Thursday, July 28, 2011

Airheads and the FAA: 70,000 More Worries

As noted here in earlier posts, the U.S. Congress - the House of Representatives and the Senate - have each passed legislation to fund the Federal Aviation Administration, but can't blend - 'reconcile' in Washingtonese - differences in the bills. Moreover, an attempt to pass a 21st temporary funding measure for the FAA failed.

This latest example of governmental dysfunctionality caused 4,000 FAA workers to be furloughed on Saturday, Day 1 of the crisis. Today, Thursday, Day 6, they have been joined by 70,000 more workers who were laboring on badly needed airport expansions and other infrastructure upgrades; these have been halted for lack of money. This means no paychecks and no spending money for these people and their families. All this at near-record highs in nationwide unemployment, when throwing 70,000 more onto the unemployment rolls means U.S. retail outlets, automobile dealerships, construction companies and other busiensses will lose revenue.

Does Congress not understand that putting 70,000 out of work - not to mention the legions of federal workers targeted by presumptive future cuts in the federal budget - means adding significantly to short- and perhaps long-term unemployment?

As slowing growth in international air-travel shows, pace the International Air Transport Association's statistics ( a big influx of newly unemployed means the already-staggering business community won't see enough demand to hire these people and switch their employment to the private sector from the public sector. Result: Deep structural unemployment.

What a mess. Well, at least the air traffic controllers are still on the job and the planes are still flying. But without federal funding, without the revenue from suspended federal taxes on air fares and without continuing research on long-delayed next generation air traffic control systems, the crucially important U.S. aviation market is flying into turbulence and no one knows when it's going to fly back out.

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