deregulation

Another BAD Nomination

by: ProgressiveMews

Sun Sep 20, 2009 at 00:02

My letter sent to the White House, in response to David Corn's article; is now also an open letter, here and elsewhere.

Mr. President, with all due respect, HOW COULD YOU?  

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Demos Reports: Airline Deregulation Isn't Good For You. Thoughts On Transportation & Freedom Ensue

by: Paul Rosenberg

Sat Jun 27, 2009 at 08:00

Warning: Don't let the beginning of this diary fool you.  It's actually about hegemony & the liberal vs. conservative view of "freedom".

Demos has a new report out, Flying Blind: Airline Deregulation Reconsidered, and what do you know?  Surpise! Surprise!  Deregulation doesn't work for the airline industry either!

While the report focuses attention on the current sorry state of the airline industry, and its underlying structural problems that lie behind the recent rash of airline crashes and near-misses such as the crash of the Continental/Colgan flight to Buffalo, it traces current conditions back to the decision, 30 years ago, to deregulate the airline industry.

How's this for an astonishing fact:  Since 2000, U.S. airlines have reported net losses of more than $33 billion--almost twice their accumulated profits from 1938 to 1999!

Of course, the trump card for the deregulators is the claim of low fares, and broad affordability, but the executive summary notes:

[Economist Alfred] Kahn [the "father of airline deregulation"] and others have taken refuge in the argument that deregulation has produced lower airfares and wider access to air travel. The Demos report concludes that even this benefit is widely overstated. "While the price of flying has come down over the past thirty years," the report notes, "it decreased at a comparable rate from the 1940s through the 1960s. In any event, low airfares are as much a problem as an achievement if they leave an industry without the resources to maintain service standards and make crucial investments in equipment, technology, and human capital."

If anything this understates the case.  If deregulation has resulted in net industry losses, those fare reductions were paid for by the airlines creditors! What kind of a business model is that? Considering the amount of technological innovation, and the increased traffic volume, it seems altogether possible that fares would have fallen more without deregulation!  Heck, the food might even have been edible!

This is only one industry, but the story's the same everywhere you look: the deregulation mania has been a disaster for America.  Sure, stupid regulations can be a pain in the ass.  But that's about stupidity, not regulation per se.

This is an excellent report, but we need to build on this and other detailed reporting on specific failures of de-regulation to develop a new narrative stressing the positive value of smart, far-sighted regulation in crafting systems that work for everyone.  If freedom means anything, it's not just freedom from arbitrary restraints, it's freedom to do things of one's own choosing, and the capacity to do things depends in part on soundly-functioning systems, from cars that won't blow up to government that won't get you killed for reasons they lie to you about. That's why smart regulations expand our freedom, rather than restricting it.

A few juicy tidbits from the report on the flip--along with some broader thoughts on history, transportation and freedom.

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Weekly Audit: Why Accountability Matters

by: The Media Consortium

Tue May 26, 2009 at 10:26

by Zach Carter, Media Consortium MediaWire Blogger  

With workers all over the globe trudging through a catastrophic recession, it's almost a given that governments will be battling the economic slide for a long time. Part of the effort to rebuild must involve new rules and regulations, but meaningful systems for economic accountability will be just as essential. If we do not hold the reckless executives who caused this crisis accountable for their actions, we risk regressing into similar turmoil in the near future.  

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Post Holiday Frights show need for U.S air Passenger Rights Bill

by: villagernyc

Mon Jan 05, 2009 at 19:31

By Cody Lyon

The United States Department of Transportation says there is no federal requirement for airlines to compensate passengers who have been stranded because of a delayed or canceled flight.  

That was a spooky post holiday truth I learned first hand in Milwaukee Wisconsin this past December 27 during an Air Tran airlines connection point on the way from Atlanta to New York City.   The hours-long incident was a reminder that there is little, if any government oversight of some of our most basic but important consumer activities, like commercial airline travel.

