It looks like President Trump wants to privatize America's air traffic control system. The proposal is supposed to kick off "infrastructure week" — a public relations blitz highlighting the administration's plans to update the country's sagging infrastructure and create jobs. And lest Trump be accused of stealing from Bernie Sanders' playbook, the plans rely on minimizing federal spending and leveraging private capital instead. Privatizing air traffic control is an example of that thinking in action.
Unfortunately, it's also an example of privatization as a knee-jerk shibboleth rather than a problem-solving strategy. The predicament of air traffic control specifically is a really clear example of how conservatives will wreck government and then turn right around and complain that government doesn't work.
But first off, just what is that predicament?
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Air traffic control in the United States is run by the Federal Aviation Administration (FAA). It's many times the size and complexity of any other country's, and it's also arguably the safest in the world. Yet, many of its facilities are clearly understaffed and overworked, leading to fatigue among air traffic controllers and the potential for disaster. America's air traffic system is also trying to update from radar to a new GPS-based system. Named NextGen, the project should cut down on flight times, reduce fuel usage, prevent delays, rationalize flight routes, and more. But a fair amount of time and money has already been spent on NextGen, with little to show for it.
It's just not clear how privatization solves any of these issues.
At its most basic level, the case for privatization is that market competition forces businesses to become smarter, more efficient, and more user-friendly. By contrast, government agencies don't face competition so they grow bloated and sclerotic.
But whether or not you buy this story, privatizing air traffic control specifically wouldn't actually change the fact that the system faces no competition. Trump's plan is based on a bill championed by Rep. Bill Shuster (R-Pa.), which in turn is based on how a number of other countries — including Britain, Germany, Canada, France, and others — have privatized their systems. These countries basically created different "cooperatives" run by air traffic control workers' unions, the airline companies, and various other stakeholders. Crucially, the systems were still the monopoly providers of all air traffic control services to each country. It wasn't as if markets were suddenly opened up, allowing multiple vendors to compete to provide the same service in the same air space.
As Max Sawicky pointed out in a very comprehensive paper last year, the technology used by air traffic control systems is also pretty unusual and very hard to replace regularly. So there's not a lot of competition in that area, either. (And if the government wants to start a competitive bidding process for better technology, it hardly needs to privatize the whole system.)
Essentially, the only thing this form of "privatization" changes is who runs the monopoly provider of air traffic control services. But the actual structural incentives that supposedly make private actors better would still be absent.
But there's more.
Relying on the FAA's own inspector general, Sawicky also pointed out that the agency already doesn't have to follow the rest of the federal government's rules concerning personnel or procurement. That casts further doubt on the idea that red tape is holding the agency back from modernizing air traffic control. It's more likely that circumstances unique to the FAA and air traffic control just make it intrinsically difficult to operate or attain resources in a super-efficient manner. Sawicky points to the U.S. Postal Service, another institution that occupies a similarly weird position. It's technically outside the government and financed self-sufficiently as well, but in practice it's still often bogged down by political games and meddling from Congress.
A more likely culprit for the FAA's bureaucratic troubles, and the setbacks faced by the NextGen project, is Congress itself. The agency must rely on Congress for its funding, and Congress has been beset for decades by an ideological war over how much government should spend, how much it should tax, and how much it should borrow. So the agency's funding jumps up and down from year to year, and it occasionally faces government shutdowns and needs to put its workers on furlough. "As a result, the FAA has had difficulty making long-term commitments with contractors," The Washington Post reported.
Privatization would ostensibly solve this problem, because funding for the new air traffic control system would come from user fees imposed on airlines and their customers. But capital investments and system upgrades would need to rely on the newly private entity's ability to borrow. And its ability to borrow would be greatly enhanced if those debt obligations were guaranteed by the government, which throws us right back into the ideological fight over the proper fiscal role of government.
On top of that, financing the air traffic control system with user fees can leave it vulnerable to recessions and other economic shocks: Following the drop in air travel after 9/11, Britain's system almost collapsed, and Canada's had to dip into reserve funds.
The deeper point, though, is that the FAA's inconsistent funding is itself a creation of conservative ideology: The Republican Party's obsession with austerity is what's forced various shutdowns and driven the wild swings in agency funding. A commitment to simply fund the FAA indefinitely at the levels it needs would implicitly jeopardize the GOP's ideological commitment to low taxes and low deficits. Once you've allowed for the possibility that some government functions are too important to cut, how do you stop that idea from spreading?
So Republicans are pushing privatization as a solution to a mess created by their own ideological fixations. It's a classic example of conservatives wrecking government's ability to function, then turning to voters and saying, "See! The private market should run everything instead."
None of this is to imply that Shuster's plan would be a disaster. As mentioned, plenty of other major Western countries have done this, and it has worked out fine. But the absence of a strong argument against privatizing air traffic control is not the same thing as a strong argument for doing it. None of the problems facing air traffic control are problems that privatization would solve.
If lawmakers want the Federal Aviation Administration — or any other part of government — to function as advertised, they ought to start by committing to properly fund it.
