Time for re-regulation

[cezzna]

I never though I would say this, but I seriously think the only thing that will save the airline industry is to re-regulate it. I'm no fan of big government and I'm sure they would screw a lot of it up, but what else can be done? I think the airlines have proven since 1978 that they can't get it right. The free market just isn't working for this industry. Lives are being ruined, everyone is bankrupt year after year, the pensions are gone. This industry needs some stability. The only way to make these airlines charge what they should be charging is to make them do it.

 

[The_Russian]

I hope the new "responsible managment rules" that start in October help out our situation.

 

[ToiletDuck]

I hope the new "responsible managment rules" that start in October help out our situation.

What are these rules? Can you post a link to read on them more?

I did some searching but all i've found related was this.

http://www.cato.org/pubs/regulation/regv15n3/reg15n3-bailey.html

 

[FN FAL]

As your presidential candidate on the Reform Party Ticket...

I promise to re-regulate the Airlines and all their industries and labor...

I promise to ensure that all workers earn 55,000 a year untill the day they die or stop working, whichever comes first...

I promise to make your job safer for you and your passengers, by legislating and requiring automation by 2015...

There will be no layoffs under my new re-organization plan, I will structure the new airlines under the Federal Transportation System and under such system, even empty airliners will be able to fly their routes. Taxation of the citizens will cover the bill once all airline employees become FTS workers...

 

[FurloughedAgain]

I tend to agree with at least partial regulation.

At the very LEAST waive the aviation fuel tax. By the end of the week we may have 4 major airlines operating under bankruptcy protection. By the end of the month it may be joined by at least one more (Indy).

Southwest CEO says that without their fuel hedges even THEY can not make money with energy prices this high.

Our economy is dependant upon the airlines for better or for worse.

Any business model wherein multiple players rely on bankruptcy protection to operate is obviously unsustainable.

 

[Tarzan]

Since when has the government done anything right? Isn't there a chance that the reason why we have the problem we have today is because of regulation for so many years?

Old habits die hard, but as soon as Uncle Sam lets one of these bloated companies go down the drain, I'll bet things straighten up pretty quick. Fed Ex and UPS manage to pay their guys well. Southwest does great. Why shouldn't the rest learn and deal with it?

We don't need the government to step in when this thing is getting closer to being fixed. I don't need to pay my taxes so somebodies son can get a huge check because he saved $100000 but will cost the company millions later.

 

[Workin'Stiff]

Tired-

Thats great that those companies are very fortunate in their current business practices. However, even comparing Southwest to any of the legacy carriers is like comparing apples to oranges. Southwest has always concentrated on keeping fares low and providing service within the US. The legacy carriers have expanded their reach to surround the globe and provided several levels of service such as coach, first, and business classes. That type of operation is vastly different than Southwest. So it is truely unfair to compare the two based on the fact they have night and day business models.

 

[Wasted]

The partial deregulation of the industry has certainly made the sustainment of the airline industry questionable. It has allowed some companies to cherry pick while disallowing true competition. Partial deregulation is the worst possible situation for the airlines, as it allows neither the benefits of complete regulation nor complete deregulation. In the end the consumer is who truely won, as I suppose the intent of the derugulation was. Unfortunately, this comes at the expense of all those who work in the industry who have given into the pockets of consumers their wages and retirements. But more than anybody else, the one group who has done more to prop up failing airlines and have kept this industry from any possibility of regaining some sort of health are the financiers such as GE Capital who continually bail the bankrupt companies out and prolong life from what should have been inevitable demises.

 

[PaulThomas]

We don't need the government. We need responsible CEO. If a company can't make money because they don't charge enough, share holders should do something about it through the board of chairmen.

And for the private companie, if it's owner want to trash his company it is his right to do so.

Remember that you have the right to not sign a contract that you don't like, but many are under the SJS and will do anything.

 

[FN FAL]

Remember that you have the right to not sign a contract that you don't like, but many are under the SJS and will do anything.

As your president, I will appoint a Ministry of Syndromes. The Ministry will ensure that there are no Shiny Jets...which should end SJS, once and for all.

 

[soarby007]

Oh YEAH, get big brother to solve all our problems, protect us from disasters, and above all SAVE the airlines. Let the free market work and if four of the big ones, go, oh well.

Get the government involved any more than they are in the aviation business and it will be a genuine Aeroflop.

I agree with PaulThomas, get some responsible CEO's and unions. Greed will ruin a good thing anytime.

 

[Flying Illini]

Branson should buy these ailing airlines and completely restructure the system. He wouldn't hesitate to raise prices so that all airline expenses are covered as well as having a little left over...something called "profit."

