up, big time. Clear Channel paid way too much for most of the stations it bought up. The should have taken a tip from Uncle Mel (Karmazin) and bough on the cheap. Now, CC stock is WAY down. On the other hand, Infinity has risen like a meteor since 1985, and Mel is doing very well.

What is happening with AA and US (and you can name eight more, I'm sure) is a change in the fundamental economics of air service. The system won't support the salaries of the past twenty years. You've read my speech on this already. The sad part is how difficult this paradigm shift will be for the people who work for their money, like you and I.

The long term correction may mean that fewer young people will see the payoff of years of servitude when they evaluate aviation as a career choice, and may make the pilot pool smaller, lowering mimimums again.

The best we can do now is to write our congressmen about flying while fatigued. Remind them of the crash at Little Rock. We might not get the age 60 rule abolished, but we may get another three hours of sleep.