Link: Port Authority to Fight Federal Proposal to Auction Airport Landing Slots - NYT
The Port Authority of New York and New Jersey announced plans on Monday to block the Bush administration’s proposal to auction landing slots at La Guardia, Newark and Kennedy Airports by banning any airliner that used an auctioned slot. ...
But the Port Authority says the auctions would do nothing to reduce congestion and would amount to an unauthorized new tax. “They’re going to be selling something that doesn’t belong to them, in an attempt to raise revenue,” Mr. DeCota said.
The airlines are also adamantly against an auction.
The Transportation Department’s top lawyer, D. J. Gribbin, said that such a ban by the Port Authority “vastly outstrips any authority they have.”
“We clearly have the authority, as we’ve done with orders that currently exist, to determine which carriers can access the airports at what times,” he said. And the slots belong to the public, according to the Transportation Department. ...
The issue is not really whether to limit operations, although the Port Authority opposes that, too. Earlier this year, the Transportation Department negotiated a limit of 82 to 83 takeoffs and landings per hour at Newark Liberty and Kennedy International Airports. Then it imposed caps to keep the number down. La Guardia is already limited to 75 takeoffs and landings per hour.
Rather, the question is how to distribute the now-scarce landing slots. The Transportation Department maintains that they essentially belong to the public and thus the government should decide how they are distributed, and collect the benefit, if any.
The airlines argue that they have spent millions of dollars building passenger traffic on routes and making physical improvements at the airports, and should be able to use their slots or dispose of them as they wish.
Mr. DeCota, of the Port Authority, said the airlines should be allowed to barter or swap slots among themselves. ...
It isn't terminal space that is at a premium. Rather, it is landing slots -- runway time. Yes, there is occasional gate congestion, but the long waits are to take off -- and the expensive waits are to land.
I'm delighted to know that the Transportation Department recognizes this scarce resource as belonging to the American people, and that the revenue from it should accrue to OUR benefit, not to the benefit of the airlines, and that their shareholders should not be the prime beneficiaries.
We ought never to sell such resources. Rather, 5 year leases should be auctioned off to the highest bidder. Should mid-lease resales by high bidders be permitted? I don't know. Should the bidding be limited to those who are the actual users, or should speculation by others be permitted? Do landlords contribute anything useful, for which they ought to be compensated? The classical economists would recognize this resource as "land."
Bravo!
Did you remove a previous version of this? I'm sure I commented, sending you a link to a Deloitte report about the value off Heathrow's slots? Or am I going barmy and have just lost the older post?
Posted by: Jock | August 27, 2008 at 01:35 PM