Some might say, with the exception of safety, United States airline passengers are basically at the mercy of a profit driven business where passengers are basically left to their own devices to get from point A to B, almost like fighting your way onto the subway or buying a burger at a busy Manhattan McDonalds.

In most cases, if a flight is canceled, an airline will re-book you on the first available flight to your destination at no additional charge.  But, as was the case in my experience, finding extra seats could prove difficult, especially if you're out and about over the holidays.  In a nutshell, this led to a couple of hours of travel trauma as my fellow passengers and I tried to make it back to New York City.

That night, flight, #514 from Milwaukee to New York, was the last leg of a long itinerary that had been delayed earlier because of mechanical problems in Tampa.   Originally scheduled to depart Milwaukee at just after 5, the plane was eventually boarded at around 8:00 pm instead.  Once all the passengers were seated, stowed, etc., the pilot unexpectedly came on the plane's intercom and made an announcement saying we would all have to leave the plane.  Apparently, there was a legal issue that involved the number of hours the onboard flight crew had worked.

These were problems beyond the airline's control, but it was what happened after we had de-planed some might call questionable. And to us on that plane, the next few hours were a sign that America's airports are temples of chaos and abuse.  If that night in Milwaukee is any indication of a greater picture, airlines are allowed to operate with no clear rules of consumer protection or mandated guidelines guaranteed by government oversight.  

Back in Milwaukee, at around 9:00 pm after all the passengers had left the Air Tran flight confused and irritated, we watched as uniformed Milwaukee law enforcement officers slowly strolled up to the gate and perched against the podium as the agents on duty filled us in.  Obviously, the arrival of "the law" signaled that the news passengers were about to get, would probably spark tempers among the passengers, some who were already barking at agents. Clearly, the agents had been through this sort of thing before.

But repeat performance or not, traveler anger was understandable. The agents told us there was nothing they could really do.  Instead, passengers were told to call 1866-airtran and reschedule another flight to New York.  It was then that the truly frightening moments of the evening arrived.  

Most of us assumed that "rescheduling" meant we'd be booked on a flight that following day.   But alas, ignorance is bliss.

In fact, when some passengers made the call to Air Tran's customer service line, they were told the earliest they could fly would be the following Thursday, better known as New Years Day.   The reason being that earlier Air Air Tran flights from Milwaukee to New York were booked solid.

I called right away, and was initially told Tuesday would be the earliest I could get home, but while speaking on the phone begging the agent for something earlier, she paused, then casually told me, oh well, 'now that flight's full,' which then put me at Thursday as well.

The problem was, I had to work that following Monday. I felt the tears knocking on the door in this room full of strangers as a sense of helpless rage infected my soul.  As I began to boil over, one of the uniformed Milwaukee deputies eyed me and after I exclaimed a loud "Oh No!" he told me to grow up and act like a man.

Truth be told, Air Tran agents on the scene and phone were clearly ill prepared for the questions they were being peppered with and that included: could other airlines accommodate us, what about a hotel room and others, instead the agents on duty ducked heads and typed furiously into the screens in front of them as they told the furious interrogators they were 'checking on it.'

But then, after an hour or so of more tears, chaos and childlike confusion, one of the agents took a microphone and shouted to the stranded group that events were developing fast, that in fact, we might be leaving Milwaukee at 5 am that following morning.  But, by then, a cloud of suspicion hung over the airport leading most in the room to not watch and question every move, not trusting anything they were hearing.

In fact, once the group fully understood the problem was due to over worked flight attendants, a few passengers decided to take things into their own hands and began begging and offering money to arriving flight attendants deplaning other planes, begging them to accompany us on the New York flight.

In the end, cash tips from passengers weren't necessary.

