My intense dislike of the word "fair," grows daily. It has gotten to the point where only the phrase "for your protection," strikes me as more intelligence insultingly full of shit. As I have more than a passing interest in aviation, and more than that in general aviation, the recent scrap over the manner in which the FAA will be funded in future, and the frequent use of the word "fair" in that argument, has caught my attention. Sub Rosa has done a number of aviation related deals and yours truly has 1126 hours of single time tacked onto a multi-com-ifr ticket. The current proposals floating around will inflict serious harm on what is, believe it or not, the most efficient and safe aviation transportation infrastructure in the world.
At the center of the issue is the introduction of "user fees," into the FAA's funding system. User fees require each aircraft to pay a fee every time it flies. The fee is administered and collected by monitoring take off and landing and air traffic control use. User fees are primarily used in the European system today, and range from annoying to prohibitively expensive for smaller aircraft operators (read: private pilots). The high end of the range is typically motivated by protectionist ideals put in place long ago to defend state-owned national airlines from people flying themselves to and fro. Of course, with the privatization of many of the major airlines in the last 20 years, the user fees were not attenuated because the protectionist motive was reduced. The United States, by contrast, has some of the lowest costs and therefore the most vibrant aviation economies in the world. (You may also be surprised to know that a Cessna 172 can manage 15 miles to the gallon at cruise, and doesn't have to drive around curves- not exactly inefficient).
The current proposal plans, among other things, to introduce a user fee on turbine aircraft. This is a clever bit of politics, as turbine aircraft are generally the most expensive "high end" aircraft in general aviation and their owners, therefore, the least sympathetic. The next step down is the "piston" owners which includes the little four-seater Cessna 172. Of course, anyone who thinks these users won't eventually be "faired up" with user fees is kidding themselves. (Just ask the many Canadians, Australians and New Zeelanders who were lulled into complacency with the promise of limited user fees only to see even that thinly maintained fiction tossed by the wayside at the first opportunity).
These fees are a substantial switch from the current state of affairs where the FAA is funded by the Aviation Taxpayers Aviation Trust Fund (75%) and the taxpayer general fund (25%). The Trust Fund is where all the excises on tickets, per-gallon fuel costs and the like that form the current source of funding are collected. In addition, many countries (Germany, for example) charge user fees for safety related services like weather briefings. I'm not sure why we would want to create a disincentive for private pilots to use these services, and thereby reduce safety, exactly, but I'm sure it is just because I am missing something obvious. It is a little known fact that a private pilot can fly from coast to coast without once talking to an aircraft controller. Flying "VFR" this way is entirely legal in the right weather. It does, however, fail to take advantage of "another set of eyes," those being the controllers. Even with VFR flights, it is possible to use controllers for "VFR Flight Following," to route you around other aircraft or warn you of their presence- a much safer state of affairs. Twacking a user fee on these services will push more aircraft out of the optional flight following system, and even push more of them out of the IFR system in marginal conditions. This is not the brightest idea someone ever had.
The FAA's official position is that they are going broke, the Air Traffic Control system is inefficient, and that use fees are needed to fund the added expense of the locus like Very Light Jets that will soon clog the sky. This is as much noise.
The Aviation Trust is actually very flush with money and is projected to be in surpluses for the next 10 years. A look at their own budget reports tells the tale. Anyone who insists that there is a crisis either isn't in tune with the facts or is outright lying.
The Air Traffic Control System in the United States handles twice as many operations per controller as Canada, six times more than Germany and seven times more than the Netherlands. It is actually the most efficient system in the world. It is also the safest and among the cheapest in terms of cost per operation.
As for gnat filled skies, you don't have to be an analyst to figure out that there aren't going to be more than a few thousand Very Light Jets in the air in the next five years, even if every manufacturer currently known to man exceeds its production targets. Just as a bit of comparison, there are around 90,000 aircraft flights in the United States per day. Only around 30,000 of these are schedule commercial flights. General aviation makes up the rest. Between 2,000 and 5,000 commercial aircraft are in the air at any given moment in the United States. The idea that the addition another 3,000 aircraft (which hardly fly every day) over 3-5 years is somehow going to clog the system strains even the most liberal imagination.
