Mike Huether gets some free press for his 2018 buzz-building effort by co-signing one little letter with six other South Dakota mayors to Senator John Thune. The Sioux Falls mayor, like a hundred-some mayors of smaller cities from all 50 states, wants Senator Thune, in his capacity as chairman of the Senate Commerce, Science, and Transportation Committee, to resist a proposal to privatize the nation’s air traffic control system.
While the horserace blog mutters insultingly and unenlighteningly about the political smoke signals, let’s look at the actual policy that Huether and fellow South Dakota mayors Jerry Toomey from Mitchell, Carl Shaw from Edgemont, Steve Thorson from Watertown, Paul Aylward from Huron, Marty Huether from Wall, and Mark Carstensen from Sturgis are arguing:
Privatization would hand over decisions about infrastructure funding, taxes and fees, consumer complaints, noise, and many other priorities, to a board of private interests dominated by the commercial airlines. These are the same airlines that have cut back flights to smaller communities by more than 20 percent in recent years, and have stated their intent to divert investment from small and mid-sized communities to large ones where the airlines are most profitable.
We are also concerned about costs and access. For example, the Canadian, privatized system, which is often held up as the system the U.S. should emulate, is more expensive than the system we have in the US by miles flown. In the U.K., that system has seen “more delays, higher fares and reduced connectivity” at London’s airports since privatization. So while we all agree that modernizing our air traffic control system and investing in American infrastructure should be among our highest priorities, privatization is not the answer [Mayors Mandell, Goings, et al., letter to Senator John Thune and Senator Bill Nelson, 2017.03.06].
Donald Trump seems to support privatizing air traffic control, but he only knows what his private pilot tells him. The airline industry (with the exception of Delta) says privatizing air traffic control would allow for faster replacement of ground-based radar with satellite-based control. One conservative writer contends that the plan floating around right now isn’t really privatization but a quasi-governmental entity like Fannie Mae or Amtrak that would cost more than the current system. Delta Air Lines agrees, saying privatization raised air traffic control fees 59% in Canada and 30% in the U.K.
Regardless of what Mayor Huether runs for next year, he appears to be on the right track on air traffic control. It ain’t broke—nobody has bumped into anybody in Sioux Falls airspace—and privatization won’t fix it.
Predictable Knee-jerk reaction: Government good. Privatization bad.
Doesn’t require one to think.
Typical knee-jerk reaction by Troy: ignore all of the policy arguments presented in the article and reduce the arguments to sarcastic platitudes. It is as if you read only the headline and then comment.
Soon everyone will be responsible for their own personal air traffic control. When you check-in they will give you a headset….for a small fee.
Photo op will do whatever he is told, and slick Mike will be right behind him.
Darin,
I have not reached a definitive position on it. But, what I know isn’t shallow and I understand the merits of both positions. Based on what I know, I’d probably not privatize but there are some compelling rationales for at least a partial reduction on aspects performed directly by the government.
If these arguments are the depth of these Mayor’s understanding, they are making nothing more than a political appeal of self-interest and display their shallowness. They like the status quo. Well, the status quo is antiquated and future demand is going to implode the current system. A long-term solution requires comprehensive thought. These mayor appear to not be interested in real thought.
And, then Cory jumps on it because it feeds his ideology. Ideologues don’t have to think, gather information, and do analysis. And, they get to spout out bromides about which they know nothing. These Mayors and Cory are made for each other.
If privatization would save the Feds money then let’s privatize the rural airports where nobody flies to and are overly expensive to maintain.
Come on Cory, SD needs to learn to not be such a Federal Welfare state. Being second in grabbing federal dollars is nothing to brag about.
Troy, the current system could implode in the future as you say, but only if adequate investments are not made to upgrade it. It is just like the interstate highway system. If we don’t maintain it, it will fall apart.
Your party likes to starve government of funding for necessary technological improvements and then point to the inadequate service as reason to privatize it. It is your own self fulfilling prophesy.
I think there are times when relying on the private sector is advisable. But there are many occasions when privatizing functions traditionally performed by government is not a “good deal” (to speak in Trump terms). The self-interested profit motive of private firms is not aligned with many of our priorities for public air transportation. To summarize, if you are trying to cut costs to support your profit margin, you may cut things necessary for the level of safety that citizens expect. Short term profit motives can also be at odds with long term safety and reliability concerns. I’m not saying government is perfect by any means, but too often I see Republicans trying to burn down government institutions rather than try to reform or invest in upgrades that are necessary for governmental efficiency.
Republicans seem to be headed down this track of starving the government and then blaming it for poor service in the case of the IRS and the EPA, for example. There are many other examples. I guess it is easier to starve government then to reform it. Republicans seem to be learning this with regard to Obamacare.
“Privatize”! Privatize means someone is going into business to MAKE A PROFIT, right? No private entity starts a business to break even or worse. Ergo, prices will go up or fees will be charged or there will be cutting corners to maximize profit. So, Republicans want to “privatize” air traffic control, social security, medicare, schools, (toll) roads, bridges… How about selling Yellowstone to the Kock brothers or the Grand Canyon to Exxon? Profits, profits, profits… All government is not bad, tho that may conflict with the philosophy of St Ronald Reagan.
Only a conservative could read an article which includes multiple sources to explain and support the author’s viewpoint some of which contain specific detail surrounding anticipated costs and impacts to the deficit, and then claim the article is a “knee-jerk reaction”.
Cory didn’t channel Forrest Gump and state that private air traffic control is bad and “that’s all I’ve got to say about that”. He supported his piece with sources which is a clear indicator he has actually done research on the matter and read available materials and viewpoints from both sides.
Cory’s article isn’t reflective of someone who isn’t required to think, but Troy’s response surely is.
BTW – Delta has solidified its place at the top of my list when choosing air travel. They are willing to put the passenger ahead of profit… hard to find fault in that.
Yes, I have better luck flying Delta from Sioux Falls to Minneapolis and then elsewhere instead of going through Chicago on another airline.
To follow up on Loren’s comment, it is theoretically impossible for privatization, per se, of a governmental function to save any money, absolutely and completely impossible. When the government performs the function, there is no profit to be sought, but private enterprise, by definition, must have profits to succeed.
If an employee, or group of employees, of a private industry can find ways to provide that service for less money, that same employee or group can do the same if employed by the government. The difference is that we all own the government and none of us seeks to profit from that ownership. Meanwhile only investors own private enterprises and as Loren observed, these investors will not invest unless they make a profit, which necessarily adds an expense that is not incurred by our government.
If the government keeps control of air traffic control, they will be able to track incoming drugs especially on border states without having to get records from private business. I also like the reason of keeping the playing field level for small towns so corporate interests do not dictate everything about transportation.
Robert suggests we put everyone in charge of controlling his or her own airspace… which leads logically to the need for weaponized drones.
Bear,
If what you say is true (it is impossible for privatization to save any money), why don’t we have government take over food production, building of roads, making cars, and everything else?
Your understanding of economics is at best lets just say simplistic.
By the way, explain this. Why are meals in prisons by private companies cheaper and more nutritious than meals provided by the prison/government?
Also, explain this:
The airlines supporting privatization (all but one) would prefer to charge their passengers a fee (money they could otherwise put in their pocket) for air traffic control and reduce the subsidy from the taxpayers.
The air traffic controllers association wants privatization. Why would they want give up government wages, benefits, and pension to go to work for a bunch of bad capitalistic companies?
Troy asks:
If your statement is factually correct, the answer seems obvious. The people working for the private company have made decisions that have lowered the cost of purchasing and preparing meals, while improving nutrition. If these same people worked for the government to provide meals, is there some reason they could not accomplish an even better result by making exactly the same purchase and planning decisions, but eliminating the need to assure that investors also made a profit?
And rather than evaluating my personal knowledge and skills Troy, perhaps you can educate us how the necessity of assuring private investors make a profit lowers, instead of raises, the cost of providing government services? Is there reason that the successful employees of the private enterprise could not have had that same success if they were employed by our government rather than by a private company, thereby saving the taxpayers the cost of paying investors for the use of their private dollars?
One more thing: Figure out the logic fallacy from this statement from the Mayors and why it let’s just say a specious argument.
“For example, the Canadian, privatized system, which is often held up as the system the U.S. should emulate, is more expensive than the system we have in the US by miles flown.
Or this one: “In the U.K., that system has seen “more delays, higher fares and reduced connectivity” at London’s airports since privatization.”
As another example of privatization run amock, think of an unregulated privatized toll road. A true capitalistic toll road would exact the maximum amount of profit from the users of the road. The fees would rise until it is truly “highway robbery” to travel on this road. Some traffic would divert to other nontoll roads and society as a whole would suffer from lost time and more cost.
Expanding on BCB’s thoughts, if we properly incentivized the managers and work force within the public sector, including holding people accountable for poor job performance, there is no reason that government can’t run as efficiently and responsively as private enterprise. This is especially true since private enterprise has to cover the profit component of the cost structure to make it worthwhile to make the investments in money and time.
I don’t know enough about the air traffic controllers viewpoint to respond to your question.
And I don’t know where you came up with “bad capitalistic companies.” Just because companies make profits for their investors doesn’t make them “bad.”
My “simplistic” point is simply that, theoretically when all other things are equal, adding the additional expense (investor profit) to the cost of providing goods or services, by definition, increases the cost of those goods and services.
Perhaps you can provide an example to show that adding the cost of paying investor profits does not increase the cost of purchasing goods or services?
Cory,
You will get an alert on your cell phone. Then you just need to click yes to grant permission to anything approaching your personal air space, including those drones that deliver pizza or books from Amazon. Software will automatically divert anything away from any airspace that hasn’t given their permission. Why haven’t we been doing this before ;^)?
Anybody remember former Vice President Dick Cheney’s Halliburton?
Bear,
If you don’t know about any of these issues, why do you have a position?
Regarding your theory it is inherent that a for-profit company will provide a good or service more expensively than a government entity, they debunk it in the first week of Introductory Economics and even extreme liberal economists know your theory is bunk. If you want to have a very elementary understanding of the most basic principles of economics, try to figure out why virtually all the states (even the most liberal) have contracted out their prison meal programs despite having all the equipment to make the meals and nearly free labor. The average cost per meal is lower and the quality is higher (including nutrition). If your theory has even the extreme smallest of economic viability, there is probably nothing more conducive than prisons making the meals for their inmates but they don’t.
Or along the same lines, figure out why colleges and universities are stampeding* to contract out their food service functions. The stampede is occurring because the Obama DOE made some rule changes with regard to work study where the students can work for an outside food service company using work study money. Without the change, colleges and universities were reluctant to contract it out (despite it being cheaper and food quality going up) because they lost this place for students to work.
If you can grasp these concepts, you might then be able to imagine some reasons why it MIGHT make sense to reform the air traffic system as being contemplated. If you are wholly ignorant of some basic economic principles, forming informed opinions with regard to government operations is impossible.
https://www.prisonlegalnews.org/news/2013/aug/15/prisoners-pay-the-price-of-food-cost-increases/
This article explains how it appears to be cheaper to privatize feeding prisoners by cutting corners so privateers profits increase-which is exactly what you expect when any program is privatized.
Speaking of ignorant of economic policies- cutting tax revenues does not increase tax revenues.
Trickle down Raygun-Voodoo economics does not work.
Memorize this, Troy, as if yer life depended on it.
MFI,
If your information is correct, it sure is an indictment of the liberal governors who initiated what has become the norm in the nation. Bad liberal Governors. And to think all those liberal colleges and universities petitioned the feds to adjust the work study program and it was approved. Bad Obama.
“The air traffic controllers association wants privatization. Why would they want give up government wages, benefits, and pension to go to work for a bunch of bad capitalistic companies?”
Reagan made it clear what would occur if the ATCs opted to strike…. basically they would be terminated (which is exactly what he did to those who did not return to work). The ATC association knows if they are privatized, they can form a union that would no longer be under the rules established within Title 5 of the USC.
So if you want the ATCs to have a union then by all means support privatization, but don’t think for a second they are supporting privatization for any reason other than personal benefit.
Craig,
Are all liberals as cynical as you to think the only rationale for something has to be self-interest? You must think everything NEA wants is for personal benefit and not the children? Every poster on DFP must not be promoting a position for the public good but for their own personal aggrandizement?
That said, you sure that is the air traffic controllers motive? What is information do you have to say such a thing? Or are you just impugning their character because you have no information and are cynical?
Troy- Bush from Florida is/was a liberal? Put the corn squeezings down and back away slowly. You are acting like Dame Peggy Nooner.
For example, the Canadian, privatized system, which is often held up as the system the U.S. should emulate, is more expensive than the system we have in the US by miles flown. In the U.K., that system has seen “more delays, higher fares and reduced connectivity” at London’s airports since privatization.
OMG, Troy profiteer’s sky is falling. Save them with voodoo economics.
Troy has made several statements that could use exploration. Let’s start with this one:
Cool! If it is so easily debunked perhaps you would show us less educated folks by sharing the debunking information rather than simply making conclusory claims?
As for prison meals, mfi has linked information that appears to challenge your premise. You have provided no supportive credible link for your claims. The same holds true for your college meals claims.
Perhaps there is a possibility that a private company has employed folks who can figure out how to cut costs. That is great provided the cuts don’t undermine the government’s goals for the service.
But this possibility doesn’t address the logical fact that, everything else being equal, these same folks could accomplish a better result working for the government due to the absence of any requirement to pay investors for the use of their money (which necessarily reduces operating expenses by eliminating a major expense – return on investment for private investors.)
And I will agree with you that I am not as smart as you so you don’t need to remind our readers of that fact rather than simply explaining the error of my logic.
The Air Traffic Controller already have a union. Twenty-Seven percent of the ATC can retire and I’m guessing over 50% in five years. If they go private the controller start collecting their pension and keep working for the wages they earn right now. The main question to ask is would the new company force the ATC people to retire at age 56?? There’s about 2900 people that can retire right now and I’m guess their retirement will be at least $40,000 that totals $116,000,000 the government will pay a year and the they will pay for the same people to keep working at the high wage. If they retire the FAA hirers new employees at half the pay.
Bear,
I get the attraction of being an ideologue. You don’t have to gather information and do research, consider multiple thoughts or concepts, or think while all are necessary when one is curious and pursues knowledge and inderstanding.
While your response by jumping on MFI’s link proves my point because you are off the hook on thinking anymore, you still miss the point- if you don’t like prison meals as an example, why does the government contract out so much? Do you really think every government leader is so stupid (or corrupt) they can’t grasp your simple theory? A curious mind would investigate what they might be missing. But not an ideologue- “too much work and not necessary since my ideology is always right.”
By the way, teaching you basic economics is more than two paragraphs and requires curiosity and a desire to think.
Bottom line: Reforming the air traffic systems have been done in many countries. Granted you don’t really know how it has gone there (except as told to you here?), you are going to go with the Mayors of Edgemont, Wall, Sturgis, Mitchell, & Huron which don’t even have air traffic controllers.
I was just a pup when I figured out that when it comes to money, government is inherently inefficient while big business is ruthlessly efficient. Well, I’ll take government that is policed by a good press that keeps its owners [the voters] informed so that they can make good decisions as to that government over ruthless capitalism in most cases.
Now good ol capitalism is OK as long as you have a bunch of capitalists competing. That is, sadly, something there is very little of anymore in this country and something that would NOT occur with privatized air traffic control.
Privatizing it would be stupid IMO! Now that doesn’t mean that government might not be able to improve it.
To me it seems that Troy gives the usual Republican Knee jerk reaction: Government baaaad, privatization gooood……….
Another buck for the oligopoly’s.
Clyde,
I haven’t expressed a firm opinion on this matter but have said that (based on what I know) lean closer to the current arrangement than the plan submitted. With regard to provision of services (ala air traffic control or designing highway systems or providing law enforcement), I think the government should do what it can do well and not do what it can’t do well. I look at each item on a case by case basis without regard to ideology. Your statement is false. But, it appears by your statement you react by ideology and without real thought. Common here at DFP.
Troy, thank you for your response to my questions. Enjoy your day!
Canada and Great Britain seem to believe privatization is costing more and delivering less- just like prison meals. Why don’t you support your basic premises that stuff is just ducky when privatized? Or are you too busy being an ideologue?
https://www.nytimes.com/2016/02/15/opinion/dont-privatize-air-traffic-control.html?_r=0
NYT reports only two major nations have privatized ATC and neither are happy with the results. those two are Canada and Great Britain.
MFI,
Read the editorial. It doesn’t say GB and Canada are unhappy. In fact, the governments are happy and their taxpayers are happy. However, as Delta so poignantly points out in an article entitled “The cost of privatizing Air Traffic Control and HOW IT WILL AFFECT AIR TRAVELERS”, air travelers aren’t so happy because the cost of the Air Traffic System in Canada and Great Britain has been shifted from a heavy subsidy from the government to being substantially paid by air travelers.
I know you desperately want your ideology to be affirmed that the government is the answer to everything. Maybe you are the type who can’t deal with changing the status quo? Or maybe you like the idea of subsidizing the mostly wealthy and businesses who fly the most. However, none of those are compelling rationales in my mind. Got anything better?
mfi, I read the editorial and saw no statements asserting Canada and Britain “are happy and their taxpayers are happy” with privatization of their air traffic controllers. I did see this language in the editorial:
I found no language indicating either Country’s happiness about the increased costs of privatization.
Bear,
Well, did you find any language indicating they were unhappy as MFI asserted? Of course you didn’t. Are you really so blinded by your ideology you have no intellectual curiosity?
BTW, in addition to the Brits subsidizing the ATC system during post 9-11, they subsidized their airports and airlines. The taxpayers of the US did the exact same thing (airlines, airports and ATC). NYT needs to be better when it attempts to deceive by telling a half truth if they don’t want to be caught.
1) The Canadian privatization took place 20 years ago. There hasn’t been a single serious public demand for a reversion (grass-roots or elected leaders) whether the government was Conservative or Liberal run. If the government was “unhappy,” I’d think you could find a political effort to revert to government controlled and operated. But there is none. Is it reasonable to presume the lack of effort to make a change is an indication of some degree of happiness? Or should one presume unhappiness even if there is no evidence of unhappiness being expressed?
2) The Canadian Air Traffic Control system gets ZERO dollars from the government and is 100% funded by user fees. Are you asserting the taxpayers would be happy paying for it? Maybe I’m wrong but my guess is most taxpayers prefer users paying for services and not getting a subsidy from non-users. You think different?
http://fortune.com/2016/02/10/air-traffic-control-non-profit/
The Canadian system-in its entirety- handles about as much traffic as Cleveland. Cleveland is one of 22 systems in the US. None of the other nations with privatized ATC are as safe as the US.
Then you get into the lack of oversight by congress, deregulation of air traffic safety and eventually congress will need to get reinvolved to straighten out the mess.
bcb I never said either country was happy with the privatization. In fact it sounded like they were unhappy with the results.
In a real world how does one expect a non-profit to survive without profits? It ain’t going to happen. Wingnut ideologues want to hand over government programs to be privatized. That is the bottom line. Air traffic safety is just a sideline. The Hddson Institute of neocons thinks this is a grand idea.
High Airport Fees Discourage Competition
Canadian airports have some of the highest landing fees in the world, and altogether airport fees can be up to 200% higher than at US airports. These high fees can be felt on the ticket prices both directly and indirectly, as they discourage Canadian airlines from competing more aggressively for domestic routes.
With more profits to be made elsewhere, Canadian airlines often look to international routes when expanding. These high fees also discourage budget airlines from entering the Canadian market. So while it seems like a no-brainer for a new airline to start serving Canadian routes with such limited existing service, the reality is a bit different.
http://thehill.com/blogs/congress-blog/politics/318019-air-traffic-control-privatization-is-anything-but
Troy asks me many questions. Some he answers himself and some are rhetorical. Here goes:
An example of Troy asking and answering his own question. I wonder if he thought that I said I found such direct language when he read the part I quoted from the story?
I am not sure what ideology you believe I have, but I have attempted to exercise “intellectual curiosity” by asking you questions, which you have not answered.
It doesn’t seem reasonable to presume either happiness or unhappiness in either case. And whose happiness are you presuming? This evidence cited in mfi’s link (assuming it is accurate) – “air traffic control costs have increased more in Canada and Britain than in the United States since they privatized” would make some groups and government officials happy, some angry, and some indifferent.
