Thanks for the detailed explanation. Much very agreeable there.

Where we disagreed was on the emphasis of deregulation as the cause.

One of the things today’s regulations seem to do is limit the possibility of more competition, not just in airline operators, but even to the point of growing airport capacity.

So airline flights have become more of a commodity product, not much different than long distance bus service.

Airline industry is ripe for disruption, with how our technology is evolving, not unlike the taxi industry is and will. It won’t for some time due to the barrier that regulations create, but it may in our distant life times.

Since I earned my living in the airline business and was present before and after regulation, I know what happened. However, you’re correct that the analogy isn’t quite correct.

The airlines are in an industry where they have two basic things to sell – a route (where you want to go) and a schedule (when you want to go). The airplanes may vary a bit and the seats may vary a bit, but the product is basically the same (except for first class) from one airline to another.

The route and schedule planning is done by computers to maximize availability during periods of demand and minimize expenses during times of low demand. Other than that the only thing they can do to attract passengers is to cut fares. The passengers (except corporate and government) are making choices and paying out of pocket for what they get.

Deregulation resulted in a large number of start up airlines that had very low expenses. They leased their airplanes, they contracted for maintenance, baggage handling, and training. They did not have very high expenses for infrastructure or employee benefits.

On the other hand the established airlines had large maintenance facilities, large loans on aircraft they had purchased, big training centers, employed mechanics/baggage handlers/aircraft cleaners with full benefits, and had big costs for employee benefits, retirements, health insurance, etc..

The established airline managements were very slow to recognize what was happening. Though they quickly recognized the need to lower employee costs. All of the majors have been at war with their employees since deregulation. This has resulted in bad feelings among employees, low morale, mediocre service along with bankruptcies and mergers needed to survive.

The majors found that even though they had good routes and the right schedules, they were losing passengers to the low cost carriers. At first they believed that eventually people would want better service with complimentary meals, etc. They were wrong. Everyone went for lower prices to hold passenger load factors. To pay for the extra overhead the established carriers did away with perks, and instituted charges for things like baggage, reservation changes, etc.

Today we have an airline industry with mediocre service that competes only on price. Yes, it is driven by free market forces, but it still remains highly regulated. The government still controls the air traffic system; licensing requirements for aircraft, pilots, and mechanics; control of the training standards; and more. The government operated air traffic system is outmoded and inefficient. It adds millions of dollars of extra fuel costs each year as well as delays and cancellations that need not have happened.

One of the airlines’ major customers is the U.S. government. They have the bargaining power to get the lowest possible fares. If the government was the only customer, as it would be in universal healthcare, can you imagine how low they could drive fares? That’s what would happen in universal healthcare. The providers would not be working for the patients, but for the government.

If I remember, when I first heard about “the great health care controversy” – I believe it was Hillarycare at the time- people I know were kind of buying in because our assumption was that a major health problem like cancer, could easily bankrupt you and even very good insurance plans would drop you at some point, perhaps even during a critical time in the treatment. Some kind of solution to that problem seemed to be something the Government could usefully be involved in. Those of us approaching retirement lived in fear of that akin to fearing the bomb as children. The possibility was always in the back of your mind.

I don’t, or didn’t then, know anyone who wanted the govt. involved in our day to day health care.

It appears that our betters are determined to “Help” us come hell or high water. The arrogance/condescension of that attitude is palpable.

“You didn’t build that!”
https://www.youtube.com/watch?v=YKjPI6no5ng
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We can debate the merits of one “public works” after another, and I suspect it would be never ending and without conclusion either of us would find satisfactory.

Many of the same kind of arguments are used to justify a great many “investments”.

Take sports arenas, as just one example. The “benefits”, yes, are arguably “spread out” – all those sports fans can locally watch and cheer their team.

However, what about the non-sports fans?

And, are the benefits really that well spread, or is it effectively a subsidy to team owners?

Oh, it provides jobs and increases the local economy?

But, we never know what that tax money in the people’s own hands would have brought – hard, if not impossible to measure, right? Heck, does anybody bother to ask this before hand?

And now, it seems every city that wants a “Pro team” has to pony up, as they are played off each other for the biggest “subsidy”.
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So, yes, we can talk about dams. Owners of construction companies benefit. Owners of power companies benefit. Farmers, especially the big operators benefit (huge problem in CA, btw, as the farmers are paying a low price for water vs other industries and citizens – think that might have something to do with water shortages?). And, yes, some citizens benefit.

Have you thought of the cost? Or, do you only see the benefit side?

We’ll never know after the fact, will we? Much of it is too spread out and hard to measure.

Was there an alternative? Could the outcome have been more market driven?

Did it end up as originally promised?

Who knows, at this point. All we can see is the “benefit”.
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Like folks in other western nations who like their “free” medical insurance, they fail to connect the slow service, slow adoption of technology, inability of doctors to provide the latest and greatest to the “non-monetary” cost they are, in fact, paying.

Why? They don’t “see” it coming out of their bank account. Yet, they still think it is “free”.

There are costs to most anything government does. And, even when it “does” something, what people envision that it provides is often less than what they thought, if any positive effect at all.

Often, simultaneously, we will find certain groups who seem to benefit. Usually those leaders of the industry being regulated, along with a bureaucracy that would like to expand.

Few bother to think of these things when asking our government to do that “something”. Nor, bother to measure that against the probably over exaggerated benefits.

Few bother to think that maybe the more power we put into governments hands, the more unwieldy and opaque it all becomes, and the more subject to abuse it becomes.
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So yes we can justify in many ways government’s involvement for all kinds of things. But I don’t think many go into it with eyes wide open and understand the full consequences. They see their benefit and it ends at that (even assuming they assessed that correctly – often it is wrong).

In the end, we all end up “paying”, one way or another, blaming the left or the right, when it is ourselves who are demanding this, and failed to realize the aggregate consequences of our demands.

True in various ways that once government gets involved things deteriorate.

In large part, it is because they can live on, come what may, while private industry lives or dies by the market.

So, agree in general. Deregulation of the airline industry as a direct comparison is not what I’d pick to illustrate that point.

One could even argue that they are still in recovery mode from the over-regulation they had years ago, which left these companies with burdens they couldn’t live with under competitive pressures.

Universal and progressive financialization (i.e. redistributive change a la Fannie/Freddie)? Yes.

Universal health care is a concept embraced by people who recognize intrinsic value, and selectively by people with other characters.

That said, health care reform begins with education reform and moral revival.

Those programs are primarily paid for out of people’s pockets. Little insurance or government meddling. Once the government is paying the freight, they will cut the reimbursements because they have the power.

I have related some horror stories about military medicine (similar to what universal care would be like.) here. It is impersonal, assembly line, and mediocre.

I’m on Medicare. I get the statements that show what the providers are asking for and what Medicare is paying. There is a huge gap there. Often as little as 10 cents on the dollar billed. My question is which figure is the real cost of the treatment? Or is it all just a big game?

We can spend some of the budget on social safety nets, and in order to keep the peace, modern government HAS to. But we can’t sustain something programs that are designed to require an infinite amount of money, and the end result that liberals want (everyone realizes money is stupid and accepts communism as a preferable alternative) is not what liberals will get.