U.S. Gets It Wrong: Infrastructure Investments Last

ACI-NA President Greg Principato this morning posted a blog on National Journal.com as part of its infrastructure funding debate.  Here is his post:

It is true that all over the world, governments, businesses and others are moving forward with critical investments in infrastructure.  There is a broad global understanding of the immutable fact of human history that those who invest in transporting their people and products will grow and prosper and those who do not invest will fall further behind.  Right now, the United States is in that second group.

Why?  Because we have gotten so wrapped up in political arguments over terms like investment and spending.  Revenue and user fees.  Revenue and taxes.  No one I’ve ever heard has seriously argued that infrastructure is not important.  But, we can’t get out of our own political way to make it happen.

In aviation it is even worse.  All over the world, airports, airlines and governments understand the need to modernize their aviation infrastructure.  They are increasingly moving toward user fees as a way to ensure a flow of revenue.  But not in the United States.  In fact, it is illegal for airports to generate revenue in this way, beyond a (very low by international standards) passenger facility charge capped for more than a decade at $4.50.  And, make no mistake here, either.  This is the federal government interfering in local affairs and decisions.  This is a fact of life established in the bad old regulated airline days, and has been left in place all this time.  And, in a time when we are looking for ways to build infrastructure without adding to public budget deficits, the PFC which accomplishes this very result, should be a centerpiece in this nation’s infrastructure strategy.

The really scandalous part of this is that U.S. airlines, unlike in most of the rest of the world where they seem to have a clearer view of their true interests, have led the fight to keep this cap in place.  Why?  Because they have never gotten over the fact that before de-regulation they controlled airports, and now they don’t.  They want to do everything they can to reduce competition and they know that the PFC was originally put into place to give airports a means to build infrastructure to PROMOTE competition.

There is an old New Yorker cartoon showing a corporate CEO explaining to his assistant that “I love free enterprise.  It is competition I can’t stand!”  That sums up the U.S. airline view of investment in aviation infrastructure.  Short sighted, to say the least.  And, the fact that the U.S. government has acquiesced in this for the past three decades is even worse.