December 17, 2023 — Air travel is soaring, as a long-term trend, especially in the growing economy. It is also soaring seasonally: The few days after Christmas are expected to be especially intense. Many passengers will experience maddening flight delays this holiday season, especially in the US. A few might be exposed to scary airport near-misses. It is reasonable to hope that the excellent US safety record — no fatal crashes since 2009 — will be extended. But close calls have increased during the post-pandemic return to commercial air travel, reaching about 300 in the most recent year, 27 of them serious.
- The strain on the Air Traffic Control system
These troubles in American skies are in part attributable to severe overstraining of the air traffic control (ATC) system. To begin with, there aren’t enough qualified air traffic controllers. The National Air Traffic Controllers Association says there are 1,000 fewer working today than a decade ago, despite the increase in air travel. This translates into an estimated shortage of about 3,000 controllers [that is, 14,500 at full strength minus a current staff of 11,500]. As a result, those in the control towers chronically work overtime. Six-day workweeks are common. They are, reportedly, often exhausted.
Worsening the situation, the equipment that the controllers use is very outdated. At a time of great technological progress in computing and satellite-based telecommunications, the controllers must rely on the same sort of ground-based radar and analog radio communication as they did in the 1950s. Many controllers are said still to use paper strips to keep track of planes. The results include unnecessarily high costs and an unpleasant flying experience.
The ATC system is not sufficiently well-funded. The function resides within the Federal Aviation Administration (FAA), which is also responsible for regulating air safety. As a result, ATC planning can’t rely on the sort of stable multi-year funding that it would need to be able to invest in appropriate modern equipment and to hire and train the controllers it needs.
Currently the FAA is training barely enough new controllers to keep up with the ones who are aging out (required at age 56) or choosing to retire (as many do at 50), let alone to make up the existing shortfall. Worse, it needs to keep up with long-term growth in air travel. It takes three years to hire and train a controller. Thus, the FAA needs to increase sharply the number in the pipeline, to catch up with normal levels within a reasonable time frame.
The undependability of FAA funding is more than a notional concern. Congressional Republicans have repeatedly threatened to cut appropriations, as a component of their demands to reduce the US fiscal deficit exclusively by cutting non-defense discretionary spending. In 2018-19, for example, a government shutdown ruptured the FAA pipeline of new controllers by suspending the academy in Oklahoma City where they are trained. Another government shutdown is on the calendar for February.
The problems go beyond funding, however. Another factor that contributes to airport congestion, flight delays, cancellations, and near-misses, is the over-allocation of scarce ATC resources to corporate jets, at the expense of commercial planes.
- How to fix the malfunction
The solution to these problems is to move the air traffic control function outside the FAA, and to replace congressional appropriations with user fees paid directly by ATC customers. This is the “public utility” model. Freed from dependence on Congress, the ATC organization could hire a generation of controllers and invest in modern technology.
In the 1990s, the Clinton Administration tried unsuccessfully to spin off ATC to an independent government corporation funded by user fees. At the time, only a few other countries had “corporatized” ATC. Since then, some 60 countries have done so, with favorable results. For example, Australia, Canada, Germany, Great Britain, and New Zealand, have privatized their air traffic control systems. Experts consider the most successful model to be NAV Canada, which was established in 1996 as a private non‐profit corporation, operated by the ATC users and other stakeholders.
Giving a private corporation responsibility for a matter as delicate as air traffic control may at first sound reckless. But this is wrong. ATC is not an inherently governmental function. Like the production of Boeing aircraft or the business of the airlines that fly them, the operation of the ATC system can be performed safely by a commercial entity as long as it is subject to FAA safety regulation. In fact, the current arrangement, in which the FAA both operates and regulates ATC, represents a conflict of interest — one that the International Civil Aviation Organization directs countries to avoid.
- Why the delay?
Independent experts have long agreed on the diagnosis of the problem. They range from libertarians at the Reason Foundation and the Cato Institute, to Nobel Prize winner Joe Stiglitz and Dorothy Robyn, who worked on Clinton’s effort to corporatize ATC. Elaine Chao, former Secretary of Transportation in the Trump administration, has also made the case for ATC reform.
Why, then, haven’t proposals to move the ATC system out of the FAA been adopted? One major obstacle is simply stated: the political power of the tiny elite who use corporate jets. The private-jet-set is small in number but large in wealth and influence, with an effective lobbying operation. Their priority is to retain cheap access to airports. They have blocked reform in Congress, most recently in 2017.
Funding for ATC would not be quite so problematic if all planes paid their fair share. Currently, the system heavily subsidizes corporate jets at the expense of the general traveling public, via the substantial taxes and fees that we all pay as passengers. The rapidly growing fleet of private jets contributes only 2 percent of the tax revenue on which the FAA depends, even though they constitute about one sixth of the flights handled. The effective subsidy has been estimated at $1 billion a year. If the ATC organization were made answerable to the air-going public, rather than to Congress, business jets would be asked to pay their way. The frequency of airport takeoffs and landings by smaller planes would go down, reducing congestion, the strain on air traffic controllers, and stress for the beleaguered flying public.
Corporate planes are further subsidized by tax deductibility. Meanwhile, they contribute a disproportionate share of carbon emissions — as much as 14 times as much per passenger as commercial flights in the UK.
The solution is to give the ATC system more of an incentive to respond to the needs of the airlines, which in turn respond to the needs of the air traveling citizenry as reflected in their willingness to buy tickets. It should be given correspondingly less of an incentive to respond to the desires of the corporate airplane lobby, as reflected in its ability to influence Congress, which is currently the year-to-year dispenser of taxpayer funds for ATC.
The general story of small but powerful lobbies in Washington is familiar in the abstract. The traveling public’s experiences with long flying times, flight delays, cancellations, and near-misses are familiar in the concrete. If only the voting public understood the causal link between the two, perhaps Congress would be motivated to act.
[A shorter version appeared in Project Syndicate.
Comments can be posted at Econbrowser. Thanks for comments are due Dorothy Robyn and Sohaib Nasim.]