In Case You Missed It: Economic Policy Expert Highlights Federal Perimeter Rule Anti-Competitiveness, Need For Pro-Consumer Reform
“Lowering the cost of flying and expanding the convenience of air travel is in everyone’s interests.” – Stephen Moore, Distinguished Fellow in Economics at The Heritage Foundation
In case you missed it, a new op-ed in the Washington Examiner by Stephen Moore, distinguished fellow in economics at The Heritage Foundation, outlines the need for modernizing the perimeter rule and the benefits for consumers with additional flights to and from Ronald Reagan Washington National Airport (DCA).
Moore highlights how vastly different the air travel market has become since the perimeter rule was enacted nearly 60 years ago, as air travel to and from Washington, D.C. has increased tenfold. He notes that DCA is the only airport in the country subject to federal restrictions on the number of allowed flights and adding more inbound and outbound flights during nonpeak times is a “no-brainer.” Moore also observes that the two airlines opposing new flights “don’t have any legitimate public policy objection: It’s just about protecting their turf from competition.”
He calls on Congress to support the bipartisan Direct Capital Access Act (The DCA Act) to enhance competition and lower airfare for consumers.
Read the entire piece in the Washington Examiner HERE and below:
To Reduce Airline Ticket Prices, Expand Washington’s Reagan Airport
Stephen Moore, Distinguished Fellow in Economics at The Heritage Foundation
June 8, 2023
…Reagan is the only airport in the country that is subject to federal restrictions on the number of allowed daily flights. This makes no sense anymore because the airport has just been modernized with more gates. So, increasing the number of inbound and outbound flights during nonpeak times is a no-brainer.
Over the last 50 years, the amount of air travel in and out of D.C. has increased tenfold — or about three times faster than the number of flights. Now you know why you’re getting stuck in the middle seats. If these trends continue, the airlines will have to stuff passengers in the baggage compartments.
Even worse is a “perimeter rule” written when LBJ was president, which restricts the overall number of flights that can take off and land outside a 1,250-mile radius of Washington. That was a noise control regulation because back 40 and 50 years ago, jets were much louder and a nuisance to neighborhoods near the runways. But today, planes are much quieter, and so this issue is now moot (or mute). As a consequence, if you want to fly nonstop to the western cities such as Los Angeles or Seattle, with few exceptions, you have to trek out to Dulles, in the northern Virginia exurban parts of Fairfax and Loudoun counties. Or to even further out to BWI, near Baltimore, Maryland.
The House bill would add 20 to 25 inbound/outbound flights a day from Reagan as part of the Federal Aviation Administration reauthorization bill this fall. You don’t have to be a Ph.D. in economics to realize instantly that the main impact of this pro-consumer reform would be to increase competition and lower airfares. Here is an Economics 101 lesson for members of Congress who oppose this reform: If you increase the supply of something, its price goes down. The reform bill would also allow more nonstop flights to Denver, LAX, Salt Lake City, San Antonio, San Francisco, and Seattle.
So, who would be opposed to this? The two loudest lobbying voices against the measure are United Airlines and American Airlines. Why? Because United has a hub at Dulles and so is hotly opposed to diverting air passengers to the rival airport across town. American has a hub at Reagan, and so it doesn’t want Delta and Southwest and JetBlue competing with its high-priced flights out of Reagan. They don’t have any legitimate public policy objection: It’s just about protecting their turf from competition.
Guess what major airport in the United States has nearly the highest ticket prices? Reagan. This measure won’t just increase the ease of travel for D.C. residents and business travelers. It will lower prices.
Why aren’t the Federal Trade Commission and the FAA, with leaders chosen by President Joe Biden, at the front of the line pushing this pro-passenger measure? Over the past year, airline costs have risen by 18% and are expected to rise even faster this summer. FTC Chairwoman Lina Khan is trying to blow up airline mergers, for example, the proposed JetBlue and Spirit marriage, because she wrongly says it will raise ticket prices. But she’s been silent on the Reagan Airport issue.
What is even more incomprehensible is that the two Democratic senators from Virginia, Mark Warner and Tim Kaine, as well as the northern Virginia congressional delegation, are against the Reagan expansion plan. Hello! Reagan is in northern Virginia, where the population has tripled in 50 years. They don’t want more flights?
The bill is estimated to create more than 1,000 new jobs and generate up to $400 million in economic benefit to the capital region. And most of the travelers who will benefit from the lower airline prices live in Virginia. Has there ever been as clear-cut a case of House and Senate members misrepresenting the interests of their constituents? Perhaps they think United Airlines, not voters, is their most important constituent.
Someone ought to remind Congress that we are living in 2023, not 1966, and that today, airline travel is for everyone, not just the rich and powerful as it once was when Pan Am and its short-skirted flight attendants ruled the skies and served martinis to wealthy CEOs. Lowering the cost of flying and expanding the convenience of air travel is in everyone’s interests — except for the airlines that are lobbying their pals in Congress to keep ticket prices high.
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Learn more about Capital Access Alliance HERE.