FlyersRights.org
Region Need No Compensation

(We Don’t Need No Education -Pink Floyd)
Tuesday, May 20, 2014

Mesa Airline’s CEO is “disgusted with Washington’s politics.”  

That’s the sentiment from CEOs of regional carriers, as US pilot shortages take its toll on the industry.

Pilots finally are taking a stand. Fewer pilots want to work for regional jet companies because it’s near impossible to survive on the pay. Between regulations, attrition, pending shortage, and over 80% of the US regional pilots rejecting contracts, the leverage is on the pilots side for the first time in decades. 
 
So the Regional Airline Association (RAA) is in a frenzy. Last month they testified at the House Aviation Subcommittee that passenger service to midsize airports would suffer and the economic impact will be felt across the country.  

 
Already we’re seeing this at midsize airports such as Cleveland Hopkins International Airport, where United is cutting 60 percent of its departures.

“We have made the difficult decision to reduce our flying from Cleveland”, Mr. Smisek said to United’s workers there in February. By June 1, Cleveland will have lost 70 of its average 170 daily departures from the airport.

Mr. Smisek said that “our continued losses in Cleveland” were the main reason for the reduction in flying there. But added, new federal safety regulations that impose higher training standards on entry-level pilots “are reducing the pool of new pilots from which regional carriers themselves can hire.”

Meanwhile, Mr. Smisek saw his compensation soar to $14.7 million following the United-Continental merger.

The hand-wringing continued at the RAA convention in St. Louis last week. Here are some highlights from Mesa Airlines’ CEO: 
 

– Blamed Congress for the “One Level of Safety” rule, requiring most Part 135 regional carriers in the U.S. to operate under more stringent Part 121 maintenance rules.
– Blamed unions and the greediness of captains for low entry-level pay.
– Claimed “race to the bottom” is offensive to him and not true.
– Says young pilots are going to Europe to fly with minimal hours and asks if it is good enough for them, why isn’t it good enough for us?

 
FlyersRights listened to the whole April 30th, 2014 Hearing of the Aviation Subcommittee, US House of Representatives re. Air Service to Smaller Communitits. Here are our points: (official statement link)

1. No passenger representative was allowed to testify, only airline, pilot union, airport and government reps. 
2. The airline rep claimed they tried to raise wages but the union would not let them, and sought to weight wages to senior pilot favor based only on seniority.
We suggest this can be solved with a minimum wage for airline pilots.
3. Big Airlines seek to force passengers to fly from their hubs even if it means driving 100+ miles or taking an expensive commuter flight to a hub.
4. Regional carriers can profitably fly nonstop point to point from smaller cites with regional jets holding 20-80 passengers but are inhibited from doing so because they are under contract and controlled by big carriers and lack access to big city airports. Solution is to make such anticompetitive contracts illegal and to establish national air transportation policy of all passengers not having to drive more than 80 miles to reach a network airport and build additional airports around choke point big cities like NYC and Chicago. 
5. Establish a fact-finding commission to determine why the number of 
fights is declining dramatically at double digit rates for medium as well as 
small cities.

Republic Airways Chairman, President and CEO Bryan Bedford also complained that the FAA’s new 1,500 hour First Officer Qualification rule has sparked a pilot shortage: “We cautioned lawmakers and regulators, throughout the lawmaking and regulatory process that including a largely inflexible andarbitrary flight-hour experience requirement as part of the final mandate would not only fail to improve safety, it would hasten the growing pilot shortage and imperil air service at communities across the country.”

Who’s Flying The Plane?

These new federal regulations were drafted in response to concerns over training and pilot-fatigue following the 2009 Colgan Air crash that killed 50 people. The regional model has killed itself through bad business practices. The new laws aren’t the reason for the pilot shortage, it’s 10 years of paying food stamp wages.

 
Rebecca Shaw, 24, the co-pilot of that flight had pulled an all-nighter to get a free transcontinental trip to work. She was living near Seattle and commuting to her job at Colgan’s operation in Newark, according to board investigators. She flew from Seattle to Memphis in a spare seat on one FedEx jet, and to Newark on another, planning to sleep in a crew lounge. She earned an annual salary of just $16,200.
 

Remember Candi Kubeck, the captain of ValuJet 592 that crashed in the Everglades in 1996 (110 people died)? Her salary was in the low $20’s. Then ValuJet became AirTran and everyone forgot.

In 2008 the FAA opened an investigation into whether two Go! airline pilots fell asleep during a flight from Honolulu to Hilo when they overshot the airport by 15 miles.    

Region For The Bottom

“I really get a little disgusted listening to these guys, politicians, talk about ‘race to the bottom’ because if we are in a race to the bottom, you know who we’re going to find down there? Congress,” said Jonathan Ornstein, CEO of Mesa Airlines at the RAA Convention . “It’s really offensive to me, as a 25-year veteran of this industry, and my people.” 

Mr. Ornstein has enjoyed a remarkable longevity thanks to an ability to exploit a large pool of cheap young pilots. Mesa, like the entire regional airline industry, relied on rock bottom wages and a high turnover rate to keep the salary structure low and the system afloat. Now the whole fiasco is blowing-up before their eyes and Congress is turning a deaf ear in the wake of Colgan 3407.

