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GUEST COMMENTARY: It’s Time to Reregulate the Airlines

Posted by kinchendavid on July 18, 2006

By Rene A. Henry

Seattle, WA  — Every time Congress decides to deregulate an industry it ends up costing the American taxpayer millions and billions of dollars.  Remember the savings and loan debacle?  Or energy and telephone?  And now, the airlines.

The airlines spent millions of dollars lobbying Congress for deregulation.  Sen. Howard Cannon of Nevada introduced the Airline Deregulation Act which became law on October 28, 1978.  For passengers, shareholders, employees and former employees, the industry has since been in a tailspin.

Under regulation, every effort was made to ensure that no airline ever went out of business.  Congress was concerned following the troubles of the railroads and the bankruptcy of Penn Central that resulted in a massive taxpayer bailout. 

However, since deregulation many airlines today are only memories.  Pan Am.  TWA.  Eastern.  Braniff.  National.  Western.  PSA.  Piedmont.  And, even no frills discounter People Express.  Some 100 smaller airlines have gone bankrupt or been liquidated and investors and lenders have had to write off their losses. 


Complaints increase every year and customer service is almost non-existent with the exception of a few airlines that include Jet Blue, Southwest, Singapore, Virgin Atlantic and Cathay Pacific. 


Airline CEOs must add two words to their vocabulary: customer service.  Under regulation, legislation could require airlines to meet a basic level of customer service in order to get subsidies and approval for changes in routes, prices and airport gates.  I personally would like to see an airline take a step forward today and begin selling service rather than price.  It might find a very profitable niche in the market.

New regulation could insure that residents in smaller markets would receive dependable air service.  Business flyers, which are the revenue core for airlines, would no longer have to subsidize and support the deeply discounted fares of once a year flyers. And, airlines would have to redeem those customer earned miles and points for promised free tickets.  When was the last time you got the flight you wanted?

Legendary comedian Bob Newhart was a visionary when he recorded his 1960s monologue about the Grace L. Ferguson Airline & Storm Door Company.  Most of the time when I’m flying, I believe I’m on that airline!

Since 2001, the industry has lost more than $40 billion and laid off 165,000 employees.  Pension funds for thousands of employees have gone south, impacting the Pension Benefit Guaranty Corp.  Taxpayers will pay to replenish the assets. 


When airlines lose money or barely break even, they don’t have the funds to buy new airplanes.  I am very concerned about an old and aging fleet.  I fly more than I would like to and it is frustrating having to deal not just with delays or cancellations because of mechanical problems, but to sit in a broken seat, or where the light does not work, look down and see duct tape holding parts of the plane together, or where the running water system is broken.  If I see the obvious, what is happening with maintenance outsourced to foreign companies and mechanics who might not be as qualified as those terminated in the U.S.?

On July 11, 2006, KSDK-TV in St. Louis reported that an American Airlines Boeing 757 brought in for maintenance had dead mice in oxygen masks and live mice under seats. The station reported that while safety experts said mice could eat through critical wiring and be a severe safety hazard, the Federal Aviation Administration said American did nothing wrong because airlines do not have to report rodent infestations unless it affects the mechanics. How safe are the planes we are flying in?  Does the “deregulated” FAA need a crash to do its job?

Orders for new planes would be an economic boon for the State of Washington, and other states.  If anyone should be pushing for reregulation, it should be Washington’s Congressional delegation.  However, the state’s representatives have had no presence or political clout in the capitol since Henry “Scoop” Jackson and Warren Magnuson were in the Senate and Tom Foley was the Speaker of the House.  Washington’s representatives in Congress should take a lesson from Senators Robert Byrd (D-West Va.) and Ted Stevens (R-Alaska) and what they have done for their states’ economies.

Deregulation also led airlines to change from point-to-point nonstop service to the hub and spoke system.  Increased flights in-and-out of hub airports put stress on the air traffic control system and already overtaxed and unhappy controllers.  Because of poor management and insufficient funds to modernize outdated computers and radar, experts predict today’s average flight delay will triple by 2014.  Perhaps Congress should begin investing in high speed rail to cities now served by regional jets.

The next time you have a problem, don’t just complain to the airline or the Aviation Consumer Protection Division of the U.S. Department of Transportation.  Write your Senators and U.S. Representative and ask them what they are going to do about it.  Congress can do something.  And if it doesn’t, it will continue to subsidize the major airlines to keep them in business with our taxpayer dollars.

Rene A. Henry is the author of six books and writes and speaks on customer service, marketing public relations and crisis management and communications.  A native of Charleston, WV, he lives in Seattle and has flown more than three million miles.




One Response to “GUEST COMMENTARY: It’s Time to Reregulate the Airlines”

  1. In defense of regulation

    You hear a lot about deregulation. Deregulation of electric utilities, deregulation of telecommunications, deregulation of the airline industry. Although the word may have lost it’s luster for some, with all the companies, industries, and polit…

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