Are airlines really unregulated?

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The fact of the matter is that airlines are only partially deregulated. They are not too different from the giant electric utilities that use massive grids to distribute power.

There is a regulated portion of the system that is the airport infrastructure and the airtraffic control system. This traffic grid is controlled by the FAA, the military and municipalities.

Airlines are the energy that moves through this air traffic grid. The airlines are unregulated, but their movement is limited by the size and modernization of the government-controlled grid.

The private portion of the air transportation network, has dramatically improved over the past 30 years. Aircraft have become larger and more efficient, computer systems allow for management of complex airlines, jet engines are more powerful and reliable, materials are stronger and lighter and, though passengers will always complain, the overall travel network has improved with more aircraft and more flights serving more cities and towns and countries more frequently than ever before.

The government-controlled side of the transportation network has not seen the same kinds of improvements. Our air traffic control system is still mired in post-WWII infrastructure with old technology radars. Congress does not seem capable of moving forward with improvements even when everyone from the Senate to the House and from the DOT and DOD agree on its importance. Airport and runway construction has ground to a halt mired in bureaucratic warfare.

Although deregulation affected the flows of air travel (the private side), the infrastructure grid (the government-controlled part) remains subject to government control and economic distortions.

Planes are rarely delayed on the tarmac for hours because of a mechanical problem, in almost every case the delay can be traced to an air-traffic problem or weather. Both of which, can be helped considerably by modern GPS technology and pending, unfunded changes to the air transportation system.

During a recent House hearing on developments in air traffic modernization, Jim May, President and CEO of the Air Transport Association, noted, “were Congress to provide a level of funding comparable to its funding for high-speed rail projects in this year’s stimulus legislation, NextGen (the new air traffic control system) would bd an early reality.”

We need a sense of urgency and a focus on what is most important for our transportation system.

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