Passenger Airlines TAX holiday

[freedom]

We had a thread in the us airways message board that asked for employee ideas to bring in revenue and cut costs for our airline … While I couldn’t think of anything us airways specific, my mind wandered to the larger overall picture in our country and the economic climate that we’re now in . With oil prices at new all time highs, as each day passes our airline transportation system simply cannot cope with this . Our citizens not only NEED affordable air travel , but they have come to EXPECT it , moving air travel out of the price range of the average joe will destroy this country like a sledge hammer , tourism is one of our nations large market drivers and we need to ensure that the engine which is tourism continues to run .

To that end I propose that the federal government cut ALL taxes possible for all passenger airlines within the United States … We should continue to allow the different states to charge their usual landing fee’s and other taxes in order to continue to ensure airport vs. airport competition . If the federal government can lower the amount of money they take out of each paying ticket across the board this will at the least provide SOME relief to the industry and the traveling public …

I know that there are questions about where we would make up the lost tax money , but I feel that as this recession worsens, if people stop traveling , they will stop spending and the government will in the long run lose more in tax revenue as people stop paying for hotel rooms , rental cars , dinners , etc …

While our presidential candidates are proposing a “gas tax†holiday to the American public, most of us know that this is an unrealistic plan that could in fact cause shortages etc… on the other hand , a longer tax holiday for the airlines could once again translate into lower airfare for our people … With the weight of the recession weighting down on Americans , we need now more than ever to “get away “ to help alleviate some of the negativity and economic pessimism . This tax holiday would act like a resuscitator to the American sprit and economy helping to get us out of this recession at light speed ..


Sadly I’m not sure we have any lobbyists at us airways , so if anyone out there in the aviation world wants to pick this football up and run , go for it …

 

[UAL_TECH]

No.

Either regulate or leave it alone and let the ‘market’ sort it out.
No free pass to travelers.

B) UT

 

[Cosworth]

I would rather see a requirement that all taxes raised through travel be put back into the industry. The infrastructure for air travel is pathetically out dated. The FAA is in bed with the airlines. The NTSB does not have enforcement capability IIRC. Unfortunately "We the People" are easily distracted by bright lights and shiny objects. Until "We the people" start holding our government responsible for actions taken on our behalf nothing will change.

This country does not run on good feelings and dreams. It takes revenue to run anything. Given the current level of waste and graft in this country I could agree with cutting all taxes and telling the government to stuff it. However, maintaining roads, hospitals, schools and countless other projects takes money.
I have no problem paying taxes (even higher taxes) as long as I get a return on my dollar.

 

[KCFlyer]

No.

Either regulate or leave it alone and let the ‘market’ sort it out.
No free pass to travelers.

B) UT

You mean you'd trust the same government that cannot be trusted to run a health care system to run the airlines? You should be careful what you wish for. Deregulation, as "bad" as it was to the industry, created a whole bunch of jobs. How many would be employed by an airline today had it not been enacted?

 

[UAL_TECH]

You mean you'd trust the same government that cannot be trusted to run a health care system to run the airlines? You should be careful what you wish for. Deregulation, as "bad" as it was to the industry, created a whole bunch of jobs. How many would be employed by an airline today had it not been enacted?

Considering the massive layoffs and outsourcing we see today, probably about the same.

IMHO, it’s an either/or question.
Not to be ‘insensitive’ but when the workers had to give wages, pensions and benefits to support the ‘transportation’ system.
I heard significant outcry about how we are overpaid and should sacrifice for the low fares.

Now ‘flyers’ request government entitlements to subsidize their travel.

I do not agree with that. :down:

We are already the most regulated/deregulated business in existence.

There is also a lot of politics regarding route authorization and route subsidies.

Either regulate or hands off. But our current situation is untenable.

Take Care,
B) UT

 

[UAL_TECH]

I would rather see a requirement that all taxes raised through travel be put back into the industry. The infrastructure for air travel is pathetically out dated. The FAA is in bed with the airlines. The NTSB does not have enforcement capability IIRC. Unfortunately "We the People" are easily distracted by bright lights and shiny objects. Until "We the people" start holding our government responsible for actions taken on our behalf nothing will change.

This country does not run on good feelings and dreams. It takes revenue to run anything. Given the current level of waste and graft in this country I could agree with cutting all taxes and telling the government to stuff it. However, maintaining roads, hospitals, schools and countless other projects takes money.
I have no problem paying taxes (even higher taxes) as long as I get a return on my dollar.

IMHO,

Good luck with that. The FAA has Billions in their coffers but will not spend it as it would increase the deficit (as it would even matter at this point of fiscal irresponsibility).

The FAA is not in ‘bed’ with the airlines, but in bed with the politicians who are being paid by the lobbyists who are paid by corporate. Follow the money!

It is truly a ‘MESS’ and no easy solution in sight.

Take Care,
B) UT

 

[Cosworth]

Until "We the People" start exercising our constitutional duties of oversight as far as I am concerned, we are just as guilty of our situation as they are.

 

[KCFlyer]

Not to be ‘insensitive’ but when the workers had to give wages, pensions and benefits to support the ‘transportation’ system.
I heard significant outcry about how we are overpaid and should sacrifice for the low fares.

Not to be insensitive, but one way the government has "regulated" the industry is the liberal bankruptcy laws. One has to wonder if your airline would have had to file had CO or US not been allowed to traverse thru bankruptcy court twice. Especially when there was an "oversupply" of seats - and fare wars to put butts in seats. Those butts didn't make any extra profit...it just sort of lessened the losses...but hey...they were butts in seats.

