As President Reagan’s former transportation secretary, it’s gratifying to see Washington is finally finding the gas pedal when it comes to infrastructure. We all have seen the cost of poor infrastructure, slowing down both us and U.S. businesses. But while we work ourselves out of a backlog of technology, concrete and steel problems, it’s also time for Congress and the administration to cast a critical eye toward the operational risks facing our infrastructure.
We cannot just rebuild America’s infrastructure and pat ourselves on the back — we have to strengthen how it operates and serves us for the future. I know there is no industry for which this rings truer than aviation. When President Trump met in February with America’s aviation industry leadership, everyone agreed that our aviation infrastructure needs to see upgrades, particularly with new technology. However, no matter how significant those investments could be in a new package, America’s airports may be left without sufficient operations if strategic industry risks are not addressed soon.
U.S. airlines are being sabotaged by unfair competition on global flights, putting at risk the hub-and-spoke system that supports their ability to connect small- and medium-sized airports to larger hubs and global destinations. What good is a shiny, new airport without planes to land at it?
America’s aviation market is experiencing what the steel industry went through — the dumping of cheap, subsidized goods meant to shut down the competition. The United Arab Emirates (UAE) and Qatar have poured more than $50 billion into their state-owned airlines, Emirates, Etihad Airways and Qatar Airways, which means they can expand anywhere and everywhere they like, regardless of profit or demand. Their seat capacity to the United States grew by 43 percent in just two years.
American, European, Asian and Australian airlines, which don’t have billions in government subsidies, don’t have a realistic chance to fight back. This has led to European carriers cutting routes and U.S. airlines foregoing even growing markets like India. When these airlines enter U.S. markets, they aren’t stimulating new demand, but are instead diverting existing customers from U.S. and other countries’ airlines to theirs. This has a very real, harmful impact on the United States — for every daily round-trip frequency lost or foregone to a subsidized Gulf carrier, 1,500 American jobs are lost.
So, while we’re upgrading America’s aviation infrastructure, we also need to protect the integrity of aviation operations by enforcing our Open Skies agreements. For decades, Open Skies have helped the American aviation industry flourish, letting U.S. airlines freely fly to 120 other countries without government interference and red tape. But these massive subsidies run completely counter to the core purpose of Open Skies — rather than remove government interference, the UAE and Qatar are heavily subsidizing their airlines. The point of having Open Skies is greater access, with a fair and equal opportunity to compete. Why should America accept heavy subsidies by our treaty partners that undermine competition?
President Trump is making it clear by his words and deeds that he expects American companies to be treated fairly under international trade agreements. He has also aggressively acted to protect U.S. jobs. No U.S. airline can be expected to compete with an entire nation’s oil-rich treasury. As we make sure our aviation infrastructure is able to support economic growth, we should also make sure our Open Skies agreements are working as intended.
• Jim Burnley served as the U.S. secretary of transportation under President Ronald Reagan from 1987 to 1989. He is a partner at Venable LLP and an adviser to American Airlines.
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