The regional CEOs shifting the blame to the unions and captains for the problems their businesses are facing is offensive. The regional jet CEOs want you to think airports are losing air service because of the 1,500 hour rule, and they are the victims. 

All this pressure for less than a 1500 hour First Officer Qualification is a ploy by the airlines to try to see if they can avoid paying for more experienced pilots. We already know that there is more risk with low-time pilots living in crash pads for barely more than minimum wage.  

It’s interesting that almost no regional had any motivation to raise wages when they could hire 300-500 hour pilots at starvation wages. Now that the laws of supply and demand have kicked in, it seems like Mr. Ornstein would like to re-write this law.
  

Well, by the same token, who needs an MBA to run a company?

Where’s The FAA Here?  

FAA chief Michael Huerta said he stands firm on his agency’s first officer qualifications requirements. He said:

“We broadened that flexibility as much as we could in an effort to address industry concerns,” explained Huerta. “But Congress’s intent was clear. They wanted to increase the qualification and experience requirements for pilots. We’re open to discussing ideas on strengthening the pilot pipeline, but industry must recognize that the FAA alone cannot solve this issue.”

FAA Under Industry Control   
 
In the sixties the president of the company was paid three times what a senior captain made. It took four pilots to fly a 707 across the ocean carrying 120 passengers. Today 2 pilots fly 400 people and yet their salaries (adjusted for inflation) have declined significantly. CEO’s now make multi-millions.

Interestingly the highest paid pilots are at Southwest which has the lowest paid CEO, the best safety record in the industry and the only major carrier who hasn’t sought bankruptcy protection.
 
Pilots’ pay, as a percentage of operating cost of a large airplane, is relatively minor. Expecting action from the FAA is hopeless. 
 
Congress needs to take a hard look at the FAA, a federal agency that has always seemed to be in bed with the industry it’s supposed to oversee.

Organized insanity is what happens when money and profits overtake reason. 
Public Demand    
We disagree with those who say the public demands cheap flights, thus the underpaid and exhausted commuter pilots.  

The traveling public may ‘demand’ a lot of things, but ‘public opinion’ should not jeopardize the safety of those aboard and those on the ground. This is a ‘free’ country, but that does not translate to common sense and regulation being thrown aside.    

 
Bring back regulation to all of these entities that have proven they cannot act in the public interest, cannot run the companies without government oversight, and certainly cannot police themselves.  

Letters
 
(In Response to last Tuesday’s newsletter, “Not Fare“)

Dear FlyersRights:
On your article, while I completely agree with everything you have noted,
you forget that back in 1975, they paid travel agents 10% commission on all airline tickets.  Domestic, international, foreign origin, everything.
We receive a big fat zero today especially on domestic markets.  Only on some international markets do we receive a commission depending on the contract.
So, yes, we are so much worse off now than then as travelers and travel agents.
I live in Vienna a I only have a minute between flights but I have to pause for a moment and comment on this last post on FlyersRights.org. It seems every time you post you come full throttle at the airlines. As a pilot, I know what a reduction in pay means and what losing more than half your hard earned retirement is like. I also know what is like to have the airline you are flying for go under and watch as your fellow workers go through the hard times that being unemployed brings. Airlines have to make a profit in order to survive.
When you demonize the airlines for trying to keep the cost of air travel down with low cost air fares that are meant to peel away certain cost that not everyone wants to pay for, that’s just wrong. Not everyone packs three bags for a five day stay when traveling. When you travel regularly you learn to travel light and less is better when traveling often. I speak with passengers every day and by far most of them are satisfied with the cost of their airfare. They realize if you want that additional legroom or more comfort when you fly you must pay for it. And ticket change charges are here to stay and all airlines post these charges on their web sights. Stop crying about the cost. If you want first class, pay the airfare!
Also, the cost profiles that you have posted are not true and fair representations of cost verses inflation rates over the past 40 years, 1975 to 2014. You fail to figure in the cost of equipment and maintenance increases over the last 40 years. Cost that have increased five fold and mainly due to the unions involved in manufacturing new generation airliners. When the design and testing of a new airliner these days cost between ten and fifteen billion dollars over a typical six year period, those cost get passed along to the consumer. These billions are spent even before the first plane is delivered. Push these cost into the price of a ticket and of course you will pay more for that ticket.
I don’t mind when people have legitimate complaints due to poor service but to complain about the cost of an airline ticket and charges for extra legroom or other services is basically ridiculous. As with everything else in life you get what you pay for and the more you want the more you will pay. And deregulation was by far the best thing to ever happen to the airline industry. We don’t need government to hold our hand or protect us from ourselves. We’re adults and no one forces anyone to pay for a product or a service that we choose to purchase or may not wish to purchase. Buying an airline ticket is no different than buying fuel, professional services, food, clothing, electronics, automobiles or any other consumer product. You don’t get a BMW when you pay for Hyundai.
No one wants to be on time more than I do. But my main concern is the safety of everyone behind me. If it means holding at the gate while I have a concern on the flight deck checked then we all wait, not just the guy in seat E-34 who just blew a gasket of his own and now wants the airline to compensate  him some way.
And like I tell everyone who complains about the airlines making a profit, stop complaining and buy you some stock in Delta!
CJK
ATP, Captain

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