Airline Consolidation: Just Like the Banks?

A friend shared an article that included a variation of this diagram about bank consolidation.
Notice the pattern: banks consolidated from 37 in 1994, to 19 in 2001, to 11 in 2005, and to only 4 in 2009. Banks became less accountable and more inclined to gouge customers for absurdly high ‘fees’ (e.g., stuff like $31 for each ‘overdraft’ debit card usage, even for $1 or $5 purchases … they offered so many conveniences, but not the easy service of automatically alerting customers and rejecting the debit request at the point of sale). The greed-driven policies at the consolidated banks eventually created a financial meltdown. They were labeled ‘too big to fail’, so as to justify the enormous bailout by federal officials, using public funds. Our public funds, used to reward the overpaid bank greedsters.

It struck me that the diagram looks just like what has happened with U.S. airlines, where today the vast majority of passengers are ‘served’ by only six airlines and the so-called ‘regional’ feeders they contract with. Our final six are American, Delta, Southwest, United, Alaska and JetBlue.

If there is one big trend that we can all agree is happening in the U.S. and across the planet, it is industry consolidation and globalization. The gap between big and small, and the fraction controlled by big, just keeps growing. We now have fewer (but larger) banks, grocers, hospitals and immediate-care chains, gas stations, telecom providers, etc. It is also reflected in the widening wealth gap between the 1% and the 99% … and, again, not just in the U.S., but also in corrupt banana republics and across the globe.

We only hope that this trend is not driven by corruption even in nations like the U.S. We only hope that, if in fact this trend is as unsustainable as it appears to be, the ‘market correction’ will be peaceful and not too painful. Are we becoming the biggest Banana Republic in the history of the world? We only hope not.

Yesterday’s SkyJustice Phone Conference

The featured speaker at the 9/29/2018 Sky Justice National Network monthly phone conference was Jim Spensley. Airline and airport consolidation was front and center. A few of the many interesting points discussed included:

  1. The ‘final-6’ airlines are consolidating their schedules into fewer (but larger) hubs; i.e., while a few airports are seeing growth in annual operations counts, most airports have declined substantially for decades now. [for data, see the aiREFORM analysis at this 1/17/2018 Post (1990 vs 2005 vs 2016 Operations: Exposing FAA’s Inaccurate Forecasts), and see also this 10/23/2017 aiREFORM Post (NAS Annual Ops Have Declined for Decades Now, And NextGen Is Just Hype)]
  2. Most commercial service airports within the U.S. National Airspace System (NAS) offer monopoly or near-monopoly service; i.e., the predominant pattern is either only one airline offers direct service between two airports, or one airline has strong dominance on that airport-pair. This pattern appears to be an antitrust collusion between airlines; it also appears that federal regulators, including DoT, DoJ and FAA, are willingly not acting to end this antitrust collusion. [see this 2014 aiREFORM analysis (A Table Showing the ASPM-77 Airports – (Peak Years, Traffic Declines, and Trends Toward Airline Monopolies)]
  3. While the general public assumes there is an economy of scale that lowers unit costs and thus causes ticket prices to go down at larger hub airports, the opposite appears to be happening. Two key reasons are:
    1. the monopoly power held by the hub-dominant airline enables them to get away with setting much higher prices; this is especially true on those feeder routes to/from cities served by no other airlines.
    2. the airport authority accumulates an enormous debt burden for massive airport infrastructure expansion, all of which is predicated on continued unsustainable growth rates. In other words, a balloon is inflated, catalyzed by FAA grant funding and laws that incentivize hub concentration, and the balloon becomes primed to burst. The sudden popping of an airport hub balloon can be triggered by a general economic downturn, or it can happen if/when the hub-dominant airline arbitrarily decides to move to another airport; a prime example is the former Delta hub near Cincinnati [KCVG].
  4. There are other, environmental costs associated with these consolidated hubs, borne by residents and other ‘non-airport stakeholders’, but both FAA and airport authorities work hard to ignore and even deny these costs. The consolidation of flights into fewer but larger hubs causes more noise impacts (both persistent and repetitive noise patterns), more air pollution (thus more health costs), more destruction of residential neighborhoods and communities due to ‘land-grabbing’ by the airport authority, etc.
  5. One of Jim’s key points was that the airport authority has considerable power to set policies, to choose to NOT expand excessively … but the airport authorities tend to be beholden to the airlines, especially the hub-dominant airline. Why would someone like the Port of Seattle, PANYNJ, or Massport be so subservient to the hub-dominent airlines? It all comes down to money, needed to expand plans (and annual bonuses, in some cases), and also needed to pay off past and future development debt. The fear of an abrupt airline departure – like Delta did at KCVG, American did at KSTL, and United is now doing at KCLE – creates a peonage, rendered on a massive scale.