The airlines are next to the podium, and whine that they are "overpaying," with the current fuel and ticket tax and that the system is not "fair." They conveniently fail to point out that all of the additional excise taxes are passed on immediately to their customer anyhow and since any increase in fuel tax applies across the commercial world and equally to all commercial carriers, it is hardly a competitive issue. The airlines like to quote the total tax revenues and then cite their "disproportionate" contribution thereto. They fail to point out that they burn the most fuel and gross the highest receipts when they make this argument. True, the fuel tax is used to pay for air traffic service, but it is also there, intentionally or unintentionally, to encourage fuel conservation. Burn twice as much, pay twice as much. That is "fair," at least in the traditional sense, which has long since lost all meaning.
Of course, the airlines like to portray general aviation users as "fat cats," a term that has also lost much meaning. The reality is much more benign. The median income of a General Aviation aircraft owner's household in the United States is $200,000. Two standard deviations from the mean household income of members of the Aircraft Owners and Pilot's Association (there are in excess of 400,000 of them) is $30,000 - $100,000 in household income. In fact, it is only in the United States that someone of a middle class background can ever hope to be a private aircraft owner or operator, so expensive is ownership in the rest of the Western world.
Let's consider for a moment also, the cost of collection. As an excise tax, the tax on fuel and the tax per ticket is painfully easy to collect. Fuel is the most simplistic, as the tax is simply withheld at the refinery level for Jet A and 100LL fuel. Per ticket taxes are a bit more burdensome, but once you have a system in place it costs nothing to withhold tax on a commercial ticket. Altogether the collection costs for this system are tiny. The IRS spent about $1.75 million to collect $55 billion in excise taxes in the 1990s. That's 0.001%. User fees are highly expensive to collect. A registration system and a billing system has to be put in place all over the country and,
So why in the world would the FAA and the big airlines want to move to a less efficient collection system that threatens safety and will make flying less affordable for hundreds of thousands of people? Well, for the airlines it's easy. Anyone who isn't flying themselves fills a seat. Plus, they would, obviously, love to throw their tax burden on the "fat cats" whenever they can. The FAA's motivation is less obvious and requires an understanding of the nature of the FAA's budget process.
Currently, the FAA has to seek approval for their budget and is subject to significant congressional oversight on the matter. Given the remarkable increase in aviation safety over the last twenty years, I believe this is a Good Thing (tm). It should come as no surprise, however, that with the new proposal the FAA will not be subject to nearly the same level of congressional oversight. They will be able to set their own user fees unilaterally and hike them at will. This is more a power grab by the FAA than it is an attempt to prove the system. Avoiding their annual battle of the paper-clips seems to be the priority. Add to this the fact that the FAA has started outsourcing critical services (Lockheed Martin currently runs Flight Service Stations and pilot briefing centers) and suddenly one wonders how involved government contractors are in the process of fighting for user fees. It certainly would make what once looked like a marginally profitable contract a massively profitable contract (until you account for the use reduction that these cost increases would cause). It is easy to see how one would be lulled into thinking this was a great idea for shareholders of Lockheed Martin.
Well, ok, so what? Who cares what happens to a few hundred thousand fliers? You should. General Aviation by itself is a $20 billion industry that generates around $150 billion in indirect economic activity annually. Nearly 2 million Americans are employed in general aviation and these jobs tend to be high skill and therefore high wage. The current system has created a robust mini-economy by widely expanding the pool of people who can fly. 60% of all the pilots in the world are in the United States and there is an airport of some size within ten miles of almost every community in the country. There are, in fact, almost 25,000 landing facilities in the United States (four times the number of the runner up). Less than 550 are serviced by commercial flights at all and 85% of commercial flights are between just 30 "hubs." Putting another 100,000 passengers into the commercial airline system overnight might sound good to the airlines, but it most definitely will not turn out well for passengers. More importantly, the use of the word "fair" here is unadulterated bullshit.
