Deregulation of the U.S. Airline Industry

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Deregulation of the U.S. airline industry has resulted in ticket prices dropping by a third, on an inflation-adjusted basis. As a result some 1.6 million people fly on 4,000 aircraft every day. Airlines carried 643 million passengers in 1998, a 25% increase over 1993 and the FAA estimates that the nation¡¦s airline system will have to accommodate 917 million passengers by the year 2008. The growth in air travel threatens to overwhelm the presently inadequate air traffic control system, which has not kept pace with available technology in navigation, communications, and flight surveillance. Much of the equipment used for air traffic control today is based on fifty-year-old technology; for example, analog simplex voice links for communications and ground-based radar for surveillance, and VHF Omnidirectional Range/Distance Measuring Equipment (VOR/DME) for navigation. The lack of system automation imposes heavy workloads on human air traffic controllers and increases the risk of accidents in heavy traffic situations. Capacity limits are being reached in both airports and airspace, with congestion delays in departure and arrival schedules reaching record numbers. Funds to upgrade the air traffic control system are available in the trust fund created to receive the tax applied to airline passenger tickets and the tax on fuel for general aviation. The General Accounting Office says modernizing the air traffic control system will cost at least 17 billion for just the first 5 years of the FAA¡¦s 15-year National Airspace System improvement plan. It is the NAS that provides the services and infrastructure for air transportation. Air transportation represents 6% of the Nation¡¦s gross domestic product, so the NAS is a critical element of our national economy. Given the size of the NAS, the task ahead is enormous. Our NAS includes more than 18,300 airports, 21 air route traffic control centers, over 460 air traffic control towers and 75 flight service stations, and approximately 4,500 air navigation facilities. The NAS spans the country, extends into the oceans, and interfaces with neighboring air traffic control systems for international flights. The NAS relies on approximately 30,000 FAA employees to provide air traffic control, flight service, security, and field maintenance services. More than 616,000... ... middle of paper ... ...ement, and subject to a conflict of interest between safety regulation and ATC operations. They believe the United States should follow the example of Britain, Germany, Switzerland and most recently, Canada, in fundamentally restructuring air traffic control. It is their opinion that a not-for-profit user-controlled, user-funded corporation is the best way to address the ATC system¡¦s fundamental problems. We find ourselves with a system that currently runs on obsolete and failure-prone equipment such as 1960s mainframe computers, equipment dependent on vacuum tubes, and radar between twenty and thirty years old. The FAA maintains safety margins by artificially increasing the spacing between flights, imposing ground holds and using other techniques that reduce system capacity. The airlines alone waste $3 billion a year in fuel and crew time due to the delays. Wasted passenger time is estimated at several billion dollars more. The FAA¡¦s National Airspace System Architecture Version 4.0 looks very impressive on paper, but given their track record in regards to modernization, maybe we should be looking at alternatives to a thinly stretched bureaucracy.

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