Thread: FAA re-authorization not passed. 4000 furloughed, 70000 more out of work.

I wrote a few emails to friends explaining the FAA furlough to them. I'll post them here for discussion.


The FAA furloughed 4000 people starting Saturday July 23rd. Everyone who is paid by Facilities and Engineering funds (as opposed to Operations funds), who is also "non-essential" (most of them), is furloughed.

The FAA Re-authorization failure means that the FAA can no longer collect taxes or obligate F&E funds. Construction projects, upgrades, tech refreshes, and engineering are mostly shut down. Air traffic controllers, technicians and other operational support staff are still working, as long as the Operations fund holds out (until around early September). This also means that airplane tickets should be 7.5% cheaper since that tax is no longer being collected per flight. Naturally, this means that most of the big airlines raised their rates by 7.5% and assumed that not enough people would notice that it would hurt their bottom line.

Airlines take your tax break | The News-Press | news-press.com

American, United, Continental, Delta, US Airways, Southwest, AirTran and JetBlue all raised fares about 7.5 percent.

Virgin America, Frontier Airlines, Spirit Airlines and Alaska Airlines did NOT increase fares. Frontier Airlines also has pretty nice planes with good legroom, if I remember correctly (I use them when flying into Denver). Spirit Airlines has little leg room but is very cheap. They also have their email blasts written by frat boy interns. The latest one had a website that they set up urging political advocacy to halt increasing the excise tax beyond 7.5% when it returns. It's a change from their normal (but still ridiculous) emails.

Spirit Airlines - Don't tax Me Bro!

The main issue behind the failure to re-authorize is a Republican attempt to nullify a new union elections rule adopted by the National Mediation Board (NMB, airline/railway elections board) last year. The NMB had ruled that, when workers were voting on whether to unionize, "abstain" no longer meant a "no" vote. This would result in workers unionizing if a majority of those who voted, voted yes, instead of requiring a majority of the workforce to show up and vote yes. The rule came into effect on June 2010. The previous rule had been in place for 75 years.

The Delta airlines CEO (Richard Anderson) has been lobbying against the NMB making it easier for his workers to unionize for the last few FAA re-authorizations. I did a cursory search and saw Delta leading the charge against it in February and March of 2011 as well as this July. And, wouldn't you know, Delta was being investigated by the NMB over charges that they tampered in the union election that occurred when Delta (mostly non-unionized) took over Northwestern airlines (which was unionized). The election failed and Delta was reported to have pretty blatantly tampered with the election to cause it to fail. The NMB sent Delta a notice that investigators would be in touch to investigate election tampering in the Flight Attendants union election on June 2, 2011.

Labor board to investigate Delta Airlines' union election - The Hill's Transportation Report

So the plot thickens. In this war of Delta vs. the NMB, Republicans vs. Democrats, Democrat senators are taking aim at Delta.

FAA shutdown complicated by debt negotiations - BusinessWeek

Sen. Jay Rockefeller, D-W.Va., chairman of the Senate committee that oversees the FAA, blamed a single air carrier — Delta Air Lines — for the shutdown. He said House Republicans were doing Delta's bidding when they sent the Senate a bill last week to extend FAA's operating authority that they knew Democrats would reject because it contained a provision eliminating $16.5 million in air subsidies to rural communities.

The underlying issue, Rockefeller said in a speech to the Senate, is a GOP effort to get Democrats to accept a labor provision in a long-term funding bill for the FAA that primarily benefits Delta. The bill was passed by the House in April. The Senate passed its own funding bill in February without the labor provision.

Republicans are also trying to cut subsidies to rural airports that receive Essential Air Services subsidies. They would cut funds for 10 communities that are within 90 miles of a larger hub airport as well as cut the amount of subsidies to 3 other airports.

... the 13 airports that would be affected by the House version of the bill are: Athens, Ga.; Morgantown, W.Va.; Glendive, Mont.; Alamogordo, N.M.; Ely, Nev.; Jamestown, N.Y.; Bradford, Pa.; Hagerstown, Md.; Jonesboro, Ark.; Johnstown, Pa.; Franklin/Oil City, Pa.; Lancaster, Pa., and Jackson, Tenn.