Solutions?

So, who can solve the growing impact problems caused by airline consolidation and hub concentration? If both FAA and airport authorities are effectively captured, serving industry, we can expect they will continue to play a good-cop-bad-cop game, passing citizens back-and-forth to each other while offering no answers and no solutions. This is where we are today. It is why we depend even more on our elected officials. Especially in Congress, we need them to change the laws; take back what was taken from the people in the 1990 passage of ANCA [see this 6/9/2015 aiREFORM Post (Wendell Ford’s Edsel: Many of FAA’s NextGen Dirty Tricks were Also Used in the 1990 Passage of ANCA)]; restore local control, to include ensuring local residents have power over their airport authority; even, impose a steep carbon tax on aviation fuel, so that excessive airline hubbing is disincentivized.


See also:

Who is to Blame – and Who Can Fix – the Impacts Around U.S. Hub Airports?

‘Rush to Reauthorize’, or should we bear down and ‘Get it Right This Time’?

The two houses of our national Congress have reportedly hashed out some details that may enable them to quickly reauthorize FAA. Is this good, or is this not so good? Should we ‘Rush to Reauthorize’, or should we bear down and ‘Get it Right This Time’?

I am for the latter, for three reasons. First, we are stuck in a rut (aviation over-expansion at all costs, with no accountability) that will not change, so long as we apply bandaids onto dirty wounds. Second, when we rushed to reauthorize the last time, it gave us horrible new laws like expanded CatEx; simply, rushed reauthorizations NEVER turn out well. And, third, the key lobbyist for the airlines (A4A) announced today, they ‘applaud’ this Congressional progress … which, frankly, coming from A4A, is like the smell near a run-over skunk; i.e., if A4A is for it, then whatever ‘progress’ Congress has made is almost certainly filled with industry privileges and community damages.

Some activists will be excited to see a glimpse of ‘progress’, too. But, be careful to not feel so beaten down that ANYTHING even slightly positive becomes something to thrill over. It is much like how people dying of hypothermia feel oddly warm just before their end. Stay focused; stay strong; know what industry and FAA are aiming to pull off; and, demand real reforms.

Reclaiming FAA for ‘WE THE PEOPLE’

Here is a PDF with a short analysis of the current situation, by aiREFORM:

Click on the image below for a scrollable view; the PDF file may be downloaded.

It is worth repeating…

…We can have a federal agency that serves WE THE PEOPLE, not just industry. We can benefit from aviation, while also ensuring aviation does not diminish our lives. And, this industry is strong enough to prosper without playing FAA and too many elected officials like puppets. But, nothing can happen, nothing will happen, until Congress steps up to the plate and reclaims FAA.

Demand real reforms at FAA. If this agency is too arrogant and too power-obsessed to heel, take away their power. Give that power back to the people, where it belongs.

Now is the time, Congress; you need to step up and serve the People, not the corporations.

10 Sample Questions for the Sea-Tac SAMP ‘Scoping’

More fine work by Quiet Skies Puget Sound. Check out the 2-page PDF below, their sample questions to try and get Port of Seattle (POS) to fully address health and environmental impacts within the so-called ‘Sustainable Airport Master Plan (SAMP)’ review process.

