Another Friday Night

I am flying back from Aspen today, hopefully early enough to avoid O’Hare ground holds. I wrote this a couple of weeks ago, but decided to wait until my anger subsided to post it, to give me time to edit out some of the more imprudent statements.

Another Friday Night

Another Friday night, another ground hold trying to fly home to O?Hare. This time we sat on the ground in Austin, Texas for an hour and a half. The pilot was really frank; he said that we were two minutes from liftoff and everything was fine, and then they said they would hold us for an hour and 20 minutes. I had called home earlier so I knew that there was no weather/radar reason, and other passengers around me calling people corroborated that information. The pilot later said over the speaker that he knew of no weather events going into O?Hare.

That means it was an air traffic control hold. It?s bad enough for me to get home to my family an hour and a half late, but the worst thing is that I?m surrounded by many fellow passengers who were all supposed to be making connections through O?Hare to someplace else. Now we won?t arrive in O?Hare until after 10, well after many of the last flights have departed. They?ll be stranded and have to spend the night in O?Hare. That is, of course, unless there are other planes full of people whose lives and priorities have been disregarded as much as ours have.

The FAA?s disregard of its constituents is unconscionable and utterly reprehensible. I cannot believe, with all of the soul searching and introspection that federal officials are supposed to have been doing in the past two and a half years, that the FAA and the Department of Transportation can still get away with this appalling indifference to the harms that their bureaucratic policies impose on so many people. The reply I would expect from them, that we may be home late or tomorrow but at least we get home all in one piece, is a pathetic excuse for an unwillingness to engage in some forward-looking thinking and openness to new (or not so new) ideas.

The ability of the FAA to fulfill its mission of securing the safety and reliability of air travel has dwindled into oblivion, largely due to the blinders that its slavish attention to the appearance of ?safety? has cemented on its collective eyes. It continues to apply a top-down, bureaucratic approach to the allocation and capacity utilization of a resource that is pretty scarce on Friday evenings: air space. And although many people have made serious, concrete proposals for ways to price that air space when it?s scarce, the turgid movement of the tentacles that are the FAA policy process has kept those discussions going for close to two decades. Despite all these proposals, many highly detailed and vetted during the FAA?s long period of inactivity on the matter, the FAA has not budged from policies cooked up thirty years ago in a fully regulated market.

The really sublime irony is that this morning when I flew to Austin, I was preparing for an upcoming speaking engagement in which I am going to do a case study on airline deregulation in the 1970s. In preparation I was rereading a lot of literature on the subject, including Severin Borenstein?s useful 1992 JEP article. He noted that at the time the FAA was entertaining proposals for the separation of the commercial air traffic function (which could be privatized or ?corporatized?) from the regulatory airplane safety function, and that most observers anticipated that such a split would not be long forthcoming. It?s been 12 years since he wrote that, and still we have regulatory control of a viably commercial function and regulatory control of a safety function, jumbled together.

Furthermore, the state of air traffic technology has not improved since he wrote those words. One of the inexorable changes that we have seen in modern human history is that technology enables us to use scarce resources more efficiently. The FAA has failed to deliver that value to us in airspace. Indeed, the stunning irony is that much of the consumer benefit that airline deregulation created was through the airlines doing a better job of capacity utilization, and passing those savings on to consumers through the competitive market process. In the air traffic control part of the air travel system, the FAA has failed, and failed miserably, to create anything remotely resembling the kind of value that we created in the deregulation of airlines.

They could contribute to that value creation. First, commercialize the air traffic control function. I?d sell off shares in it myself, but at least contract it out. A private contractor could, as part of the contract, subcontract with a set of equipment providers to roll in a technology upgrade involving GPS, allowing planes to see each other and know their coordinates in real time, as well as optimizing the use of the airspace to the extent consistent with safety. The air traffic control price vector, which would include combinatorial auctions for well-defined property rights in takeoff-landing slot pairs at the 6 airports that have them, would be transparent and would be charged to the airlines. It should reflect congestion charges. Heck, if we can do locational marginal pricing in electricity, air traffic control pricing is a piece of cake!

What will it take to get meaningful change in air traffic control management? Should I start going around to my fellow passengers and ask for their contact information so we can file a lawsuit against the FAA for pain and suffering? Should we send Norm Mineta a bill? Or are the flight scheduling problems we suffer through their perverse idea of rent seeking? I suspect that despite the years of platitudes, the FAA has lost all appreciation for the daily accretion of harms that we suffer at their hands. They could use some rightsizing and be left to oversee a competitive, private market in flight scheduling.