Will bill to protect airline passengers get an extension?

In three weeks, American travelers may be flying without a net. Unless Congress extends a provision of the Aviation and Transportation Security Act set to expire on Nov. 19, travelers will lose the guarantee that tickets they've purchased on one airline will be honored by other carriers if it ceases to operate. Earlier this month, the Senate passed an extension and attached it to a 9/11 intelligence bill. The House has passed its own version of the intelligence bill, but without the extension. If passengers are to keep this safety net, the two bills must be reconciled to include the provision, and the total bill must be signed into law by the president. All this must happen within the next 20 days. And Congress will be on break until mid-November. While experts claim the extension will be passed, there are no guarantees, especially with the election intervening. Powerful forces, not least of which are the airlines themselves, would not be sorry to see this piece of consumer protection die a silent death. Passed in the aftermath of 9/11 by politicians mindful of the collapse of Vanguard Airlines, the regulation formalized a practice that U.S. air carriers had tacitly followed for decades. It mandates that should any U.S. commercial airline cease operations for financial reasons, other domestic airlines that operate flights on the same routes are obligated to transport passengers holding paid tickets on the defunct carrier if they apply within 60 days of when the airline ceases operations. They must offer seats, on a space-available basis, for a charge of not more than $25 per ticket each way. This also applies to return flights for those travelers caught in midtrip by the Chapter 7 bankruptcy. Even if Congress gets its act together before Nov. 19, this exclusion provides scant protection for those who have purchased tickets. This safety net has some huge holes, especially for Pittsburgh-based travelers. Even after recent schedule cutbacks, US Airways will still operate about three times as many daily departures from Pittsburgh as all other commercial carriers combined, and it will still provide service between Pittsburgh and more destinations than any other airline. Simply, if US Airways stops flying, there's no way other airlines will quickly be able to accommodate everyone holding tickets. People stranded midtrip may eventually find their way home, but those with tickets for the more distant future may be a long time finding reservations at any price, let alone $25 per direction. A traveler's only recourse would be to get a refund if he paid for his ticket with a qualifying credit card. Passengers who booked with frequent-flier miles, ticket vouchers and other non-revenue credits would be entirely out of luck. If the airline had been listed on a credit watch list, even travel insurance might not cover the loss. That might not even be the worst of it. With a half-dozen of the country's largest airlines now in bankruptcy or near it, with the sluggish economy, with fuel prices reaching all-time highs, with presidential polemics, with high anxiety about travel security, the situation has never been more ripe for the collapse of an airline. Or, for that matter, several airlines. This week, ATA decided to file Chapter 11 and reorganize. It is essentially getting out of the scheduled airline business, selling most of its routes, gates and passenger service assets to AirTran, which is also expected to honor all ATA ticket commitments. But the rupture of red ink probably won't stop there. United Airlines and Air Canada are flying under Chapter 11 bankruptcy protection. Other airlines that may face similar fates over the next six months include Delta, American, Continental and Northwest, and low-cost carriers, such as America West and Independence Air, and foreign carriers such as Alitalia are also flying on financial fumes. Conventional wisdom has always held that when one airline ceases operations, other carriers would pick up its pieces and passengers and move on, prospering with the decreased competition. But with the depth and scope of the entire industry's financial chaos and the glut of un-reclaimed frequent-flier miles that have accrued, it is questionable how willing any carrier will be to assume the passenger liabilities of a defunct carrier for $50 per round trip, let alone honor the frequent-flier credits for which the defunct carrier is committed. In fact, several air carriers are actively lobbying against extension of the guarantee provision as currently written. Then there are all the other financial consequences of an airline going out of business, from unemployed workers, unpaid vendors and billions of dollars in unfunded pension liabilities. It's not hard to imagine scenarios in which the liquidation of one major carrier could set off a chain reaction of other airlines collapsing. Could it be a "perfect storm"? Given decades of failed management strategies that have mightily contributed to, if not created, this all-fall-down possibility, what is more difficult to see is how this mess can be righted without massive government intervention, if not outright nationalization of what is essentially a failing national utility. The United States depends on air transportation as much as its highways. With the dismantling of the passenger rail and intercity bus systems, there are no other reasonable transportation alternatives anytime soon. If airline management can't figure out how to guarantee service given market realities, fundamental changes will be necessary. Unfortunately, this is all too reminiscent of the financial logic that created Amtrak instead of a cohesive, efficient national passenger rail system. Certainly, we can do better than this. The market demand is there, as is the infrastructure and the skilled labor. What's needed is a willingness by all parties to take a fresh look at the situation at which we've arrived and figure out more rational paradigms by which to operate. That and enlightened, committed, innovative, nonpartisan leadership. In the short term, pay close attention to whether the Intelligence Bill that passes Congress includes an extension of Section 145 of the Aviation and Transportation Security Act. If not, how can the public have enough faith to keeping advancing airlines millions of dollars in deposits for future travel if the airlines can't guarantee those commitments will be honored? That would be like buying and flying without a net.
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