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April 19, 2012 11:58 AM Terminal Sickness: A Washington Monthly/New America Foundation Discussion

By Ed Kilgore

Those who read the March/April issue of the Washington Monthly probably recall the controversial article by Phil Longman and Lina Khan about the continuing failure of America’s experiment with airline deregulation. To put it briefly, they argue the new non-system is responsible for poorer service on fewer routes, without the promised bonanza of lower fares, and is also wreaking major damage on cities that have invested in major hub facilities made obsolescent by airline mergers.

The Monthly and the New America Foundation are cosponsoring a lively discussion of this article and the broader issues surrounding the airline industry on Tuesday, April 24, from 9:30-11:15, at New America’s offices in Washington. For event details and RSVP procedures, click here.

Panelists at the event will include co-author Longman; former congressman (and former chairman of the House Transportation and Infrastructure Committee) James Oberstar; former Northwest Airlines CEO Douglas Steenland; and Tom Jones of Memphis magazine. The Monthly’s Paul Glastris will moderate.

If you live or work in Washington, plan to drop by. And if you’re flying in for this or any other event, gird up your loins for the usual inconveniences of the American way of traveling.

Ed Kilgore is a contributing writer to the Washington Monthly. He is managing editor for The Democratic Strategist and a senior fellow at the Progressive Policy Institute. Find him on Twitter: @ed_kilgore.

Comments

  • Ron Byers on April 19, 2012 12:17 PM:

    For those of you who have never worked with Phil Longman, he is worth the price of the ticket. I wish I could attend.

  • Andrew J. Lazarus on April 19, 2012 1:41 PM:

    It's hard to imagine a more literally 'socialistic' economy than airlines pre-deregulation. For the benefit of the youngsters out there, Southwest Airlines was limited to three airports in Texas. You couldn't fly interstate without Uncle Sam's approval, and, to protect the entrenched airlines, there was no price competition whatsoever. Fares on popular routes are, accounting for inflation, less than half what they were in the regulated period. (See below.)

    Airlines are an easy-to-enter field (also, it's true, easy to exit). Higher fares for out of the way cities are a result of the free market in action. If we're going to subsidize flyover country, let's do it in some transparent way (calling it Rural Welfare so the Tea Party gets the hint that they're on the dole), not hiding it in outrageous fares for New York to LA flights to cross-subsidize half-empty planes. Few if any of the usual reasons for government regulation (e.g., natural monopoly, severe externalities) hold true here, except that some people don't like the free market outcome.

    Most of the alleged advantages of airline regulation could also be applied to the restaurant industry, which has an even higher rate of failure. If the government decreed where restaurants could be and set the menu prices, sure, we could have consistency. Restaurants might compete solely on the quality of their food, since McDonalds and other cost-cutters would be restricted to serving only residents of the nearest three blocks. They would be pretty much guaranteed to be financially successful in their local monopoly.

    As I said before, I'm fairly certain the Monthly was strongly in favor of deregulation when it happened. Right the first time.

    [Note on fares: you can find several historical American Airlines timetables online. The fare in 1967 from NY to LA in 1967 was $145.10 one way. That's $977 in 2012 dollars. Coach. One-way. Tell me again that fares haven't gone down.]

  • jjm on April 19, 2012 2:14 PM:

    The main complaint I have is that, to save money, they are consolidating flights to the point where each flight is more than jam-packed with coach travelers. You can hardly breathe or move, when the seats are so close that when the person in front leans their chair back the angle for being able to rise from you own is more than super acute.

    On a recent trip to lecture in Europe, in March, not high tourist season, on Delta, which is in a consortium with Air France and KLM canceled our flight on the morning before, rebooking us on Air France. Then Air France canceled our flight and re-booked us on KLM, but not before we were notified simply that the flight was "CANCELED". Similar experience on the return.

    Oh, and because they flipped our plane so many times, they 'lost' the special meal request (due to allergy).

    When first class goes for tens of thousands of dollars, and business class is five times, a least what the coach seat goes for, I wonder why airlines are 'losing money' and why they are so sadistic about crowding those of us who are in what is very like steerage.

  • Bonnie on April 19, 2012 7:37 PM:

    Since I have retired, I have vowed NEVER to fly again. Security and the bad service are the reasons. If I go anywhere, I will take the train; but, don't plan to go anywhere beyond 150 miles from home. Can drive that distance, too.