House-Senate subsidy showdown threatens FAA - USATODAY.com

I didn't look up whether those Congressional districts those airports were in, but EAS airports are considered a pretty good way to shore up support from constituents (by bringing jobs and infrastructure into their communities) and Arlen Spector (formerly a Republican, now apparently a Republican target) was key in getting the "Who gets EAS funding" rulebook rewritten to say that Lancaster, PA's airport was 80 miles away (driving) from the nearest hub airport instead of 68 miles away (the cutoff for EAS subsidies at the time was that it had to be 70 miles or more away from the nearest hub airport). So adding that rider to the bill after the union negotiations fell through was a big "fuck you" by the Republicans and is likely taking a direct swipe at what they saw as Democrat pork. Election year coming up, after all. Mica said as much.

Senate Majority Leader Harry Reid, D-Nev., has insisted the labor provision be dropped. Rep. John Mica, R-Fla., chairman of the House Transportation and Infrastructure Committee, acknowledged that he included the airline service subsidies provision in part to prod the Senate to cut a deal.

"We're trying to do something to motivate them," Mica told reporters.

I couldn't seem to avoid running into Delta airlines in my research... they're also pressing for more money to continue providing EAS services to the rural airports that they do support.

Two weeks ago, Delta Air Lines announced it would "adjust" flying into 24 small markets, most of them subsidized by the Essential Air Service. It claimed load factors were too low to be profitable, especially since Delta and its commuter carriers were planning to retire the smaller aircraft that service the routes.

But Delta tipped its hand. It might be willing to continue flying to those cities, the company said, but the government would have to pay up. "The subsidy rate must be higher in order for Delta to fly on the routes in question."

Budget Fight Hits Faa And Essential Air Service - Business Travel - Portfolio.com


As a bit of historical context, the last FAA authorization bill was in 2007. Since then, the FAA made it through 20 extensions and none of them had politically charged riders.

I'm glad to be working right now, especially since the Democrats see this as something that will require a decent political fight to get done acceptably and they're busy with other things right now. Last word from Harry Reid was that this item was not on the agenda. The FAA administrator and transportation secretary are going to news outlets, town mayors, etc... trying to drum up more support (they were going to Congress before the shutdown, but that didn't work so well). I'd be surprised if the furlough was lifted before next Tuesday's debt ceiling fight. I just hope that they get to it before the summer recess. The workers furloughed and projects impacted by this are mostly upgrades, tech refreshes, and new systems that are needed to replace obsolete systems or keep older systems running. When the brakes are slammed on as they have been, it greatly impacts the efficient spending of the public's money. Even the government shutdown we almost had in April caused financial loss due to the disruption of personnel and schedules.

This is a bit long-winded but I hope it sheds some light on what's going on with the FAA.

Congress left town without passing the FAA Re-authorization. This means no possibility of the furlough ending until Congress returns from their summer recess. Their calendar showed that that recess was August 8th to September 5th (Labor Day) but apparently they split town on August 1st (House, who got us into this mess) and August 2nd (Senate, who decided not to re-cripple airline unions and their president but but at the same time didn't have the leverage to get us out of this mess). Most of the people I work with are gone until at the very least, September 6th and likely longer since this has the look of a bitter partisan battle.

Rachel Maddow did a piece on it that sums it up pretty well, until it goes off the rails in the last 15 seconds.

Rachel Maddow Show

I agree with what she's saying for most of the piece. She doesn't really talk about the Essential Air Services thing that the Republicans tacked onto the temporary re-authorization (i.e. the "few months' of leeway while we work on a long-term re-authorization agreement" extension that we've been getting since 2007). The whole Essential Air Services thing was added to the temporary FAA authorization extension, by Mica's admission, just as a dig at Democratic congressmen to use as a bargaining chip. It cut funding to rural airports in districts belonging to Rockefeller/Reid/etc and I don't think that anyone is claiming that the $16M it is reported to have cost per year is worth losing about $30M per day.

I disagree with the last 15 seconds of the video. For the record, Delta has NOT been "shamed" into returning the 7.5% fare hike that it levied on flyers on tickets bought after July 22nd later. It's still keeping that money (shamelessly). All Delta is doing is returning the taxes that it collected from flyers (that it was going to have to give to the IRS) before July 23rd. Basically, those taxes were no longer valid if the traveler was flying July 23rd or later and the travelers would have to ask the IRS for that money back (and had legitimate claim to it) so the IRS asked airlines to handle the paperwork, and Delta/US Airways agreed to handle it. Delta was never going to be able to keep that money, they are just making it easier for the consumer to get back.

They still raised fares on all flights after July 22nd and are pocketing that money (estimated to be over $1B spread across the industry by the time the FAA is reauthorized), and have certainly not been shamed into giving it back. And when the FAA is re-authorized, travelers who bought tickets for flights that actually occur after the re-authorization will likely have to pay 7.5% tax on those flights, and Delta will blame the government for the fee.

