Lack of a coordinated national policy on aviation is “shocking”

By Patrick Burnson, Executive Editor
March 19, 2012 - LM Editorial

The International Air Transport Association (IATA) is urging U.S. policy makers to improve aviation competitiveness by easing the tax and regulatory burdens on the airline industry.

“Aviation generates up to $1.3 trillion in annual US economic activity and 10.5 million jobs and accounts for up to 5.2 percent of GDP, according to a Federal Aviation Administration (FAA) study. The U.S. has one of the most mobile populations on the planet thanks to commercial aviation. Each and every flight creates jobs, enables commerce and drives connectivity. Policy makers at the state and local level recognize these facts and they work hard to ensure connectivity by attracting air services. But while aviation gets a lot of attention in Washington, it is not always focused on the priority of using aviation as a catalyst for economic activity,” said IATA’s Director General and CEO Tony Tyler in his remarks to the recently-concluded 37th FAA Aviation Forecast Conference.

“If creating jobs and encouraging economic growth is a national policy priority, then the lack of a coordinated national policy on aviation is shocking. A national policy is needed and it must be aligned with the economic needs of communities, states and regions—with the goal of improving the competitiveness of the US aviation industry,” said Tyler.

U.S. airlines have gone through a decade of dramatic restructuring during which the industry has lost more the $62.5 billion, laid off 25 percent of the workforce and cut domestic departures by 21 percent. Many local economies have seen the impact of the reduced connectivity and are working hard to provide the conditions to maintain services. But there is a policy disconnect between what is happening locally and the national focus.

“If you want to discourage something, wrap it in a web of restrictive regulations and taxes. Taxes and fees now represent 20 percent of a U.S. ticket. The Administration’s 2013 budget proposal heaps even more taxes on aviation, with much of the receipts used to balance the budget or reduce the deficit. When Washington does look beyond taxes, the agenda often bogs down on complex problems that defy easy regulatory solutions or commercial matters that should be left to the workings of the free market,” said Tyler.

“Adam Smith’s Invisible Hand is a more reliable guide in commercial areas than the hand of regulators. Unfortunately, we are seeing the U.S. retreat from the free market principles for which it is so well known. This desire to regulate market behavior flies in the face of the U.S. deregulation experience, the undeniable conclusion of which has got to be that the market is ruthless with airlines that fail to meet customer expectations,” said Tyler.



About the Author

image
Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Not surprisingly, the December 31, 2015 deadline for freight railroads to install Positive Train Control (PTC) technology on 40 percent of its network, as per a mandate from the Federal Railroad Administration will not be met. That was the chief takeaway of a report from the Association of American Railroads.

When the Warehousing Education and Research Council (WERC) convenes for its annual conference in Chicago next week, they’ll be visiting the nation’s largest inland port.

The newly created and expanded alliances of P3 and G6 will certainly review and revise port calls, but the shift in initial deployments will be subtle, says Neil Davidson, senior analyst of ports and terminals for Drewry Research.

“U.S. Port Update: Investing in the Future” will feature a panel of three industry leaders from the East Coast, Gulf, and West Coast discussing their relative challenges and opportunities.

Zebra gains instant access to complimentary technologies. But first, it needs to integrate a former partner that is 2-1/2 times its size.

Article Topics

Blogs · Air Freight · Air Cargo · Trade · All topics

About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review. Patrick covers international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. Contact Patrick Burnson

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA