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Trump Plans To Privatize Air Traffic Control

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On Monday, President Donald Trump announced plans to privatize air traffic control in the U.S. Labeling the existing system as “antiquated” and “horrible” he promises modernization through a private non-profit organization co-owned by the largest and most important players in the air transport industry.

Former Transportation Secretaries have already praised Trump’s initiative. Among others, former Secretary Ray LaHood (2009-2013) said:

I applaud President Trump for his leadership in putting forth a bold plan and vision for moving ATC out of FAA and creating a more efficient and effective Air Traffic Control. This will enable the quicker and smoother implementation of Nexgen technology.

The technology LaHood refers to is a transition from audio based flight control to a text based computerized system. The FAA explains the technology in the video below.

 

Not everyone approves of the plan, however. According to the Guardian:

Democrats poured scorn on the start of what has been billed as “infrastructure week,” arguing that Trump’s plans will mean less construction and fewer jobs, particularly in rural areas, while financiers profit from tolls.

These criticisms may have truth to them because any increase in efficiency must necessarily mean fewer jobs in that field. However, the increased efficiency will spill over into other areas in the form of lower prices and more jobs. This is what the famous economist Schumpeter called “creative destruction” – the free market destroys some jobs to make the economy better and more robust for all through innovation.

Some pundits seem to have completely missed this point:

Some analysts find aviation a curious choice for the kick-off of Trump’s infrastructure push. There has not been a fatal crash of a domestic airliner in the US for eight years. But it may represent low-hanging fruit, since a bill authored by House transportation and infrastructure committee chairman Bill Shuster has already laid the groundwork.

As described in FAA’s video, the purpose of innovation in air traffic control is not primarily to avoid crashes but to alleviate congestion in the air. Delays are increasing, and improved traffic control can help resolve the issue.

Another significant source of increased delays and passenger impositions, however, is the TSA’s draconian security checks in recent years, which is not addressed by the new plans put forth by the Trump administration. There is no evidence that the TSA provides effective security, and according to a poll conducted by Kenton Global, more than one-third of passengers list waiting in lines as their chief complaint and source of frustration at airports. The airline industry has long been frustrated by the wasteful and pointless security checks, and as early as 2011 they proposed a tiered risk system for reducing the hassles of security. Their solution is to divide passengers into three categories, allowing low-risk frequent flyers to enter the terminal without security checks, and a more stringent security check for high-risk passengers.

So far any such proposal has been quickly shot down under the guise that it would be racist to discriminate passengers based on profiles. It will be interesting to see if Trump has the audacity to follow the recommendations of the airline industry in this matter as well.

Although Trump’s privatization plan does not go as far as many freedom lovers would like, it does signal a willingness to deregulate and foster innovation. This propensity is turning out to be one of Trump’s defining proclivities that distinguish him from previous presidents. It may reflect the fact that Trump as a lifelong businessman has developed an intimate understanding of the destructive and costliness of bad regulations.

With more deregulations in the air industry, we may perhaps even see other novelties such as the Endless Runway proposed by European innovators.

Anyway you look at it air travel is in for a world of changes – so hang on to your seat belt.

For those interested, here is a video by Wendover Productions which breaks down the cost of flying, showing that taxes and airport fees make up the bulk of the ticket price.

 

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