Crandall wants to re-regulate airlines

"We have failed to confront the reality that unfettered competition just doesn't work very well in certain industries,"- Robertt Crandall, Former CEO of American Airlines.

"Unfettered" - To set free or keep free from restrictions or bonds.

People have a right to advocate for government run industries. Just please do not blame an industry's problems on the "unfettered" free market where a free market does not exist.

Sounds like Mr. Crandall is another closet Marxist who has gotten rich from capitalism. Again, even smart people like Crandall claim American industries are free markets. It just ain't so! Who owns the ATC system that allows a small jet to fly empty, use up the same ATC space, and pay the same cost as a jumbo jet full of passengers using the same amount of ATC space? The government owns and operates the airspace, inefficiently.

One way to improve and go to a free market use of the airspace would be to have each user of their block of airspace be charged the rate for the demand at the time of usage. This would make peak times more valuable. The government owns and runs the ATC system, inefficiently, and now Crandall wants more government involvement in air transportation??

If Crandall's Marxist/socialist/fascist plan, or whatever you want to call it happens, it will be good for the bankers, employees, and airline executives, but not for the consumers. There are more of the latter than the former. We are all consumers, or potential consumers in a free market.

Remember before deregulation if you worked for United Airlines there were no promotions because the central planners denied United Airlines new routes. It paid to have connections with members of the transportation committees in congress. Deregulation created thousands of jobs and new services to hundreds of small communities.

Under regulation, Senator Howard Cannon of Nevada made sure the small towns of Nevada, Elko and Ely, were served by United Airlines, with subsidies. These flights from San Francisco never carried enough passengers to pay the cost, but under regulation Howard Cannon forced taxpayers and United Airlines to provide service to small communities that would not support service.

Since deregulation, air travelers have saved billions on ticket costs. Businesses have expanded. The cost and inconvenience of air travel may mean consumers will change their lifestyles and businesses will do more teleconferences and centralizing their activities to avoid travel. The market works, if allowed.

Crandall's plan sounds like a utopian's dream. - "the industry's goal should be to harness competition and regulation to create a system responsive to both the imperative of efficiency and the desirability of decent service" - Now Crandall wants the government to regulate service. Gads! Will the dreamers ever wake up? I'm afraid not.

If we lose all our petroleum and have to give up traveling by modern means and go back to traveling by stagecoach, you can rest assured there will be a FSA, Federal Stagecoach Administration, that licenses stagecoach drivers! OSHA will make sure the stagecoach passengers and employees are safe. The horses will be shod by a blacksmith that must spend two years as an apprentice.-And there will be a Stageway Labor Act to see that the employees have bargaining rights.

Charles Tolleson

Robert Crandall Calls For Re-Regulation Jun 11, 2008

By Anthony L. Velocci, Jr./Aviation Daily (see http://tinyurl.com/4vqgdq for article and comments from readers)

Decrying the "sad state" of U.S. commercial aviation, former American Chairman and CEO Robert Crandall yesterday declared three decades of deregulation a failure and said that treating airlines like a regulated utility must be a part of a broad solution to their current financial crisis."We have failed to confront the reality that unfettered competition just doesn't work very well in certain industries, as aptly demonstrated by our airline experience and by the adverse outcomes associated with various state efforts to deregulate electricity rates," Crandall told aviation and financial industry professionals gathered at the Wings Club in New York City. "It's time to acknowledge that airlines look and are more like utilities than ordinary businesses."While the rapid rise in jet fuel prices has complicated the job of airline managers, fuel prices are not at the core of the industry's precarious financial state. Inadequate scale isn't to blame either, he added."The arguments in favor of consolidation are unpersuasive," he said."Mergers will not lower fuel prices, and they will not increase economies of scale for already sizable major airlines. If consolidation were really the answer, it is conceivable the system could be run by a single efficient operator."Instead, Crandall continued, the industry's goal should be to harness competition and regulation to create a system responsive to both the imperative of efficiency and the desirability of decent service — now unacceptable "by any standard."In addition to re regulation, Crandall called for:• Overhauling price structures to "recapture" full costs and earn the profits needed to sustain the huge investments essential to the industry's future.• Amending the Railway Labor Act to require binding arbitration to encourage both labor and management to adopt more moderate positions than has been true in the past while simultaneously moving all airlines closer to labor-cost parity.• Revising U.S. bankruptcy laws to deprive failed carriers of the right to use lower costs to undercut the fares offered by "their more prudent rivals."• Regulating the number of flights scheduled to what runways,terminals and air traffic control facilities at airports can handle.• Shrinking schedules proportionately to each airline's current frequency share as a way to pressure carriers to use the largest feasible aircraft in each slot.• Imposing more stringent financial standards that new airlines must meet to eliminate or discourage "short-term antics" by start-ups that have destabilized the pricing structure required by a healthy industry.• A more accommodating stance by Washington towards industry collaboration to achieve more intensive asset utilization and more efficient operations. Crandall also noted, however, that industry regulation will be insufficient to rescue the commercial air transportation industry. Also needed is a national transportation plan of U.S. aviation goals,including a comprehensive redesign of the air traffic control system."Unhappily," he added, "such a plan does not exist."