The big thing now is "mergers"...although mergers are usually only good for the top execs...they WOULD result in staff reductions for "redundant" positions and parking of several aircraft. It's kind of like a kinder, gentler version of bankruptcy.

Look at DFW in the 80's...Braniff was top dog at DFW, AA was growing, but considerably smaller. Braniff failed. And pretty much every single Braniff employee was out of a job. Suddenly, AA was top dog. They picked up what Braniff left - they hired some of their employees (and didn't have to mess with union integration issues), and they GREW...Delta moved in to pick up what AA didn't. Yes, it hurt a lot of Braniff employees - but a lot of them went on to work for AA, UA, DL, WN and others. A merger will do two things...put the less senior employees on the street, and create a whole lot of ill will between more senior folks in the "merged" workforce.

But I digress...the reduction in capacity will send prices higher. $200 round trip transcons will become a thing of the past. Maybe. It seems that even when faced with bankruptcy, a lot of airlines were after that vaunted crown of "market share leader". Didn't matter if they were losing money...they were leaders in market share. If a merged airline now wants to be market share leader in Chicago and Philly and Denver and Charlotte, will they still offer loss leader fares to keep that crown? Or will fares go up?

Back in the early 1990's, Bob Crandall (who like him or not was a visionary airline CEO) tried to implement "value pricing". IMHO, had it been allowed to work, the airlines wouldn't be in the shape they are in today. His plan was to make flying still be affordable to the leisure traveller - just not as affordable as it once was...but just a few bucks more. It was also to make flying VERY appealing to business travellers...by not having to subsidize loss leader fares. But - the airline management, in their infinite wisdom, set out to capture that all important "leisure market"..and charge business flyers out the wazoo to subsidize those fares. Too bad for them - many corporate travel departments learned to play the "leisure flyer" game...so instead of a businessman paying $450 to fly from MCI-DFW round trip, they were gaming the system and sending those guys out on the $200 fare. Because more seats were available at $200 in order to keep that 'market share' crown on the route. FWIW...I flew MCI-DFW one week prior to 'value pricing'...My fare - even back then - was $850. The lowest fare was around $120. Value pricing would have raised the advance fare to around $180, but lowered the fare I paid from $850 to $450. At that fare, my company wouldn't have felt the need to buy Vaseline to send me on the trip...and this is important...the airline would have made money on pretty much EVERY passenger.

 

[UAL_TECH]

Not to be insensitive, but one way the government has "regulated" the industry is the liberal bankruptcy laws. One has to wonder if your airline would have had to file had CO or US not been allowed to traverse thru bankruptcy court twice. Especially when there was an "oversupply" of seats - and fare wars to put butts in seats. Those butts didn't make any extra profit...it just sort of lessened the losses...but hey...they were butts in seats.

The big thing now is "mergers"...although mergers are usually only good for the top execs...they WOULD result in staff reductions for "redundant" positions and parking of several aircraft. It's kind of like a kinder, gentler version of bankruptcy.

Look at DFW in the 80's...Braniff was top dog at DFW, AA was growing, but considerably smaller. Braniff failed. And pretty much every single Braniff employee was out of a job. Suddenly, AA was top dog. They picked up what Braniff left - they hired some of their employees (and didn't have to mess with union integration issues), and they GREW...Delta moved in to pick up what AA didn't. Yes, it hurt a lot of Braniff employees - but a lot of them went on to work for AA, UA, DL, WN and others. A merger will do two things...put the less senior employees on the street, and create a whole lot of ill will between more senior folks in the "merged" workforce.

But I digress...the reduction in capacity will send prices higher. $200 round trip transcons will become a thing of the past. Maybe. It seems that even when faced with bankruptcy, a lot of airlines were after that vaunted crown of "market share leader". Didn't matter if they were losing money...they were leaders in market share. If a merged airline now wants to be market share leader in Chicago and Philly and Denver and Charlotte, will they still offer loss leader fares to keep that crown? Or will fares go up?

Back in the early 1990's, Bob Crandall (who like him or not was a visionary airline CEO) tried to implement "value pricing". IMHO, had it been allowed to work, the airlines wouldn't be in the shape they are in today. His plan was to make flying still be affordable to the leisure traveller - just not as affordable as it once was...but just a few bucks more. It was also to make flying VERY appealing to business travellers...by not having to subsidize loss leader fares. But - the airline management, in their infinite wisdom, set out to capture that all important "leisure market"..and charge business flyers out the wazoo to subsidize those fares. Too bad for them - many corporate travel departments learned to play the "leisure flyer" game...so instead of a businessman paying $450 to fly from MCI-DFW round trip, they were gaming the system and sending those guys out on the $200 fare. Because more seats were available at $200 in order to keep that 'market share' crown on the route. FWIW...I flew MCI-DFW one week prior to 'value pricing'...My fare - even back then - was $850. The lowest fare was around $120. Value pricing would have raised the advance fare to around $180, but lowered the fare I paid from $850 to $450. At that fare, my company wouldn't have felt the need to buy Vaseline to send me on the trip...and this is important...the airline would have made money on pretty much EVERY passenger.

KCFlyer,

Didn’t DAL try ‘rational fares’ just before BK?
Did not do them or anyone else much good, did it?
You make some valid points, but nothing will change.

Take Care,
B) UT