I don’t see how the taxpayers would have to pay anything extra. If the program generates enough dollars to pay for its operation, then how would that change if the program were run exclusively by government employees, rather than contracted out to a private company to run? What would the taxpayers have to pay for?
That would depend on what the user was using. For example, if the user was using the police to stop a crime I suspect most taxpayers would be happy to subsidize the costs of law enforcement. Likewise, many taxpayers would think using tax dollars to prevent mass deaths in airplane crashes would be a useful thing to subsidize if necessary.
On the other hand, worrying about how one’s particular taxes are being spent is a fool’s errand. It make sense to support or oppose particular public choices for the expenditure of tax dollars, but it makes no sense to assume one’s particular tax dollars is funding something he objects to rather than funding something he supports.
mfi, I agree with both of your statements:
On the other hand, I think I can answer your question:
A non-profit only needs to generate sufficient revenue to pay the costs of running the program; there is no need to earn profits or pay dividends to shareholders or owners. And under SD state law if a non-profit accumulates income or property above and beyond its financial operational needs, that extra money reverts to the state, rather than private individuals, if the non-profit closes its doors.
http://thehill.com/special-reports/269046-the-devolution-of-aviation-safety
Taxpayers of Canada and Britain lost bigtime with privatized services.
Thanks for that, Bear. I have a tough time figuring out if the head honchos get paid or not in a true non-profit. They claim the employees in Canada get paid well.
Way above and beyond my pay grade.
I don’t recall being nearly and often run down by USPS mail wo/men, but UPS, FEDEX, ect. scare nearly every time encountered. point: safety is best not privatized. profit hospitals, correctional facilities, perhaps public transportation, seem to have some or serious profit-corrupted problems. & medical insurance, and especially banking/investment, too, social security ect.
Castrating EPA, until privatized too, “Pruitt has drawn heavily from the staff of his friend and fellow Oklahoma Republican, Senator James Inhofe’s (82, R.), (Congress’s most prominent skeptic of climate science) chief of staff Ryan Jackson;
1.) will be Mr. Pruitt’s chief of staff.
2.) Another former Inhofe staff member, Byron Brown, will serve as Mr. Jackson’s deputy.
3.) Andrew Wheeler, a fossil fuel lobbyist and a former Inhofe chief of staff, is a finalist to be Mr. Pruitt’s deputy, requires confirmation by the Senate.
4.) Trump campaigner, Don Benton, former Washington senator who headed President Trump’s state campaign will be the agency’s senior liaison with the White House.
5.) Douglas Ericksen, another Republican Washington state senator will be regional administrator of E.P.A.’s Pacific Northwest office.
6.) Ericksen, active in opposing state-level climate change law taxing carbon pollution, invited Tony Heller, climate denialist blogger (pseudonym Steven Goddard), to a Washington State Senate committee on the costs of climate change policy. Heller’s blog says “global warming is the biggest fraud in science history.”
7.) David Kreutzer, senior research fellow in energy economics and climate change at Heritage Foundation will serve under Pruitt and has praised the benefits of increasing carbon dioxide in the atmosphere.
8.) Pruitt begins the process dismantling Obama-era regulation over rivers, streams and wetlands to prevent water pollution.
9.) Pruitt is walking back collection of data on methane emissions from oil and gas wells.
10.) Pruitt to begin the legal process of unwinding Mr. Obama’s E.P.A. regulations aimed at curbing planet-warming pollution from coal-fired power plants
10.) Pruitt will slash the E.P.A. budget by about 24 percent, or $2 billion from its current level of $8.1 billion.
11.) Employee numbers will be cut 20 percent from current staff of 15,000.
12.) After working for years to draft climate change regulations under the Obama administration, many career scientists and lawyers will be ordered to go back and undo them.
13.) Pruitt’s may not be long-lived. There is speculation that his eyes on a different office.
14.) Inhofe, 82, will complete term in 2020. Inhofe said Pruitt, “I think he’d make a great senator.”
15.) Agency employee morale has been damaged.
https://www.nytimes.com/2017/03/07/us/politics/scott-pruitt-environmental-protection-agency.html?hp&action=click&pgtype=Homepage&clickSource=story-heading&module=first-column-region®ion=top-news&WT.nav=top-news&_r=0
:)