Editore"s Note
Tilting at Windmills

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July 23, 2008
By: Kevin Drum

BUSINESS TRAVEL....In recent decades, the cost of air travel has decreased and so has the service. MattY sees dark forces at work:

But what's missing from this analysis is the executive suite. This is where folks have been able to give their employees a de facto pay cut in terms of subjecting them to cheaper, lower-quality air travel and plow the profits thereby gained into corporate jets and first class tickets. A sweet deal for them, indeed. In other words, business travelers of the world unite, you have nothing to lose but your missed connections!

I'm totally on board with populist CEO bashing, but I'm pretty sure this isn't right. Compared to, say, 30 years ago, travel is indeed a lot cheaper, but the result isn't increased corporate profits, it's more business travel: the white collar wage slaves of 2008 suffer through way more business trips than their fathers did in 1978. That's a bummer, but it's a slightly different bummer than Matt suggests.

NOTE: No, I don't have any figures to back this up. Life's too short. But if anyone wants to point toward some, comments are open.

Kevin Drum 1:45 PM Permalink | Trackbacks | Comments (24)

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Comments

Do business trips really stink that much? I thought getting to go somewhere would be fun.

You may be on a plane, but you have to sit still and do things like read or watch a DVD at some point anyway, right?

Posted by: Swan on July 23, 2008 at 1:51 PM | PERMALINK

Oh, I know-- you and Matt must fly on the airlines where they don't give adults the pilotwings and the little toy planes.

That's what's bothering you.

Posted by: Swan on July 23, 2008 at 1:53 PM | PERMALINK

Obviously Swan hasn't been employed for some time.

But MattY is being rather specious here. It is a bit far fetched to suggest that upper management purposely planned airline deregulation so as to boost corporate profits. I'm wondering if MattY is wearing a tin foil cape that matches his hat today.

Posted by: optical weenie on July 23, 2008 at 1:57 PM | PERMALINK

In 2006 the Dupage County (IL) Airport bragged they had almost as many takeoff and landings in the previous year as Midway Airport in Chicago. Midway serves a ton of commercial traffic and the IL Nat'l Air Guard. DuPage serves nothing but corporate jets. In the next few years the FAA is going install a huge new expensive nat'l. radar system because of all the add'l. air traffic. The next time you're sitting on the tarmac or orbiting the airport waiting to land think of those titans of industry who butt in line and fly in and out of our airspace in corporate jets at their beck and call with no wait whatsoever from these kind of regional airports.

What's particularly galling is DuPage County taxpayers have been funding the Republican boondoggle airport and it's adjacent golf course and mostly empty office park to the tune of $6.5 million a year for over a decade.

Posted by: markg8 on July 23, 2008 at 2:04 PM | PERMALINK

It's easy to prove that airlines fees are far cheaper than they used to be, for sure.

As for the increase in business flights, when I was a real low level nobody (as opposed to the real middle level nobody I am now), I was sent on plane trips all the time. I am in the tech business, and if my betters wanted me to ... I dunno .. go to meetings in person with other people of my level ... they wouldn't think twice of just putting me on a plane for a cross-country flight. I was never sure why teleconferencing or, you know, email wouldn't work just as well, but there you go. I practically lived on a plane those days. And I made crap in salary and I was a big big big nobody.

Posted by: BombIranForChrist on July 23, 2008 at 2:05 PM | PERMALINK

"cost of air travel has decreased" - you obviously haven't booked any flights recently - as in the past 2 or 3 months. Expedia often doesn't even show you the price directly - you have click to see them - must be some kind of heart attack prevention scheme.

Posted by: RobertSeattle on July 23, 2008 at 2:07 PM | PERMALINK

Oh, Swan is gainfully employed, Dr. Weenie.

But cutting out paper dolls with dull-edge scissors is not an occupation that requires a lot of travel.

Posted by: nurse ratched on July 23, 2008 at 2:17 PM | PERMALINK

Like a lot of pieces of late-20th century life, casual air travel won't make sense in the upcoming era of more expensive energy. Assuming there is an actual need to move people around so much, it'll cost more, though I should think businesses will have to put some thought into when travel is really necessary. I suspect they'll find teleconferencing and email can accomplish a lot of what they used to think required travel.

As air travel reverts back to being an elite-only phenomenon, we'll need some other alternatives than intercity buses or individual driving. I nominate high-speed rail.