Delta seems to have fooled at least one major news organization into thinking it was refunding the 7.5% fare increase when all it was doing was making it a little easier to give back previously-collected money that Delta had no claim to in the first place. These savings are for the most part not being passed onto the consumer, but rather being pocketed. There were 787 million enplaned passengers in 2010, and Delta was the nation's busiest airline, responsible for 111 million of those passengers (14%). July 23rd to September 6th is 46 days, the MINIMUM time for the furlough period. The FAA collects about $28.6M per day in taxes, which are now not being collected. This equates to $1.316B. 14% of $1.316B is $184M. This is my best guess at the amount of money that Delta will pocket. I got these numbers from the US Department of Transportation's Bureau of Transportation Statistics 2010 Traffic Data report (attached). The only airline who is both in the top 10 for passengers in 2010 for the USA and who did not raise their rates to cover the lack of FAA excise tax is Alaskan Airlines (In spot #10). In short, the taxpayers are paying close to an extra $1.3B to the airlines and getting nothing in return (instead of paying $1.3B in taxes and getting public infrastructure for it, or not having to pay the tax at all).


Let me state it as clearly as I can: Delta (the USA's largest airline) lobbied Republican Congressional leaders to attach a politically-charged rider onto a bill it had no business being on. It is responsible in large part for putting about 70,000 people out of work for a minimum of 6 weeks, during one of the largest recessions in this nation's history, and over $1.3B of lost money for the government in a period of economic crisis. For the most part, this reduction in taxes has not resulted in a reduction in ticket fees for the flying public. As a result of the furlough that they induced, Delta stands to gain about $180M after raising its rates by the amount of the missing tax.



Here is a neat article on who's keeping the money and who's passing it on (and to what extent):
Alaska Airlines | Airline Reporter

Here's a neat article on Alaska Airlines (the good guys) forcing those other bastards to keep their fare-gouging to a minimum, at least in Alaska.
Cheap flights from Anchorage to Denver, San Francisco, Mexico, Long Beach during the FAA shutdown | Alaska Dispatch

I did hours of research on this because I really wanted to have a good understanding of it, and tried to explain it as well as I could. It's a matter near and dear to my heart as most of my friends are out of jobs for 6 weeks because of it. I tried to lay it out pretty clearly. Are you trying to say that it's valid for Republicans to hold up the FAA's re-authorization because they protest the decision of an unrelated board (the NMB)? The FAA has no power over the NMB, and the previous 20+ reauthorizations have never had a politically-charged rider attached to it. Even GOP Senator Hutchison (R-TX) is against tying these two different items together so tightly that it's worth killing the FAA to fight the ruling of the NMB. She has both spoken out against the House GOP on this and tried to put a bill that's actually related to FAA activities (surprise) that she was able to get the Senate Dems to agree to.

Did you see in my post what the "rule" you talk about actually is? Disregarding the fact that it should not be tied to the FAA bill, is the old rule, in your mind, a way to have a valid and democratic election? Do you think that most other industries use those rules for union elections, or are they closer to "abstain does not mean a no vote" that the NMB shifted the rule to?

It honestly looks like you just found the first Republican talking point you saw and posted it. I am happy to discuss this but I feel that I covered most of your talking point in my original posts, which are fairly detailed.

I feel bad for those guys. They are out of work because Congress did not do their job and left town.
It is shameful that Congress left all those people hanging instead of working out a compromise of some sort.

Originally Posted by deathgodusmc

" Republicans complain that the new rule reverses 75 years of precedent to favor labor unions."Democrats have to decide if they are going to be the handmaidens of the labor unions in every policy," Sen. Jon Kyl of Arizona, the No. 2 Senate GOP leader, told reporters. "Every now and then they should put the American people first instead of their constituency."
FAA shutdown to continue as Congress leaves - Yahoo! News





Seems your slanted to the dem side so im just posting what the reps said.

Also, I would like to point out, that representing their constituency is what every elected official is supposed to do. We all vote on representatives to go to D.C. to look out for our interests.

Originally Posted by Gumby

I feel bad for those guys. They are out of work because Congress did not do their job and left town.
It is shameful that Congress left all those people hanging instead of working out a compromise of some sort.

Well, at least we didn't default on our debt...I mean: it could have been MUCH worse. Of course, what I'm saying is equivalent to saying, "I could have shot him in the head, but I just broke his knee."