Click on the image below for a scrollable view; the PDF file may be downloaded.

A quick note adding on to #9 of the suggested questions in the PDF above (“What if Your Projections Are Wrong?”): aiREFORM! did a quick analysis of monthly operations at Sea-Tac, using FAA’s own ATADS data, and it suggests substantial growth is again happening this year. In fact, at the current pace, the operations total for 2018 will be roughly 439,600, an annual increase of 5.6%. This is what happens when airlines double down on profits via hub through-passengers; we see impactful growth rates that have no connection whatsoever to the local population or economy (i.e., it is purely airline ‘demand’, accommodated by the airport authority and FAA).

And one closing comment…

That POS has chosen to add the word ‘Sustainable’ in front of this latest airport master plan is quite out of touch with a stark reality: aviation is the most fossil-fuel intensive activity we arbitrarily do, and as such aviation is the fastest way to further pump up record CO2 levels and further destroy the future climate and habitability of our planet. Calling this ‘sustainable’ is like putting lipstick on a pig to make her ‘pretty’ (I mean no offense to pigs; they are beautiful too, after all).

‘We Have A Dream’ Letter

Another good example of activism, this time a letter from Plane Sense 4 Long Island, to the acting FAA Administrator. Their dream is shared by people across the nation, who need Congress and FAA to repair the damages being done under the NextGen program. Check it out:

Click on the image below for a scrollable view; the PDF file may be downloaded.

‘We The People’ refuse to continue to be FAA’s Collateral Damage

The previous aiREFORM Post discussed two recent industry letters, sent to key U.S. Senators. The logo-saturated letters were sent by dozens of aviation industry coalition members. They pushed for a quick passage of FAA’s Reauthorization bill, and they also pushed Senators to ignore the many noise and pollution impact-related amendment proposals. The centerpiece of the aiREFORM Post was a ‘possible’ letter by the same coalition, suggesting what they would have written if they were temporarily honest, somewhat apologetic, and freed from their aviation greed. Check it out here.

At last week’s Sky Justice National Network teleconference, an activist from the New York City area made a great suggestion: we need to band together and present key Senators with OUR LETTER – a letter from all of us, pressing for no reauthorization passage until needed FAA reforms are added. Well, after some discussion by a handful of activists across the nation, the letter is finished. The plan is to gather as many signatories as possible – activist groups, individuals, even municipalities and local officials – and then send the letter to Majority Leader Mitch McConnell and Minority Leader Chuck Schumer.

What’s In The Letter?

The letter is fairly short. It presents the NextGen impacts in the context of failures by both FAA and our elected officials. The letter lays out key facts about disinformation in the coalition letters, as well as FAA’s NextGen history. The letter directly requests that the U.S. Senate do their job by debating the NextGen impacts and compelling FAA to repair the damages they have done. Here are two excerpts from the letter:

“Congress authorized FAA’s NextGen program in 2003. Sadly, the NextGen implementation has proven to be a full-frontal attack on citizens and communities, solely to benefit airline profit-margins. Routes have been concentrated and lowered, forcing citizens to lose sleep and forget peace under nearly nonstop noise assaults. The noise diminishes mental health and civility, while the air pollutants destroy our cardiovascular health, especially for children and the elderly. This is oppressive and unjust.”
“FAA is using NextGen as a hammer to disempower people. Local communities need Congress to restore meaningful local control, so that airlines and airport authorities can no longer metastasize their hubs into airports that are ‘Too Big to Fly’, airports that are brutalizing the people below.”

When Will The Letter Be Published?

The actual letter will be fully publicized after it is mailed, which is planned to happen before the end of August. For now, it is important that we get the largest possible number of signatories. Those wanting to sign or learn more about the letter can contact Jana Goldenberg or Elaine Miller at Plane Sense 4 LI, using this email address:

Ps4longisland@gmail.com

A Letter They Would Never Send

There is a recent big push by industry players to get the U.S. Senate to hurriedly pass reauthorization legislation without needed environmental impact amendments. This push is reflected in two ‘coalition letters’, sent on July 26th and August 15th (click on the dates to view aiRchived copies).