 

[ToiletDuck]

Since when has the government done anything right? Isn't there a chance that the reason why we have the problem we have today is because of regulation for so many years?

No... Under regulation the airlines were more closely monitored. After deregulation anyone with enough cash to get a couple airplanes hopped in and starting doing it all wrong. Didn't know what to charge ect. So the big guys had to drop their prices to match. I read on yahoo news of all places that airlines were only able to charge a cheaper price than some commuter in California area because they were operating under bankruptcy. Of course my opinion was greatly formed by professors and such since I wasn't around when it happened, but from what they've always barked re-regulation would be a great thing. Also that as much as it might hurt having an airline or two go bankrupt would help(meaning smaller commuters). A general hike across the board in fares would be a good thing. I might not want to pay it but it would be the best for the economy in the long run. It's the new companies that get a loan, hop in for a couple years charging stupid prices, then after losing money each year they go bankrupt that keep hurting it. Ex:Whoever the company was that tried to charge the same amount for nothing but business/firstclass seats in the whole plane... crap like that. Regulation of who can enter the business is a great thing. As far as the govn't goes I think Aviation is one place they never jacked around and did a great job.

 

[ToiletDuck]

Oh YEAH, get big brother to solve all our problems, protect us from disasters, and above all SAVE the airlines. Let the free market work and if four of the big ones, go, oh well.

Get the government involved any more than they are in the aviation business and it will be a genuine Aeroflop.

I agree with PaulThomas, get some responsible CEO's and unions. Greed will ruin a good thing anytime.

Hence why regulation worked. The problem wasn't till after deregulation. So why complain about a working system. They thought they could do it better and they couldn't. Give "Big Brother" some credit.

 

[JD2003]

Just a few observations:

The airlines essentially are still regulated. This is to say that the only part of the airlines not regulated are the economics. i.e. the civil aeronatics board c. 1978 and prior, no longer has a say in what airlines will charge and where they can fly.

Because of economic deregulation you can argue that the industry exists in a state of destructive competition; hence the need for economic regulation.

 

[Icelandair]

The government tells gas stations they can't sell gas for less than cost. So the fat cat station owners gouge us and pass on the cost and sell gas at an exorbanant rate.

So why can't the government come in and set up minimum pricing that is sustainable for all?

 

[pilotyip]

Yea let us go back to the regulated industry like 1975, 75% less pilots flying, most guys hired by the majors are ex-military like about 85%. The regional industry, SWA outside of Texas, Air Tran, Spirit, do not exist. This means 3 out of 4 pilots presently would probably not have jobs. Is this what we really want?

 

[labbats]

The government tells gas stations they can't sell gas for less than cost. So the fat cat station owners gouge us and pass on the cost and sell gas at an exorbanant rate.

So why can't the government come in and set up minimum pricing that is sustainable for all?

This is what I've been saying all along. You have state mandated minimum pricing for fuel/cigarretes/etc, this would only make sense to fix the airlines too.

 

[cynic]

In a nutshell...

With deregulation you will have greater instability, faster growth and more innovation.

With regulation (only one carrier can fly Miami to NY and you also have to fly to these small cities if you fly that route) you get stability, slower growth and innovation is stifled.


So if you believe that like electricity and sewer service; Transportation is so vitally important we can’t afford the big down cycles that come with deregulation then you should agree that the industry should be regulated. The government would control who flies which routes and how much they can charge.


What we have now is a totally dysfunctional system that stifles growth and innovation while promoting instability. How can Jet Blue compete with other major carriers, flying routes at a loss because the federal government keeps bailing them out.


What we REALLY want is for the government to step fully in and regulate the industry or get the heck out and let American, Delta and United tank.

 

[ToiletDuck]

De-regulation=Inflation within industry

Yea let us go back to the regulated industry like 1975, 75% less pilots flying, most guys hired by the majors are ex-military like about 85%. The regional industry, SWA outside of Texas, Air Tran, Spirit, do not exist. This means 3 out of 4 pilots presently would probably not have jobs. Is this what we really want?

Less pilots because of less travel. Yes there would most likely be a decline in pilots. However this is a better alternative to having the entire industry crash. Sometimes what we want isn't what's actually best for the industry as a whole. If a couple airlines went out of business this would be better for the aviation industry as a whole. While harder to get/find jobs for us. The industry would survive.

During the time of regulation civil aviation was still developing. With the new limits of aircraft today it is reasonable to ask that regulation come back in the sense that it could keep smaller businesses from trying to start up. I think in the airline industry a monopoly isn't such a bad thing.