What could prove to be one of the year's more interesting airline stories hasn't yet burst into national headlines, but it's a hot topic of debate in Houston.


In one corner, Southwest Airlines is proposing to build an international terminal with customs facilities at Hobby Airport for future Southwest/AirTran service to Mexico, the Caribbean and Latin America.

In the opposing corner stands United, the world's largest airline, which just moved heaven and earth to acquire Continental and its hub at Bush Intercontinental.

The referee is City Hall (Houston's municipal government runs the airports).

Despite opposition from United, Houston's dominant airline and a huge employer in the area, the city's airport director, Mario Diaz, recommended that the city approve the Southwest plan and get on with it.

We second the motion, not because we favor Southwest over United, but because we favor open markets over politics and regulation.

If Southwest and United are to square off against each other, let them compete for passengers in the marketplace, not compete for votes in front of the Houston City Council.

As Diaz put it in his recommendation to the mayor, "It is not the city's role, nor is it in the community's best interests, to act as an arbitrator between two competing carriers over airport access. Rather it is our duty to help provide a level playing field for competition to flourish."

And it's not just about Southwest. Diaz said in his report that other airlines have also expressed interest.

Consultants estimate that Southwest's plan would generate an additional 1.5 million air travelers for the region, support more than 10,000 jobs and produce an annual economic impact in excess of $1.6 billion -- to say nothing of the benefits generated by competition on international routes, something Houston now lacks.

In our view, it's no contest.
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