Both letters are disingenuous and packed with disinformation. This is incredibly insulting to the thousands across this nation whose homes and health are being destroyed by NextGen, Wake Recat, OAPM, and other FAA programs. We are seeing our Democracy hijacked by slick collaborated propaganda. And, we are seeing our elected officials corrupted by their obsession with reelection funding; they express concerns to the little people, but their actions and their histories expose their true bipartisan loyalty is to corporate power. These elected officials are owned.

What if this ‘coalition’, these groups, dipped their cups in a koolaid bowl filled with temporary truth serum? Might their letter look like this?

Click on the image below for a scrollable view; the PDF file may be downloaded.

Obviously, this is NOT the letter sent by A4A, NBAA, and other groups. No, this letter is what these groups should be writing, what they would now send to Senators McConnell and Schumer, if they cared to clean up their mess. But they don’t care about anything beyond industry profits to fatten their own annual benefits and bonuses.

Some are suggesting that we activists need to work together, send OUR LETTER to these Senators, and get them to serve OUR INTERESTS. Time to get to work.

Aviation growth ≠ Economic Growth

In the U.S., we have thousands of people being victimized by the diminished health and destroyed residential quality of life, under NextGen’s “pack’em tight and keep’em coming” automated flight routes. The airlines are getting richer and, this time of year, too many of us have to smell jetfuel if we dare to barbecue in the backyard.

If Canada was part of our NextGen program, Toronto (by far the busiest Canadian airport) would be their highest-impact area. Pearson Airport [CYYZ] is their biggest airline hub. One thing to understand, though, is NextGen is just a brandname, conspired by industry and FAA, and brandished all over the place to fool people into thinking it is something new. It is not. It is just a brandname. The real changes are happening worldwide, and are due to the widely homogenized digital systems that enable aircraft everywhere to be operated almost entirely using automation – both by pilots and air traffic control (ATC). Consequently, the impacts around Toronto are exactly like the impacts around Seattle, San Diego, Charlotte, Boston, and all the other major U.S. hubs: repetitive, low, slow and loud, often with turns incredibly close to the runway.

Here’s a letter to the editor worth archiving, from Toronto: (click here to view original)

Click on the image below for a scrollable view; the PDF file may be downloaded

Aviation growth ≠ Economic Growth

Aviation growth = Economic Growth – Community Impacts

Yup. The math is that simple. So long as costs are ignored, it looks like pure benefits, right?

People are talking about this one. Good letter.

One of the leading activists about NextGen sent me a note with her thoughts: 

“…I like the equations in that Toronto letter.
I don’t know if it is a conspiracy or negligence.  What they are doing now is the “benefit” part of a cost/benefit plan and analysis, completely ignoring all of the costs to individuals on the ground and communities.
The advertising, the spin, the propaganda, and the Pollyanna attempts to make it all seem good without also mentioning the negatives, the consequences, the price individuals and other industries, e.g. healthcare, pay for the airline industry’s proclaimed success is misleading.  It is hard to know if the twisted focus on the positive and the hiding of the negatives is conspiratorial or wishful thinking + ignorance….”

Part 2: “It is like being broken up with on a Post-It note”

More details to ponder about FAA’s latest tantrum: their refusal to communicate with Marylanders because the good Governor has filed a legal challenge against FAA. Sheesh.

Washington Post followed up on the Baltimore Sun news story. (click here for the source article, click here for an aiRchived version) The piece was by Michael Laris. There is a common and consistent problem with articles by the mainstream media, including Washington Post. In the middle of this article, a paragraph implying NextGen benefits is inserted, but none of the alleged benefits are supported by any real data. That is to say, the suggestion of addressing congestion fails against the reality that total airport operations (takeoffs and landings) at the main passenger airline airports have actually declined 14% between 1989 and 2017; in other words, the only ‘congestion’ is accommodation of airlines who ‘demand’ that a select few airports become superHubs. (click here for a 3-page PDF analysis; the combined data showing the 14% decline is at the bottom of page 3) And, as for efficiency, the only ‘gains’ are potentially realized by subverting the environmental review process (e.g., liberally applying the CatEx) to impose highly impactful routes with turns lower and closer to airport runways.; in other words, FAA is orchestrating a wholesale dismissal of environmental concerns.

