In the Hot Seat
Bob Poole, director of transportation policy at the libertarian
Reason Foundation think tank, explained why he hopes Congress this year will pass
a privatization bill for air traffic control. Read More
President Donald Trump's endorsement last month of a plan to
privatize the U.S. air traffic control (ATC) network has given the proposal's
chief backers on the House Transportation Committee and in the U.S. airline
industry a vital ally.
"I think it will make a big difference," said Bob
Poole, director of transportation policy at the Reason Foundation, a
libertarian think tank, and a backer of privatization. "A number of
Republicans who have been on the fence about this idea will have to take it
Still, it remains unclear whether the president's support
will be enough to overcome bipartisan opposition within the Senate and within
appropriation committees in both chambers.
Rui Neiva, aviation policy analyst at the Washington-based
Eno Center for Transportation think tank, explained the reluctance of lawmakers
by saying, "It's $11 billion that they won't get the chance to give out."
In its March 16 budget blueprint, the Trump administration
called for a multiyear transition from the status quo, replacing a system that
has the FAA running the U.S. ATC network to a model in which ATC would be
overseen by an independent, nongovernmental organization.
Trump's endorsement was cheered by the trade group Airlines
for America (A4A) and House transportation committee chairman Bill Shuster
(R-Pa.), who has been the leading congressional champion of privatization.
With input from A4A, Shuster last year sponsored a bill to
have ATC overseen by a nonprofit organization managed by a board of aviation
Commercial airlines were to have the most seats on that
13-member board, with four, but they were still to have been a minority. Other
stakeholders, including the general aviation community, airline pilots, the
National Air Traffic Controllers Association and the federal government would
nominate people for the board.
The organization's framework was modeled after Nav Canada,
the nonprofit that runs the Canadian ATC.
Last year, Shuster had little difficulty shepherding the
proposal out of the House Transportation Committee as Congress was working on
its most recent FAA reauthorization. But privatization was never featured in
the FAA bill passed by the Senate Transportation Committee and then on the
Opposition from the House Appropriations Committee helped
prevent the measure from getting a vote last year on the House floor.
The dynamic seemed little changed this year, at least in the
Senate, ahead of Trump's formal decision to support ATC privatization. In late
February, ranking members from both parties on the Senate Appropriations
Committee and the Senate Transportation Subcommittee signed a letter opposing a
move to the Nav Canada model.
Proponents of the move, including the air traffic
controllers union, said it would speed implementation of the satellite-based
ATC system NextGen, which is to replace radar technology while removing ATC
from contentious appropriation debates in Congress.
But opponents, notably including Delta, said the complicated
process of privatizing will itself delay NextGen implementation. Meanwhile,
consumer groups said privatization would make the ATC system less responsive to
the general public. General aviation groups also oppose the proposal, saying
that it would disadvantage small communities and give too much power to
Privatization critic Bob Mann of airline industry analysts
R.W. Mann & Co. said that supporters have offered no metrics relating to
operational performance, logistics or costs that would justify privatizing the
"There's not even a suggestion in these proposals that
says what they're going to do better," he said.
For its part, Nav Canada has had a good record on fees,
especially after a bumpy few years following its establishment in 1996. The
company's fees now are lower, even without adjusting for inflation, than they
were in 1999.
A direct comparison between what U.S. air travelers pay to
support ATC and what Canadian flyers pay isn't possible. That's because U.S.
flyers support ATC through ticket taxes and fees that go into the general
treasury, from where they are redistributed to air traffic control and other
programs. Nav Canada, meanwhile, bills airlines for fees directly and the
carriers then pass those costs onto consumers.
Nevertheless, a February Eno Center analysis, which the
authors acknowledged was merely a "crude comparison," found that U.S.
flyers would pay approximately double in ATC-supporting passenger fees for the
typical flight as Canadian flyers. In a series of case studies, the Eno Center,
which backs privatization, also reported that Nav Canada's fees bested fees
charged in the private ATC models of Germany, the U.K. and Australia but were
costlier than those of New Zealand.
The Office of the Inspector General also took a look at the
Canadian, German, French and British ATC systems in a September 2015 report.
In the four countries, the report said, safety in the skies
was not compromised when air traffic control was either privatized or, in the
case of France, separated as its own governmental entity. However, each of
those organizations oversees an ATC system that is far smaller than the U.S.
system, and none have undertaken a major modernization effort comparable to
Mann questions whether such a
modernization is even necessary.
"NextGen is an empty shell," he said.
Delta, Mann said, has succeeded in more efficiently
utilizing the air space around major hubs such as Atlanta and Detroit by investing
in a software solution called Attila.
He said the competitive advantage Delta has gained from that
investment is one reason it stands opposed to privatization. (Delta declined to
comment on Attila for this story.)
Poole, despite his support for privatization, said he is
surprised other U.S. carriers haven't adapted Attila. Still, he said, the board
of the ATC company could review NextGen to determine what will and won't work.
"I would be astonished if there weren't significant
changes" put in place by a private ATC operation, Poole said.
He added that structurally, a private company could more
easily spur innovation than the FAA. Plus, Poole said, from a safety
standpoint, it's important to separate the management of ATC from its safety
oversight, both of which are currently the responsibility of the FAA.