Opinion

Opinion: You May Rush to Judgment on United Incident — But Don't Rush to Regulate

Market forces may have more impact than legislation

United Airlines passenger David Dao was dragged from flight to make room for airline employees. (Screenshots)

Watching videos of a man bloodied and limp being dragged from an airline seat is disconcerting irrespective of your relative weighting of common sense and the enforceability of contracts. No matter what the legal entitlements of the passenger and United Airlines might be, few will deny that what occurred on Monday’s United flight from Chicago to Louisville was outrageous and should never have occurred,.

Congresswoman Eleanor Holmes Norton is already calling for hearings on the event in the House Transportation and Infrastructure Committee. In prior airline situations where outrageous and disconcerting events have occurred, legislators and regulators have rushed to respond to public opinion, and those reactions have been ill-conceived or at the very least burdened with unintended consequences, which, if known, might have resulted in a different response.

Responding to the Valentine’s Day blizzard of 2007 when delays on the ground ran to seven hours with no provisioning for passengers, passenger advocacy groups pressured the DOT to implement a rule that went into effect in 2010, which provided that an aircraft has to take off, or passengers must have to have a chance to deplane, within three hours after the aircraft leaves the gate (with the inverse rule for arrivals), or incur a fine of up to $27,500 per passenger. The rule has virtually eliminated long tarmac delays.

But at what expense?

A 2015 Dartmouth/MIT study found that, for every passenger minute of delay on the tarmac reduced as a result of the rule, total passenger delay has increased three minutes — once the delay occasioned by rebooking and more numerous and lengthy misconnects are included. In high load-factor environments, passenger delay increases dramatically because of the difficulty of rebooking. The DOT has no visibility into passenger effects, so they believe they have done a good thing even though overall passenger well-being may have declined. (The rule was statutorily amended in 2016 to mitigate some of its most harmful side effects.)

Following the February 12, 2009 crash of a Colgan regional jet on approach in Buffalo, the families of fatalities became a driving advocacy force, pushing for new regulations relating to pilot competency. Their efforts resulted in a provision in the FAA Modernization and Reform Act of 2012 requiring that co-pilots have a minimum of 1,500 hours of flight experience. This was a curious provision since both of the pilots involved in the Colgan accident had flown substantially more than 1,500 hours.

While no one credibly argues that the “1,500 hour rule” has reduced aviation safety, it is clear that the rule has reduced service to small communities. And aviation professionals do question whether the rule has had the competency-increasing effects for which it was designed.

Many pilots obtain their required flight hours by merely pulling advertising banners over ocean beaches, and others who obtain more skill-enhancing simulator training do so at huge personal expense and a debt load that they carry for years into their early career.

This debt load makes it more likely that young pilots will commute to their flight base from a cheaper place to live, and this “commuter” lifestyle was an identified factor in the Colgan crash, even though it was not addressed in the rule.

It will be tempting to rush to legislate or regulate overbooking and denied boarding more severely following the United event.

Overbooking has clear efficiency-enhancing effects and the reported rarity of involuntarily denied boarding indicates that the airlines are pretty good at managing their inventory. Unfortunately, involuntary denied boarding is a necessary concomitant to overbooking. Any effort to control these two airline activities will certainly be attended by unintended consequences. They may or may not be severe.

If the public outrage at the recent United Airlines denied boarding public relations catastrophe is genuine and heartfelt, shouldn’t there be booking effects? If prospective passengers are as concerned about this situation as their reported statements would indicate, won’t market effects on United have their own disciplining effect that will be more targeted than could be produced with a blanket rule?

The beauty of market discipline is that it is more nimble and can be recalibrated more easily than governmental action. It is also more trusting of the true values of the consumer.

David Grizzle is a former senior vice president for customer experience at Continental Airlines, a former chief operating officer of the Federal Aviation Administration and the CEO of Dazzle Partners LLC. He can be reached at david.grizzle@dazzlepartners.com.

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