FAA shutdown to cost US

[JSCL]

Didn't see this anywhere yet for some reason.

FAA in partial shutdown and set to cost US $1bn in lost taxes.

BBC News - FAA shutdown could cost US $1bn (£610m) in lost taxes

[maxred]

You are beginning to really wonder about all of this. If wholly accurate, you honestly could not make it up

[rotornut]

The United States of Africa

[kinteafrokunta]

Without going into a long story about the recent theatrics in Washington DC, it's all because American wants to see a black president fail. They will do all they can to make him a one term president, even if it bring the whole of USA down on it's knees. All collateral damage?

[11Fan]

My God, if that's true, how on earth did he get elected?

[Ditchdigger]

Without going into a long story about the recent theatrics in Washington DC, it's all because American wants to see a black president fail. They will do all they can to make him a one term president, even if it bring the whole of USA down on it's knees. All collateral damage?

First and foremost, it's not all of America that wants to see President Obama fail, but those that do, want very badly for him to fail.

While there may be a racial component to some of this, it would be more accurate to say that America's Republican Party would like to see the President, a member of the Democratic Party, fail. The fact that the President is black is, at most, secondary to partisan politics and ideology.

Reference the partial shutdown of the FAA, it's political gamesmanship. many have referred to it as "hostage taking". In a nutshell, Republican Congressman John Mica, Chairman of the Transportation Committee has crafted the reauthorization bill in such a manner as to make it unpalatable to Democrats, by including a number of provisions to advance his own agenda.

Many of you may be familar with Don Brown, who used to write about safety for AvWeb. He now has a personal blog, "Get the Flick", and he frequently writes about these issues.

One recent entry on the subject: http://gettheflick.********.com/2011...from-mica.html

(Discovered on post preview: Hmmm. PPrune software apparently auto-censors a portion of that link. A working link can be found on R Doug Wicker's blog, linked below.)

Probably not as well known, several other bloggers have recently posted on this situation as well. Here is one:

Further Down the Rabbit Hole | Martinlady's View Through the Looking Glass

This one, by R. Doug Wicker explains the situation in pretty minute detail:

Can This Economy Take a 90,000-Job Hit? | R. Doug Wicker

I hope that provides some insight....

[SASless]

Errrrr.....I am led to believe the Union Vote issue is contained within a separate Bill which could be ignored while a procedural vote called "Unamimous Consent" to authorize a temporary passage of the FAA Bill would fully fund the FAA for up to Ninety Days. Both the Senate and House are still "In Session" so as to prevent any Recess Appointments by Obama.

The Union Leaders are trying to end a Seventy-Six practice of having a Secret Ballot for organizing a Union within a business or government agency. Thus far the workers wanting the Union had to win a two thirds majority of all votes possible. They now want to do away with the secret vote and go for a simple majority of votes cast.

The Democrats of course are all for that as a vast amount of Union Dues finds it way back to the Democratic Party in the form of campaign contributions.

The other thing to recall is the Senate passed the Bill which was sent to the House which returned it to the Senate for a final vote. In simple terms....the Democrats have voted for it already in the past.....just are refusing to do it now.

Some of these passenger subsidies amount to as much as $3700 per passenger.....with some load factors for last year being 0.6 passengers per flight. Is that money we need to be spending now?

The National Debt is now just over 100% of GDP......and growing daily!

At least throw some facts into the argument folks!

[Ditchdigger]

Errrrr.....I am led to believe the Union Vote issue is contained within a separate Bill which could be ignored while a procedural vote called "Unamimous Consent" to authorize a temporary passage of the FAA Bill would fully fund the FAA for up to Ninety Days. Both the Senate and House are still "In Session" so as to prevent any Recess Appointments by Obama.

The Union Leaders are trying to end a Seventy-Six practice of having a Secret Ballot for organizing a Union within a business or government agency. Thus far the workers wanting the Union had to win a two thirds majority of all votes possible. They now want to do away with the secret vote and go for a simple majority of votes cast.

