There Are Increasing Calls To Re-Regulate The Airlines. Here’s Why That Would Be Dumb. | Airlines

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There Are Increasing Calls To Re-Regulate The Airlines. Here’s Why That Would Be Dumb.

I told you back in September that you’d start hearing a lot more about re-regulating the airlines in the months ahead. An advisor to Elizabeth Warren was coming out with a new book making that case. But the arguments are weak and maybe even disingenuous? Because Professor Sitaraman is a really smart guy and he’s studied his topic in depth so surely he has to know that the arguments he’s marshaling are superficial and wrong?

Here he’s interviewed in Salon laying out the reasons why airlines need to be re-regulated.

  • Reduced air service to small cities. He says that unregulated airlines have left too many small cities. But he never stops to ponder why this is. It’s a result of government regulation, not the lack of regulation. Specifically, it’s airline pilots capturing the regulatory process and erecting barriers to entry to becoming a pilot that have nothing to do with safety. That exacerbates a pilot shortage, and drives up pilot wages. Without enough pilots, airlines can’t offer all the service they want to and they cut back on the cities with the fewest fares. In a world of $200,000 to $500,000 a year pilots they can’t amortize the cost of 30 or 50 seat jets as well as they can across 120-180 seat planes.
  • Hubs are inconvenient for passengers. He says that airlines used to fly point-to-point but now passengers have to connect. But he doesn’t look at actual schedules showing how many more flight options customers have with connections, and how that increases competitive options (that, for instance, American, Delta, United and Southwest may all be options in a given city to get between two points).

    And point-to-point certainly wasn’t how the small cities airlines are abandoning used to see air service. He’s implying a world where you could fly from Peoria to Dubuque, Iowa…

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