Tuesday, December 14, 2010

FAAC Recommendations Coming

The Future of Aviation Advisory Committee, a special task force created last April to advise U.S. Transportation Secretary Ray LaHood on challenges facing the air transport industry, is scheduled to issue its recommendations tomorrow afternoon.  See Press Release, U.S. Dep't of Transp., Future of Aviation Advisory Committee to Hold Final Meeting Dec. 15 (Dec. 13, 2010) (available here).  Further information on the FAAC, including a full description of its mandate, is available here.

One area the FAAC is charged to examine is "balancing the [airline] industry's competitiveness and viability."  The unfortunate implication of this phrasing is that "competition" and "viability" are mutually exclusive ends.  This is false.  A competitive marketplace is both good for consumers and the airlines, but only if authorities in Washington wield their regulatory control sparingly.  Attempting to create an artificially "competitive" market by blocking mergers yields waste and undercuts sustainability.  Moreover, "viability" is difficult to achieve at the international level when U.S. airlines are barred by ownership and control rules from accessing global capital markets.  Tack on regulations covering everything from passenger rights to advertising and what you have is an excessively costly operating environment for U.S. carriers.


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