If you can cite a source for that, I'll be happy to read it. Everything I've read, in the links above and elsewhere, leads me to believe that those provisions are attached to the reauthoization bill itself, that the House has already gone home for vacation, and that the issue with union voting is that the practice you describe above has already been overturned by the NMB, and the attached provision would bring it back.

The Democrats of course are all for that as a vast amount of Union Dues finds it way back to the Democratic Party in the form of campaign contributions.

And a vast amount of corporate money finds its way into Republican coffers. So what's your point?

Besides which, that makes the motivation for the Republican anti-union agenda all the more transparent, doesn't it?

[Ditchdigger]

I have to wonder whether Don Brown read this thread and then sat down at his keyboard...

Since one apparently can't post a link to Don's blog directly from here, Let me google that for you

[westhawk]

Nice work Ditchdigger! (Apparently Judge Smails was right.)

I am a longtime Brown fan and appreciate the "not a link" to his blog.

[con-pilot]

Besides which, that makes the motivation for the Republican anti-union agenda all the more transparent, doesn't it?

But the Democrat's pro-union agenda of outlawing the secret ballot is okay and that's not transparent?

Not to mention not being very democratic.

Besides that, they go back to work Monday and will be reimbursed for the lost wages.

And while we are on the subject, just where was all this concern by the Democrats about people losing their jobs or being laid off when nearly a hundred thousand workers lost their jobs when Obama shut down all drilling in the Gulf of Mexico?

[westhawk]

Getting into jet blast territory, but here goes anyway.

Politicians are cheats and liars. All of 'em!

I guess the present deal only carries FAA authorization through to mid-September, but is better than nothing. They've been operating like this for 4 years now. I wonder how much longer. Both political parties have reached deeply into their dirty tricks bags and I don't see this stopping anytime soon. I wish they could find a different battlefield, but this is the one they've chosen.

With a gridlocked congress and a pres who doesn't seem to like aviation much, (except enjoying the exclusive use of the priciest bizjet in the world at taxpayers expense!) the FAA seems to be less important to the powers that be than winning a political pissing contest. Both parties are guilty of behaving like ill-mannered children and I wish we could just knock their heads together and stamp their meal cards NO DESERT.

But things are what they are. Be careful up there...

[Ditchdigger]

Originally Posted by westhawk

....the FAA seems to be less important to the powers that be than winning a political pissing contest.

Well, when you consider that they were willing to put the entire economy in jeopardy over the debt ceiling, the FAA is really just a sideshow, isn't it?

But back to the prior post...

Originally Posted by con-pilot

But the Democrat's pro-union agenda of outlawing the secret ballot is okay and that's not transparent?

Not to mention not being very democratic.

It seems to me that democracy is a participatory sport. You show up and cast your vote, and if you don't bother to show up, your opinion doesn't count. You essentially defer your wishes to those who've bothered to participate.

The practice in question, that of counting non-voters on one side or the other is what's distinctly un-democratic.

(Sure, in this case it's counting non-votes as "no" votes on the union question, but how much would you like to bet that the Republicans and big businesss would be fighting against that proposition if the shoe were on the other foot--if those non-votes were to be counted as a "yes"?)

Originally Posted by westhawk

Politicians are cheats and liars. All of 'em!

Pretty much.

But, while it's self apparent that hurting labor unions would inhibit their ability to buy politicians, I don't think anybody is delusional enough to think that helping big labor would in any way reduce the ability of big business to buy politicians.

Originally Posted by con-pilot

And while we are on the subject, just where was all this concern by the Democrats about people losing their jobs or being laid off when nearly a hundred thousand workers lost their jobs when Obama shut down all drilling in the Gulf of Mexico?

Oh, you mean when he did that in the middle of the worst environmental disaster in the history of America? Yeah, that didn't make him many friends, did it? I'll bet it got the attention of big oil though.

But really, it's an apples and oranges comparison. Mica's action was equal to throwing a monkey wrench into a specific part of the government machinery, to further his idealogical agenda, without regard for the consequences to the function of that machinery. The furloughs, and layoffs of the construction people, were collateral damage, but wholly predictable, as was the lost tax revenue. Isn't it a Congressman's job to make the machinery of government work, not screw it up?

