Matt Yglesias

Nav Canada

Any pure partisan Democrats out there afraid that the right wing is going to hit upon some genius ideas to appeal to middle class voters’ economic aspirations have, I think, little to fear from the notions in this National Review symposium. Yuval Levin proves to have the solidest right-wing bona fides as he manages to incorporate a proposal for a giant tax cut for rich people (key phrase: “cut the number of tax brackets”) into an unrelated proposal for a larger child tax credit. You also get innovative proposals like James Capretta vision of recycling

John McCain’s substantively unsound and wildly unpopular health care plans. But some of these ideas—like Reihan Salam on housing affordability—are pretty good, albeit probably not huge political winners.

And then there’s Robert Poole on making airports better. His main proposal is something I’ve been supporting for a while:

Today’s landing fees are proportional to the weight of the plane, which encourages airlines to clog these airports with lightweight regional jets providing hourly service (e.g., from New York to Chicago), when the same number of passengers could be accommodated on larger jets operating every other hour. But no airline wants to be the only one to reduce flight frequency, so they all create a “tragedy of the commons,” producing massive delays. Market-value runway pricing would change those incentives, dramatically reducing congestion.

And here’s another idea about which I know little:

Air-traffic control needs to be reinvented as well, so it will have enough capacity to handle continued growth at an affordable cost. This means replacing manual, radar-based control with GPS satellite navigation, digital communications, and automation of routine functions. But it also requires institutional reform. Instead of being a tax-funded, congressionally micromanaged bureaucracy, the air-traffic organization should be detached from the FAA and converted into a user-funded, user-governed nonprofit entity like the highly successful Nav Canada (and similar entities in Australia, Germany, the U.K., etc.). That would free it from interference by Congress and dependence on always-uncertain annual appropriations.

As best I can tell, this Nav Canada story checks out. And as the correspondent who drew my attention to this proposal wrote, “I don’t consider the Canadians either insane or prone to unsafe behavior.” Clifford Winston and Robert W. Crandall at Brookings have also made this proposal: “We and others believe stronger actions are advisable, actions which would transfer the FAA’s responsibility for managing air traffic control to an independent private entity such as Nav Canada, the Canadian air traffic control organization.”

So provisionally I’m on board—we need a Nav Canada for the United States. Or maybe we could team up and have a Nav North America. But if there are readers out there with more intimate knowledge of air traffic management than I have, please do send in some emails with thoughts and links.

Runway Pricing

I was getting mad yesterday about private jets. Mark Kleiman reminds us that there’s actually something perfectly sensible we could do about it—charge market rates for runway slots.

Private jets completely aside, this would be very good public policy. In essence, it would create incentives for the runway slots at peak-demand times to be filled with large-capacity planes meaning that more customers could travel during the aforementioned peak demand times. It would also provide an additional discount for flights happening at low-demand times creating options for travelers for whom budget is the primary concern. And as a side-effect of all of this, it would make it much more expensive to fly a private jet into a major airport.

Meet The New Jet

Citigroup may be an insolvent zombie bank whose stock only has any value because investors are willing to bet on the possibility of a government bailout, but that’s not stopping them from buying a $50 million new corporate jet:

Even though the bank’s stock is as cheap as a gallon of gas and it’s burning through a $45 billion taxpayer-funded rescue, the airhead execs pushed through the purchase of a new Dassault Falcon 7X, according to a source familiar with the deal. [...]

“Why should I help you when what you write will be used to the detriment of our company?” replied Bill McNamee, head of CitiFlight Inc., the subsidiary that manages Citigroup’s corporate fleet, when asked to comment about the new 7X.

“What relevance does it have but to hurt my company?”

As an example of the difference between nationalizing a bank as part of a rescue package and simply getting its toxic assets “off the balance sheet,” in a nationalization scheme the taxpayers whose money is paying for the jet would also own the jet and be in a position to sell it off. Under a Classic TARP plan you pay for the jet, but Citigroup’s shareholders own the jet, and Citigroup’s managers get to use the jet.

Meanwhile, whenever you see these jets, keep in mind that (a) first class airfare is incredibly expensive, (b) first class air fare is cheaper than corporate jets, (c) first class airfare is very posh, (d) any company that needs a special subsidiary to operate its fleet of jets needs a union so as to redistribute some of the surplus away from managers and toward lower-level employees.