Posted by: jimBOB on July 23, 2008 at 2:21 PM | PERMALINK

Well, I don't have any figures either, Kevin, but I do recall hearing that business travel was down after 9/11 and that it was down again due to costs/bad economy.

But the overall trend may indeed be up.
.

Posted by: Grand Moff Texan on July 23, 2008 at 2:22 PM | PERMALINK

Just to reaffirm something I said in the post, I'm talking about the post-deregulation world of the past couple of decades. That is, long-term trends. In the medium term, nothing much has changed at all, and in the short term prices have gone up. Those are different issues.

Posted by: Kevin Drum on July 23, 2008 at 2:27 PM | PERMALINK

Obviously Swan hasn't been employed for some time.

Chill out, Beta-O. Such language doesn't suit you. Go back to languidly sweeping the kitchen and peeling potatoes.

Posted by: Swan on July 23, 2008 at 2:27 PM | PERMALINK

Go back to languidly sweeping the kitchen and peeling potatoes.

Weenie, you sweep Swan's kitchen? While I'm over here cleaning your bathtub with a toothbrush? There is no justice in this world.

Posted by: thersites on July 23, 2008 at 2:37 PM | PERMALINK

Go back to languidly sweeping the kitchen and peeling potatoes. - Swan

Only if I can wear my gas tax holiday shoes, Swan. I refuse to go barefoot in the kitchen, it causes pregnancy you know.

Posted by: optical weenie on July 23, 2008 at 2:44 PM | PERMALINK

Swan,

You know that Dr. Weenie is on staff here. Only patients have to take a turn on kitchen duty.

Posted by: nurse ratched on July 23, 2008 at 2:55 PM | PERMALINK

I for one am grateful for the opportunity to get training. I was able to become an expert in my field because it was cheap enough for my employer to send me to the manufacturer's training schools. Fortunately, for quite a while, there were round trip flights from Phoenix to LA for $60. This made the cost of travel a negligible expense.
Getting to the airport, parking, and going through the check-in process was much more time-consuming and painful than the flight itself. The cost of air travel is not based on how far you go, but what points you go between.

Posted by: gaston44 on July 23, 2008 at 3:17 PM | PERMALINK

I've been a fan of true high-speed rail- not the mid-speed Acela which Amtrak calls high speed- for a long time. There are, however, two main problems w/HSR in the US:

1) The reason I refer to Acela as mid-speed is that, well, it is only middling-fast when compared to systems overseas. Where Acela's average speed is 86 MPH, Japan's Shinkansen trains average more than 125 mph, Frances TGV trains average 173 mph, Germanys ICE averages 153 mph, and South Koreas averages 125 mph. [thanks, Wikipedia]. The reason for this is similar to the reason we have slower broadband that most other comparable countries, as well as only moving to 'HD' TV decades after them: our systems are older. I read once that the only reason that Amtrak can run the Acela at close to its rated max of 125 MPH on the northeast corridor is that the Pennsylvania Railroad did a major system upgrade- IN THE 1930s. Much of our rail system is similarly old, and can't take the abuse which a true high-speed system would dish out.

2) Look at the countries I listed above, + think what they have in common: every one is *much* smaller than the US. The sheer size of the US causes problems for rail as a transit option. Now, Boston to Washington on HSR makes plenty of sense- on such a run, rail probably takes less time than air, when you take the security checkpoints, etc., of air travel into account. But New York to LA via train? Even HSR can't make that as fast as flying.

On the NEC, HSR blows away all other modes of transit. Outside of there, its advantages decrease rather quickly. And I say this as a *major* railfan.

-Z

Posted by: Zorro on July 23, 2008 at 3:25 PM | PERMALINK

But MattY is being rather specious here.

Nope. Just being know-nothing Matt.

It is a bit far fetched to suggest that upper management purposely planned airline deregulation so as to boost corporate profits.Posted by: optical weenie

As I recall, the airlines were rather skeptical about deregulation as they knew it would open up competition, which was fine to a point when fuel was cheaper and before the 9/11 attacks. But as flying became nearly as cheap as taking the train or bus (and much faster for long hauls), service has diminished to the point of being almost non-existent. The fact of the matter is too many people fly for the capacity of the airports and air traffic control (calling Ronnie Reagan).