Behind the scenes, a new plan was taking shape.  Flight 514's pilot was busy making phone calls to other planes.  Along the way, he apparently secured another flight crew to fly with us to New York.  Now, we wouldn't have to wait a few days or until 5:00 am, but instead, it looked as if we would fly to La Guradia as soon as the new replacement crew landed in Milwaukee, scheduled for around midnight that same evening.

By the time the new crew arrived, the on edge passengers had bonded thanks to the shared trauma of it all.  Some said they were shocked at America's apparent lack of control over the beasts it had apparently created through full deregulation.

There were sweet moments in the night that included meeting several interesting individuals, including a New York Social worker who worked with elderly clients, a teacher and a former neighbor from the East Village.  And, we all enjoyed an assortment of snacks and free soft drinks, provided by Air Tran.  In addition to the snacks, we were compensated with a free round trip ticket any place that Air Tran flies, including Cancun, Puerto Rico or Alaska.  

We arrived in Queens at around 430 am, around seven hours late.

In the end, nothing excuses the fact that many of us were almost stranded in an unfamiliar city for what could have been days.  What if some of us had placed our employment in jeopardy by missing work?  And, while it may seem petty, what about our holiday plans?  

The truth is, if it hadn't been for caring and diligent pilots along with the flight attendants who took our flight some of the passengers on Air Tran-Flight 514 might still be eating Wisconsin Cheese.

Perhaps its time for consumers to demand that government take cooperative steps with airlines in establishing some form of reasonable passenger rights legislation.  Perhaps then, not only will Americans feel safer about flying, they might have time to relax as well and still enjoy hopefully reasonable air fares in the future.

(also at my blog)

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Fannie Mae Bailout: Dereg Comes Home to Roost

by: Leo

Sun Sep 14, 2008 at 13:07

Sarah Palin apparently has a limited understanding of the troubled mortgage finance industry, as she told voters in Colorado Springs (9/6) that lending giants Fannie Mae and Freddie Mac had "gotten too big and too expensive to the taxpayers." She promised that "The McCain-Palin administration will make them smaller and smarter and more effective for homeowners who need help." Perhaps Gov. Palin may be forgiven for her shallow knowledge of the secondary mortgage market. Andrew Leonard of Salon.com noted (9/8) that Fannie and Freddie have been private entities and haven't cost the taxpayer a dime-so far. Ironically, the lack of regulation of mortgage bankers brought on the abuses that forced the government takeover. But taxpayers likely will end up picking up a substantial tab.
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"Owning Their Own Failure"-The Impossible Dream???

by: Paul Rosenberg

Sat Aug 30, 2008 at 19:30

In a diary yesterday, Digby highlighted this passage from Obama's acceptance speech:

For over two decades, he's subscribed to that old, discredited Republican philosophy - give more and more to those with the most and hope that prosperity trickles down to everyone else. In Washington, they call this the Ownership Society, but what it really means is - you're on your own. Out of work? Tough luck. No health care? The market will fix it. Born into poverty? Pull yourself up by your own bootstraps - even if you don't have boots. You're on your own.

Well it's time for them to own their failure.

After which, Digby commented:

I think this is the key to the case and when I heard it, I stood up and cheered.

I know that point is not very hopeful or very uplifting and it won't be the biggest selling point among swing voters. But there were plenty of those things in the speech. This is the case against conservatism that people need to hear in this country if we hope to move ahead. (Remind me to relate my convention story of trying to convince the 19 year old "independent" that his tax burden wasn't the reason he couldn't afford college. People have been brainwashed.)

Boy howdy on the brainwashing front!  How many different times and different ways has deregulation wrecked havoc on our country?  The S& L crisis.  Enron & the manufactured energy crisis of the early 2000s.  The sub-prime mortgage meltdown-just to name a few of the greatest hits our economy has taken from the deregulation delusion. And yet, no many how many disasters it causes, somehow deregulation itself is never to blame!

I too, was particularly thrilled to hear Obama speak this line.  And yet, I wondered to myself, what will it take to really make it happen?

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