Strike The Root Blog

Back in August, New York Gov. Eliot Spitzer—perhaps the most aptly named politician of my lifetime—had, through sheer force of his and the New York state legislature’s will, “guaranteed” certain “rights” for consumers of air travel. That law officially went into effect as of Jan. 1^st.

This “Passenger’s Bill of Rights” mandates that “passengers in New York who are delayed on planes for more than three hours will not be without basic amenities including: water, snacks, fresh air and working restrooms. And if they feel their rights are violated, they can report it and airlines could face penalties of up to $100,000 per passenger per violation.” The new law also creates costly new roles for government bureaucrats, i.e., a New York-based “consumer advocate” charged with coordinating communication between airline officials, Federal agencies and the Port Authority of New York and New Jersey in the event of serious delays.

Leaving aside the rather perverse interpretation of “rights” implicit in this legislative monstrosity, the underlying assumption here is that airlines are somehow responsible for the delays in question. The fact of the matter, however, is that airway and runway traffic, and thus the airport congestion that causes delays, is not within the realm of their control. Airways and airports are managed by government, not commercial airlines. No airline can regulate the allocation or usage of air routes, airports and their runways. Those functions have been monopolized by government, which frequently results in all sorts of misallocations of runway space and gross inefficiencies—such as flight delays—while many profit-seeking airlines have largely succeeded in making air travel more efficient and thus more affordable, thus stimulating increased use of their services. The answer is not new government laws, but the abolition of government control over air travel.

Perhaps it’s not so remarkable, but New York politicians aren’t even pretending to address the actual causes of the delays. It appears that in their view, any delay in itself is not really the problem; it’s that airline consumers don’t have enough water and peanuts while wasting their scarce time on the tarmac waiting for the government-induced airport congestion to clear up just enough to allow a take-off. It shouldn’t be any surprise that state bureaucrats will always do everything they can to deflect attention to practically anything but the massive deficiencies of their own clumsy and costly monopoly.

Prediction: The biggest and most politically entrenched corporate airline behemoths will be able to absorb the additional costs imposed by Spitzer’s Law, while relatively smaller airlines that have consistently been on the vanguard of innovation in commercial air travel will not. The result will be less competition and fewer choices, and that inevitably means higher prices than before for air travelers from, going to or merely passing through New York.

This effectively amounts to an even bigger subsidy for private corporate jets than they’ve already enjoyed, as they would most likely be outcompeted in bids for scarce runway “slots” by commercial airlines if those slots were allocated by the rational pricing system of a competitive market. The current statist system effectively suppresses the price of runway usage, which naturally leads to overusage of those runways and is why the FAA imposes strict quotas on how many operations per hour airlines can have at the major airports. Hence the congestion and delays.

Another prediction: As recently demanded by many New York lawmakers and even by some in the airline industry itself, the US Congress will eventually pass a Federal “Passenger Bill of Rights,” so that every airline operating out of every airport in the country will have to obey the same costly regulatory standards, which may be the first half-step toward effectively re-cartelizing the airline industry nearly 30 years after the elimination of the Civil Aeronautics Board. This all pretty much follows the standard government-caused problem/public outcry/government-created solution paradigm to a “T.”

In the long run, many passengers’ rights will be violated, not protected, and it will be the fattest cats who will benefit accordingly.

This entry was posted on Wednesday, January 2nd, 2008 at 7:57 pm and is filed under Uncategorized, bureaucracy, laws, regulations, politicians, statism, Yourmerica, economics. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.