"cost of air travel has decreased" - you obviously haven't booked any flights recently - as in the past 2 or 3 months. Posted by: RobertSeattle

Robert is perhaps the same age as young and blindingly inexperienced Matt? I guess your experience with flying goes back all of five to six years? Yes. Ticket prices have climbed in the last few months. But if you compare what it cost fifteen years ago, flying is still pretty cheap, and many times cheaper than it was thirty years ago.

The reason for this is similar to the reason we have slower broadband that most other comparable countries, as well as only moving to 'HD' TV decades after them: our systems are older. Posted by: Zorro

Where do you get this nonsense? I was living in Japan in the mid-1990s when the first HDTVs were available. It's hardly ubiquitous there even today.

Ditto with everyone having broader bandwidth. The U.S. is in the top five in the world, and is head and shoulders above any nation even half as physically large.

Posted by: Jeff II on July 23, 2008 at 3:42 PM | PERMALINK

On the NEC, HSR blows away all other modes of transit. Outside of there, its advantages decrease rather quickly. And I say this as a *major* railfan.

Actually, there are other areas in the US and Canada where it's probably equally economical in terms of distance between major cities, including the Midwest (Chicago-Detroit-Toronto-Cleveland-Columbus--Cincinnati area), California (San Francisco-LA-San-Diego), and the Pacific Northwest (Vancouver-Seattle-Portland), etc.

Posted by: Stefan on July 23, 2008 at 3:47 PM | PERMALINK

Actually, there are other areas in the US and Canada where it's probably equally economical in terms of distance between major cities, . . . , and the Pacific Northwest (Vancouver-Seattle-Portland), etc. Posted by: Stefan

Given what it costs in time, it's now actually more convenient to drive than to fly between Seattle and Portland (approx. three hours) and Seattle and Vancouver (approx. two hours).

A high speed rail line linking Portland, Seattle and Vancouver would be great as long as the stations were all in the heart of the cities. The biggest obstacle to ever realizing this is the absence of a dedicated right of way. Then there's that pesky border thing.

Posted by: Jeff II on July 23, 2008 at 4:03 PM | PERMALINK

as well as only moving to 'HD' TV decades after them

Huh? The US is scheduled to complete the transition to only-digital broadcasting in Feb 2009. The UK won't get to that till 2012, and Canada, France and Japan 2011. Mexico isn't scheduled to fully transition till 2022. A few countries (Netherlands, Sweden) are already done, but only withing the past couple of years.

On the NEC, HSR blows away all other modes of transit. Outside of there, its advantages decrease rather quickly.

As oil prices rise and air travel gets pricier, rail will start looking a lot better in more and more locations. Not to mention it skips a great deal of the security theater nonsense the airlines are saddled with.

Posted by: on July 23, 2008 at 5:22 PM | PERMALINK

Oops, the 5:22 was me.

Posted by: jimBOB on July 23, 2008 at 5:40 PM | PERMALINK

Absolutely correct on the switchover to digital, jimBOB, and even that doesn't mean a switchover to full HD immediately in Europe, though we have had had a higher standard of broadcasting than the US for some 40 years - 625 vs 525 lines, which does make a difference.

As for rail, the thing to emulate in the US in the long term may not be TGV style technology but maglev trains - as demonstrated here - www.ultraspeed.co.uk

Posted by: Nick Wright on July 23, 2008 at 6:17 PM | PERMALINK

In recent decades, the cost of air travel has decreased and so has the service.

I've got nothing but personal anecdotes, only peripherally relevant, but for what it's worth, when I'm traveling on business I'm much less productive in the airport or on a plane (than I am at home or in my office). It's not a total loss, of course, but it's a hit. What this means for me is that the decrease in ticket price isn't always reflective of a reduction in cost for traveling. Some short flights between my southern town and DC, for example, used to take less than three hours from the time I got to my local airport to the time I left DCA. Now with security, flight delays, and so forth, the last two times I did the trip it was pushing six hours. Now, I'm not paid by the hour, when traveling or not, but for me the personal cost of traveling hasn't really gone down with lower prices.

Posted by: RSA on July 23, 2008 at 10:08 PM | PERMALINK

Sorry Kevin, your post popped into my RSS Feeder right as I was trying to book flights to Kauai for four - I felt like I was in the middle of a mugging... It's the cost of a fill-up time 100.

Posted by: RobertSeattle on July 24, 2008 at 11:06 AM | PERMALINK




 

 

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