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Conservatives for Big Government: Air Traffic Control Reform Opponents Have Lost Their Minds or Principles

By Marc Scribner
May 10, 2016

Right now in Congress, there is a proposal to end a government monopoly, replace it with a customer-driven corporation, slash taxes, and eliminate nearly two-thirds of a government agency’s budget. Not surprisingly, some Washington insiders oppose it. Surprisingly, some of those opponents are self-described conservatives.

The conservative opposition, led by the Manhattan Institute’s Diana Furchtgott-Roth, wants to scuttle a proposal to spin off the Federal Aviation Administration’s Air Traffic Organization into a nongovernmental nonprofit corporation. On this issue, she is dead-wrong. She previously published two error-riddled pieces for National Review Online, making the false claim that the House’s air traffic control reform proposal would allow controllers to strike (it doesn’t), doubling-down on her factually inaccurate claim even after House Transportation and Infrastructure Committee Chairman Bill Shuster (R-Pa.) corrected her errors.

Just yesterday, a letter from Furchgott-Roth was sent to members of Congress asking them to oppose the AIRR Act. The falsehood that the AIRR Act would allow controllers to strike reappears, as were a string of minor quibbles that don’t square with federal labor law. In an earlier guest post for CEI, former FAA COO and Chief Counsel David Grizzle corrected Furchgott-Roth’s labor policy errors involving strikes, wages, and binding arbitration.

Joining Furchgott-Roth’s coalition letter was Heritage Action, the 501(c)(4) arm of the Heritage Foundation, Vincent Vernuccio, formerly with CEI and now with the Mackinac Center in Michigan, and the Center for Independent Employees. Strangely, it was the Heritage Foundation that in 1982 published Reason Foundation cofounder Bob Poole’s study sketching out the basics of the proposal before Congress today. Poole’s plan was requested by the Reagan White House following the PATCO strike and the House’s reforms have been endorsed by President Reagan’s Secretary of Transportation Jim Burnley.

Noticeably absent from the opposition letter is a single person or group with any experience in transportation policy, let alone aviation policy. In fact, it’s a very short list, dwarfed by the signatories of a recent letter to members of Congress from free market transportation researchers and organization executives supporting the House’s air traffic control reforms.

So, why would Furchtgott-Roth and her small group of allies go out on this limb?

Maybe they believe the legal experts, such as the FAA’s former chief counsel, are attempting to mislead them. But a quick review of the U.S. Code should have put to rest these concerns, as is clear with the false strike right claim. Or, maybe they feel it’s too late to reconsider.

It’s also possible they’ve been duped by Delta Air Lines or the National Business Aviation Association, both of which believe they have a strong business interest in keeping the status quo. The “union giveaway” talking points originated from these corporate opponents. I know this because even before Furchtgott-Roth and her allies began putting out these falsehoods, I was contacted by a corporate lobbyist who tried to sell me on the same nonsense.

Delta and corporate jet lobby NBAA are opposed for purely rent-seeking, crony capitalist reasons. Delta has gone on the record stating:

We feel like we have a forum to work with the government. Richard Anderson our CEO is the current chairman of the NextGen advisory committee. He works with the deputy administrator to make recommendations on what the industry, not just the airlines, thinks the next priorities are that the FAA should be working on in terms of improving performance of the system. Nothing ever happens as fast as you’d like, but we’ve got a pretty good track record of these incremental improvements and that’s given the industry a pretty strong voice in Washington.

So, Delta’s point man on air traffic control basically admitted that he believes Delta can better manipulate the government than a private nonprofit that is accountable to its customers. Note, however, that every other airline is in favor of the reforms, which resulted in Delta resigning its membership in the Airlines for America trade association.

With respect to corporate jet lobby NBAA, the reasons are more classically cronyist. Under the status quo, NBAA’s members account for about 10 percent of air traffic control system use yet pay just one-half percent of the taxes that support the system. Who pays for their subsidy? The rest of us who fly commercial and pay ticket taxes. A cost-based fee schedule conforming to international best practices would eliminate this subsidy to the 1 percent, something NBAA understandably opposes.

The proposed reforms are modeled after Nav Canada, which is the international gold standard for air navigation service providers. Since the Canadian reforms 20 years ago, the fees charged to aircraft operators are now more than 30 percent lower than the taxes they replaced. Given the larger and denser U.S. airspace and economies of scale, the U.S. can reasonably expect even greater long-run savings.

This raises the question: why are supposed conservatives willing to kill pro-market air traffic control reform? Apparently, they’ve either lost their minds or misplaced their principles.

For more detail, see Bob Poole’s lengthy piece at National Review Online explaining why this proposal should be supported and debunking opponents’ misunderstandings.