Can the Government Save the Airlines?


Bloomberg News via the Cincy Enquirer reports on government plans to create a "roadmap" (skymap?) for the flagging airline industry.

Carriers in 2009 have offered the fewest flights in six years as demand slumped during the recession. The 9/11 attacks, record fuel costs and other hurdles have also buffeted airline earnings this decade. North American carriers are likely to lose $2.6 billion this year, the International Air Transport Association said in September.

There are some serious issues facing the industry," [Transportation Secretary Ray] LaHood told reporters after a four-hour meeting with industry officials on Thrusday. "A lot of businesses have cut back on travel. It's really caused some economic hardship on the airlines."

Hang in there, baby, because "a government advisory panel will be formed and will conduct its work for about a year," says LaHood. More here.

That should fix it all, right? Here's one thing that certainly won't help consumers (and hence the industry in the longer run): The AP reports that

Three decades of airline deregulation have helped make air travel more accessible to consumers through lower fares.

Now labor unions are questioning whether the industry is paying the price, and the Obama administration is listening….

"A safe, secure, stable industry can't be driven by lowest common denominator," said John Prater, president of the Air Line Pilots Association. "The cheapest fare out there will not give us a transportation system that works for everyone."

Actually, when you look at, the past three decades have been safer than ever and basically cheaper than ever. And for all the airline's bellyaching, the downturn is clearly mostly related to the recession. Whether specific airlines go in and out of business (who mourns for Eastern? Braniff? TWA?) is less important than whether air travel is more widely available. More on that here. (Hat tip: BretJacobson.com).

Coming this week: A Reason.tv video that explores the politics of air-traffic delays.