On edit: Just wanted to add one more thought--For the airlines to raise their fares to match the un-charged tax, was to symbolically spit in the face of both their customers and the taxpayers. Disgusting...

[galaxy flyer]

First, the FAA shutdown did NOT cost the US a dime--US citizens and US airlines just didn't collect the tax, so it remained in the economy, not in the government's hands to waste.

EAS is a silly, wasteful program that subsidizes air service to communities that do not justify air service except when it is politically expedient.

WRT, the NMB has run union elections for decades without the interference of political masters who are answering to the their paymasters--organized labor. Suddenly, they change the rules after the previous election rules resulted in the most unionized industry in the US. This, and the Boeing/SC case, is just another example of this administration's role in this weak "recovery".

Ditchdigger

That the airlines could "pocket" the taxes and not pass on the difference in price to the consumer says more about the short-term elasticity of demand than airline management "spitting" at the consumer. It appears that, in the short term, tickets are pretty inelastic and, when you think of it, that makes sense--are you going to not buy a ticket, if you don't get the tax back. You were ready to buy the ticket with the tax.

GF

[Ditchdigger]

First, the FAA shutdown did NOT cost the US a dime--US citizens and US airlines just didn't collect the tax, so it remained in the economy, not in the government's hands to waste.

That's only a 100% valid statement if one accepts it as a given that any money that gets into the government's hands is wasted. I'll grant you that there is waste in government, but you'll have to grant me that it also does provide many essential services that no other entity does, or would.

I think just about everybody would agree too, that government spending and government revenue are not really related in any meaningful way. That's part of what the whole debt ceiling game was about. So, here, we have an action by a Congressman that just took $30 million/day in revenue, and moved it from the government's bottom line to the airlines' bottom line. Who benefits from that?

That the airlines could "pocket" the taxes and not pass on the difference in price to the consumer says more about the short-term elasticity of demand than airline management "spitting" at the consumer. It appears that, in the short term, tickets are pretty inelastic and, when you think of it, that makes sense--are you going to not buy a ticket, if you don't get the tax back. You were ready to buy the ticket with the tax.

Inelastic? From what I've seen, ticket prices must be made out of Silly Putty. I'd be surprised to learn that any two seats on a given flight sold for the same price. (Yeah, that was hyperbole, but you get my point.)

The elimination of the tax didn't change their costs any, and they had been willing to sell the tickets at the lower price. So, sure, they raised their prices, because they could. Do you think that's the sort of behavior that's designed to inspire a warm fuzzy feeling in their customers?

[galaxy flyer]

Yes, the Federal Government does provide essential services, but they are so far beyond "essential" as to be ridiculous. Is sponsoring Cowboy Poets Recitals essential service?

If revenue and spending are disconnected, as you say, why is there any argument about--just let the Feds spend $10, 20, or 30 trillion each year. We cannot spend what we do not produce--Say's Law.

The EAS program is a prime example of wasteful spending, fares subsidized in multiples of the face value of the fare. There isn't any "normal" service at, say Ely, NV because there isn't a demand for it, taking it away from Harry "Pomegranate" Reid is just icing on the cake.

In fact, your comment on Silly Putty fare structure is an example of the price elasticity of tickets. For those who really need to be there, put a much higher value on the trip or the time spent traveling, pay more. For those for whom the travel is optional are charged just enough to induce them to part with the money. The factor that drove the airlines to price the way they did is that the supply of airline seats is inelastic over the time frame in this situation. The airlines couldn't add seats, thus letting the 7.5% go to the passengers due to the airlines competing for them with additional supply. So, they could raise fares, by 7.5%, and reap a revenue windfall, due to Congress. ECON 101

Regarding the "transfer" of $30 million/day, it isn't a transfer in any meaningful sense of the word. Congress didn't renew the law, giving up the revenue. The market between airlines and passengers decided who got it. Congress did not transfer the money to anybody. Had an airline priced their tickets ex-taxes and buyers flocked to that airline (read: SWA, perhaps), the industry would NOT have raised their fares and passengers would have benefited.

GF

[Ditchdigger]

The EAS program is a prime example of wasteful spending, fares subsidized in multiples of the face value of the fare. There isn't any "normal" service at, say Ely, NV because there isn't a demand for it, taking it away from Harry "Pomegranate" Reid is just icing on the cake.

If you followed the link I posted above, you'd have read:

Originally Posted by Don Brown, in Get the Flick

You see, Mica intentionally set out to anger Senate Democrats over this issue. He did it by choosing an unrelated issue, one that is hard to understand and difficult to defend. You can understand it (people in rural places need access to air transportation too, just like roads) and it can be defended. It just takes more time than the average American’s attention span or your average news segment. Fortunately for me, my readers aren’t average......


........Mica, being the clever weasel that he is, gave himself an issue that is easy to “sound bite” and has nothing to do with the issue at hand. In other words, unless you have as much time to read as I do and some inside knowledge about the industry, you’ll never understand what is going on. If you wanted to be kind and reasonable, you might say Chairman Mica has obscured the issue. I don’t feel like being kind or reasonable with Chairman Mica so I’ll tell you flat out he is being deceitful.

(Bold added)

(And I'll also add that which you've probably already figured out; I have great respect for Mr. Brown's insights.)

And indeed, Reid gave in on the EAS, and the Agency is up and running again. Of course, the "issue at hand" that Don Brown refers to is the union issue. The EAS issue, example of waste or not, was a smokescreen for Mica's real interest.

If revenue and spending are disconnected, as you say, why is there any argument about--just let the Feds spend $10, 20, or 30 trillion each year. We cannot spend what we do not produce--Say's Law.

Sure we can. We've been doing it for years. That's why we're in debt. And debt is what the Republicans are screaming about.

The point is that now, there's $388 million that didn't go towards revenue, which otherwise would have. That isn't going to help make the hole any shallower, is it?

Regarding the "transfer" of $30 million/day, it isn't a transfer in any meaningful sense of the word. Congress didn't renew the law, giving up the revenue. The market between airlines and passengers decided who got it. Congress did not transfer the money to anybody.

Had Congress done what Congress is supposed to do; what the taxpayers pay Congress to do; and kept the agency fully functional, the money would be in the taxpayers' bank account, not the airlines' bank accounts.

That seems pretty meaningful to me, and a pretty straightforward example of cause and effect.

So, they could raise fares, by 7.5%, and reap a revenue windfall, due to Congress.

Yeah. What you said.

And what I said. They raised the fares because they could.

You can argue economics all you want. I'm talking about customer perceptions. I'm a very infrequent airline customer, but it left a bad taste in my mouth.

Had an airline priced their tickets ex-taxes and buyers flocked to that airline (read: SWA, perhaps), the industry would NOT have raised their fares and passengers would have benefited.

Well, I guess we'll never know. I'd assume many travel plans were made in advance. I wonder if there would have been a quantifiable difference between airlines if this had gone on until September?

Is sponsoring Cowboy Poets Recitals essential service?

Wow. Now that I've heard of it, I feel my life is incomplete...

[GetTheFlick]

All I want to know is why you can't link to my blog? (I used to know but I've forgotten.)

Thanks for the plug anyway, Ditchdigger. Nice to see you too Westhawk. Thanks for the kind words.

I see Con and Galaxy are still trying to sell the same old snake oil. Keep at it boys. Your Confederate dollars will be worth a lot of money one day.

Were our enemies right?

Don Brown
Get the Flick

[Ditchdigger]

All I want to know is why you can't link to my blog? (I used to know but I've forgotten.)

The forum auto-censor feature seems to include the term "b l o g s p o t" on its list of no-nos. I guess it's a dirty word. Oh, ******** !

Thanks for the plug anyway, Ditchdigger. Nice to see you too Westhawk. Thanks for the kind words.

My pleasure, sir. You state the case on these issues much more eloquently than I can, and you're much more fully informed.

[GetTheFlick]

My pleasure, sir. You state the case on these issues much more eloquently than I can, and you're much more fully informed.

Is that code for "I'm retired and got nothing better to do than read all day" ?

Don Brown
Get the Flick