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Commercial Aviation: Looking for a Tail Wind

Security Aside, Airlines Say a Decade of Regulations Has Slowed Them

Even before the explosions of American Airlines Flight 11 and United Airlines Flight 175 had collapsed the twin towers of the World Trade Center — and before either American 77 had roared into the Pentagon or United 93 had crashed in a Pennsylvania field — the 19 al Qaeda hijackers on those planes had started changing the future of American transportation.

The limiting of takeoffs across much of the Northeast imposed soon after 9 a.m. on Sept. 11 was expanded in less than an hour to a total shutdown of United States airspace, the first unplanned stoppage of all civilian flights ever ordered by the Federal Aviation Administration. The national ground stop lasted three more days — a disruption that, when combined with a suddenly intense national anxiety about flying, threatened the very viability of the U.S. airline industry, which at the time was responsible for about 10 percent of the gross domestic product.

Within two weeks, Congress had responded to the airlines’ plea  for an economic lifeline by delivering a $15 billion infusion of cash.  Within two months, it had dictated that the federal government take control of all airline and airport security. The industry was given no real choice in the matter.

Over the next months and years, 50,000 government-employee security screeners took over from private contractors at airport checkpoints, air marshals began flying undercover on hundreds of flights every day, steel guard bars were welded onto thousands of cockpit doors, a newly created Transportation Security Administration filled airport lobbies with bulky machinery to scan passengers and look inside their baggage — and millions and millions of pieces of personal information gathered by airlines about their customers were made available to a rapidly expanding intelligence community.

The costs were partially covered by higher ticket taxes, but Congress also appropriated sums that would have been unimaginable on Sept. 10, 2001. Right after the attacks, Congress provided $11 billion for domestic anti-terrorism measures, which would henceforth be called “homeland security.” That was a more than 70 percent increase over previous spending levels. By 2004, overall homeland security spending would reach $40 billion a year.

A decade later, the massive government security cloak thrown over American aviation causes plenty of grumbling about logistical inconveniences and invasions of personal space. But it has largely eased apprehension about the safety of the skies, because there has been no other successful terrorist attack involving the airlines (though shoe bomber Richard Reid got close in December 2001, and underwear bomber Umar Farouk Abdulmutallab likewise came close eight years later.)

But that initial shutdown of the nation’s airspace and the subsequently slow recovery — the number of total passengers last year was only slightly higher than in the year before the attacks — continues to leave the industry in economic turmoil. Forty-one airlines have gone bankrupt in the past decade, 160,000 jobs have vanished, and the industry has amassed $54 billion in red ink. Airlines have been buffeted by rising fuel costs — and by an increasingly high level of regulation, especially for an industry that was officially deregulated in 1978. (Airlines are required to report a vast array of data to the FAA, on everything from unruly passengers to customer complaints.)

“We appear to me to be on a course that plots from a disparate and often-conflicting confluence of conditions — from wanton neglect or lack of focus at best, to over-exacting scrutiny and being a whipping boy at worst,” Nicholas Calio, president of the Air Transport Association, the airlines’ trade group, said at a recent aviation conference. “We can continue the course we are on as an economy and a country and suffer the consequences. Or we can take practical, positive steps, based on what is actually, in my view, the urgency and opportunity of this inflection point, and regain the competitive position that this industry and our country once enjoyed as a leader in global aviation.”

Pushing the Reset Button

Calio and others in the industry are looking to reset their relationship with the federal government now that a decade has passed since the deadliest day in American aviation history.

It took much of those 10 years to get the basic security system into place in a way that both blocks terrorists and keeps passengers moving quickly.

For example, the minivan-sized baggage screening machines that the government plopped down in the middle of airport lobbies have now — at airline and airport officials’ urging — been incorporated into behind-the-scenes baggage checking systems. That makes the process much faster for passengers and frees up valuable real estate in airport lobbies.

Christopher Bidwell, vice president for security and facilitation at the Airports Council International, says government and industry have learned how to work well together on security matters. “Since the early days after 9/11, there’s been a sea change,” he said.

Both airlines and airports are now looking for the government to step back from its deep involvement in non-security affairs. The industry is pushing for less regulation of its finances, services and internal operations. Airline officials also say that the taxes the industry pays — which tripled to $17 billion in the past decade — are too high given the collective 2 percent profit margin of $3 billion the airlines garnered last year. Airport officials say they need the government to relax its rules on financing so they can attract more non-federal dollars for airport projects.

On the brighter side, the FAA is forecasting that the airlines will carry at least one billion passengers every year by 2021, up from nearly 800 million last year. But industry officials say that projected growth means the government will also have to revise its security strategy. “If we take what we have now, and throw in 250 million-odd more passengers, it’s not sustainable,” Bidwell said.

Looking to the Future

Since the 1960s, when a spate of hijackings first prompted the airlines to begin patting down their customers, security at airports has focused on keeping dangerous objects — guns, knives, explosives and other weapons — off of planes.

The hardware-based security system remains in place today, updated to reflect the terrorist threats that have been revealed since Sept. 11. Now ointments, pastes and liquids are all viewed with suspicion, because they could be laced with explosives or poisons that a terrorist could use to kill passengers or pilots. The possibility that a packet of plastic explosives has been hidden in a boot heel, taped inside a bra or secreted in a body cavity means that the TSA wants to cast its eyes on every part of every passenger. And that takes a long time. The more objects that go on the look-for list, the longer each screening takes, the longer the lines get at the checkpoints — and the more frustrated consumers become at paying top dollar for a trip that’s sometimes only marginally faster, and much more hassle-filled, than going by car or bus or train.

The aviation industry worries that the system could become unbearably slow as the number of passengers grows over the coming decade. It is urging the government to move toward what they call a threat-based or identity-based system, one that does not subject all passengers to the same lengthy screening procedures.

Under an identity-based system, the industry and the government would develop expedited screening processes for passengers who have submitted background information in advance. Bidwell, the airports official, says some of the data for an identity-based system is already collected by the government, such as the paperwork passengers submit to customs agents when they travel from abroad. That kind of pre-screening of the vast majority of passengers who pose no security threat would allow the government to focus its efforts on people whom the government doesn’t know much about.

The TSA is heeding the industry’s calls. It has begun developing identity-based systems, including one that will allow pilots and flight crews to move through security more quickly. Administrator John Pistole says the government recognizes that most passengers are not threats. “We should screen smarter, and appropriately focus on those who do present the greatest risk, thereby improving security and the travel experience for everyone else,” he said at a recent conference.

While the government has been responding to industry’s calls for a new approach to security, federal officials have so far not heeded the push to reduce regulations and taxes. Indeed, congressional leaders have been considering raising aviation taxes to help address the budget deficit. Industry officials launched a lobbying blitz last month when word of the tax proposal leaked out of White House negotiations on a deficit reduction package.

“This is absolutely unacceptable,” Calio said. “We should advance a tax policy that encourages air service to grow, not contract.”

Regardless of the outcome of that fight, the message from the government was clear. The deeply intertwined relationship of the government and the aviation industry has only deepened in the past decade, and it’s likely to remain tight in the next one.

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