Virgin America’s Bid to Start Flights Denied by U.S. From Mike Shedlock comes this analysis:
The US department of transportation (DOT) ruled on Dec 27th that the UK is a security risk and therefore British owned Virgin America Airlines is not allowed to fly within the US between San Francisco and New York. How flights originating in the US to other US destinations in the US posed security risks to the US was of course not explained (probably because the idea is ridiculous). They did not actually say “security risk” but what else could a law requiring 75% US ownership to fly within the US mean? The expressed concern was over “foreign ownership”.
I sure wish they would let me toss out a few questions on these interviews.
It would go something like this.
Mish: Are you saying the UK poses a security risk to the US?
DOT: No that is not what we mean to imply.
Mish: Is Branson, the CEO of Virgin America, a security risk to the US?
DOT: Uh... No we are not saying that either.
Mish: Does the fact that Virgin America is British owned make it easier for contraband or weapons to be smuggled aboard flights originating in the US?
DOT: No
Mish: Are all international flights into the US majority owned by US citizens?
DOT: No. Many countries have plane flights into the US.
Mish: Is that a bigger security risk than Virgin America wanting to fly from San Francisco to New York?
DOT: Uh... I have to go now.
This is not a victory for US airlines, organized labor, free trade, taxpayers, or anyone else other than ISOH (International Society of Hypocrites), led by none other than the USA and EU. The stunning irony is impossible to miss. The U.S. is pressing for an “Open Skies” agreement with the EU to lift decades-old curbs on where carriers can fly.
Presumably Continental, Delta, American, etc and organized labor benefited from this action. That is the “seen” perceived benefit. The “unseen” consequence is hundreds of people who are denied a job, restaurants and hotels that do not benefit from increased travel, customers denied the benefits of increased competition, and fuel services and mechanics that do not benefit from servicing another airline. It would not surprise me in the least to see the EU to use this as an excuse to continue to fight “Open Skies”. The odd thing is, the first to allow “Open Skies” would benefit even if the other didn’t.