There’s another important detail to consider, about the Baltimore-Washington airport. According to the Bureau of Transportation Statistics (BTS), Southwest is by far the dominant airline at KBWI, with nearly 69% of passengers. (click here for BTS website, click here for an aiRchived copy of the KBWI airport report) So, if FAA imposes changes that increase both impacts and airline profit margins, Southwest is the key player who could, in a very neighborly way, advocate on behalf of impacted residents. When is the CEO of Southwest Airlines going to stand up and protect community quality-of-life and health, by telling FAA to fix these new routes? If Southwest did this, they would stand to build even greater customer loyalty. That, coupled with their near-monopoly at KBWI (and dozens of other U.S. airports, BTW!), is always a good business move.

“It is like being broken up with on a Post-It note”

Alternatively, it is like the spoiled brat kid who, seeing his failure to get his way, abruptly takes his toys and leaves the sandbox.

Yes, this is today’s FAA.

A few years ago, FAA implemented NextGen changes that are destroying neighborhoods under heavily travelled repetitive flight segments. When people in Maryland had enough, they organized. Part of their organization was to accept FAA’s preferred process, creating a community roundtable, filled with concerned volunteers.

Now, the game plan for roundtables (and other aviation citizen-committees) includes lots of rigging. Be sure their work product conforms with what FAA/industry want to see. Assert some control. For example, FAA and the airport authority make sure plenty of pro-aviation participants ‘volunteer’ to be a part of the group. Also, the agendas for at least a year are stacked with sleep-inducing program scraps, long and boring sessions sharing koolaid glasses filled with technobabble and irrelevant metrics like ‘dNL’. Despite these shenanigans, most groups do seat at least one or two real activists. The kind who will not and do not give up. And, as happened in Maryland, sometimes real support is gained from local and state elected officials.

So, what’s going on here? Just another FAA temper tantrum. This time because the good Governor and his Attorney General took FAA to court, to protect Maryland’s people.

What’s the shortest way to spell ‘spoiled brat kid’? I’d try “F-A-A”.

Click here for the original Baltimore Sun article.

Click on the image below for a scrollable view; the PDF file may be downloaded.

Now, how about a few questions:

  1. At what level of FAA was this decision made? This is a heavily top-down bureaucracy, to the point where a Deputy Regional Administrator doing as Ms. Stanco did was only following orders. So, how about if FAA produces all the records that flesh out why this decision was made, and who really made it?
  2. What level of outrage will we see from our federal elected officials? Will any of them demand FAA end their tantrum? Will any of them demand full transparency and accountability, including production of all records (see #1 above)?
  3. When will our Congress step up and do their job, serving the people? When will local communities become re-empowered, to the point where they can manage capacity at their local airport, guarding against excessive airline hubbing and scheduling?

NextGen CONTINUES to be FAA’s Carte Blanche for Serving Industry

Late last year, an excellent article by Barbara Castleton was added here, in the ai-Rchives. A couple weeks ago, quite a few people started sharing this article at various social media sites related to airport impacts.

The November 2017 aiREFORM Post included a scrollable PDF copy, with footnotes added. Well, six months later, we decided to take a fresh new look at Barbara’s article, relate it to what FAA has done since, and create a new version, with new footnotes added. Of course, we did NOT look at the old footnotes until everything was finished. It is interesting to see how little has changed, and yet, too, how much more clearly the NextGen impact issues appear to be coming into a sharp focus.

Click on this link to view the Post from last November; click on the black pop-out button on the scrollable PDF below (upper right corner) to read the latest analysis: