America’s unfriendly skies
Favors go to private and corporate jet owners over the legitimate interests of other aviators
Liberals love to portray the Republicans as the party of the rich and powerful. The GOP has tried valiantly to shed that criticism, but then why are so many in the party defending the special interest favors that go to private and corporate jet owners over the interests of all the rest of us? Do Warren Buffett and LeBron James really need a taxpayer subsidy to jet across the country?
At issue here is the proposed modernization of the operations and pricing of America’s air traffic control system. President Trump has proposed an ATC upgrade that would take the system out of the direct control of the government bureaucracy and convert it into a self-funded, nonprofit group. The air traffic control system would become directly accountable to the industry and passengers — not politicians, five congressional committees, and the government bureaucracy. The Clinton administration proposed something very much like this 20 years ago.
This would upgrade an air traffic control system that still operates as it did when “The Brady Bunch” was still the hit TV show. The Federal Aviation Administration continues to spend billions of dollars to try to bring the infrastructure and management into the 21st century (a program called NextGen) with little to show for it. Amazingly, many air traffic controllers still don’t have the capacity to see the air space beyond their radar screen. It’s like they are working with Atari computers.
This inefficiency makes air travel more expensive for everyone who flies. Transportation expert Bob Poole of the Reason Foundation finds that “the cost per controlled flight hour in domestic airspace is $335 in Canada, but $453 in the United States, a 35 percent difference.” Canada has gone private as have many other nations, including the U.K. and Germany.
Meanwhile, we burn through an estimated $30 billion a year in lost man hours, wasted fuel, and lost productivity due to flight delays. Many of these delays are due to weather, but thousands of flight delays and cancellations are not due to acts of God, but manmade disasters. The air traffic control system is just too antiquated, bureaucratic and expensive to cope with the volume of flights — with some 7,000 planes in the air at any given time.
The best solution would be to move to a for-profit air traffic control system, where the operators have a financial incentive to make things run smoothly. Nothing generates efficiency improvements faster than the profit motive. But this is seen as too radical, so the compromise is a nonprofit entity with a board of directors made up of all the stakeholders in the system — including the airlines, airports, and passenger groups. That is the plan that the White House and House Transportation Committee chairman Bill Shuster are pushing. But many in Congress are showing signs of motion sickness and are resisting the change. They are buckling under to a deeppocketed group called the National Business Aviation Association (NBAA) that is spending millions of dollars to defeat modernization.
NBAA is a lobbying group that represents corporate and private jet owners. It’s board is made up of many Fortune 100 companies. I don’t have anything against private jets. I wish that someday I could afford one. They are a wonderful way to fly if you ever get the chance.
But private jet owners have a sweet deal thanks to Washington. A new analysis by Bloomberg found that a “private jet could generate as little as two percent of the taxes and fees paid by airline passengers on an identical route.” All told, private jets use about $1 billion of ATC resources but contribute only about one-tenth that amount to cover those costs.
Private jets are exempt from the ticket tax and the $4.10 per passenger tax paid by those of us who aren’t multi-millionaires and have to squeeze on to a Southwest flight. But the air traffic control system costs the same whether a plane has 3 corporate execs or a jumbo jet with 300 passengers. These tax breaks mean that the poor subsidize the rich to the tune of hundreds of millions of dollars a year.
Fix this, and the cost of flying for the rest of us goes down. A modernized air traffic control system would eliminate many, if not all of, the airline ticket taxes, and move toward a genuine user fee structure for use of the air space — something that will probably never happen as long as lobbyists are setting the pricing structure.
In the days ahead Congress will vote on a private system so the efficiency, number of delays, and high operating costs go down. Many liberal Republicans and Democrats may vote with the corporate interests and keep Congress in control. This gives more clout to the politicians and retains the tax preferences for the millionaires. Keep that in mind the next time a liberal professes to care about the “little guy.”
The air traffic control system is just too antiquated, bureaucratic and expensive to cope with the volume of flights — with some 7,000 planes in the air at any given time.
Stephen Moore is a senior fellow at the Heritage Foundation and an economic consultant with Freedom Works. He served as a senior economic advisor to the Trump campaign.