[lbo-talk] blackouts and deregulation

Jordan Hayes jmhayes at j-o-r-d-a-n.com
Tue Aug 19 09:23:25 PDT 2003


Doug Henwood writes:


> So very American - let's just focus on the successes
> and just ignore the carnage to the side.

So it's "un-American" to focus on the failures and just ignore the successes to the side?


> How many of these new airlines have sprouted up only to
> disappear after a year or three?

It's true: there's no sure-fire formula for building an airline and making it work. Richard Branson says he knows how to become a millionaire: start by being a billionare and buy an airline. But Southwest has been around for 30 years; and isn't it better for unprofitable airlines to disappear and get out of the way? Look at the pain UAL is going through; they should have just closed up shop a long time ago.

Ok, but what about the jobs? Is there some magic that is supposed to occur when there's an imbalance between what people will pay for a product/service and what someone has decided is a "good job" ...? Didn't the auto industry go through this a while back (and steel before them?).


> From the passengers' point of view, the fare structure is
> completely insane - fares on similar flights can vary by
> 100% or more

How could it be otherwise? Are you calling for some kind of flat-rate pricing that would punish airline managers who can control costs and be profitable while providing uality service? I, for one, am a big fan of "insane" fare structures if it means that in the ensuing chaos there are full planes of leisure travellers on deeply discounted tickets.

What's "insane" is the cost structure of these airlines.


> That's mainly because of quality decreases - tighter
> advance purchase restrictions and one- and two-stop
> flights replacing nonstops.

Sure, it'd be nice if the route structure was all point-to-point and walk-up fares were cheap. What world are you living in?

/jordan



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