It is noteworthy that the panel of experts who convened to review
and report on the Department of Transportation's proposed airline
competition policy affirmed that the government "must take decisive
steps" to foster open and equitable rivalry between established
carriers and new entrants.
After all, it is with the ultimate public good in mind that
supporters of deregulation (in this case, the experts) and federal
interventionists (the DOT) can agree that a level playing field,
however it is achieved, is the sine qua non of a healthy market
Alas, as in so many other knotty disputes, the goal is the easy
part. How to get there? That's the question over which reasonable
people can -- and do -- disagree.
The panel, which was mandated by legislation that some observers
charged was designed to kill the DOT proposals, envisions
competition being enhanced by the expansion of airport capacity;
the elimination of airport slot controls and perimeter rules; a
review of international airline alliances, and the monitoring of
travel agent incentives (as if commissions had any more impact on
airlines' behavior than the price of peanuts).
Transportation Secretary Rodney Slater, on the other hand, said
as recently as last September that "we're going to stand
foursquare" against practices such as predatory pricing that are
designed to cripple new or low-cost carriers.
If push became shove, we would opt, reluctantly, for the
experts' trickle-down and less intrusive approach to competition
(of course, without the travel agent commission silliness).
After all, a Department of Justice antitrust suit against
American Airlines eventually will wend its way through the courts
and be instructive in determining the government's ultimate
approach to predatory pricing. We think the DOT should wait,
however long, on that eventuality.