AIRLINE TREMORS

by Bernie Lopez

After 911, the global airline industry went into a tailspin, and just as the dust was beginning to settle, a new tornado suddenly blew.

 

911 was the absolute catalyst. The day after 911, airports all over America and Europe were clogged up due to security reasons. At the Los Angeles airport, a Filipino balikbayan reported that he had to go down a few kilometers from the airport, walk with all his balikbayan boxes, only to have them stripped down to the toothbrush level, and only to find out he could not leave, not in the next few days, so he went home anyway and finished half a bottle of Black Label to calm his nerves down. In fear of terrorism, there was an obsession for over-security which left the airlines in shambles. Nothing was the same anymore in the commercial skies after the Twin Towers of Manhattan took the same fate as the twin towers of Babel two thousands years ago. The coincidence was biblically mind-boggling.

 

Security procedures disrupted the flow of airline traffic. There were less flights, less passengers, less profits. The strategy of the airlines in order to recover was to downsize, rely on smaller planes with smaller volume of passengers. That way, they could match logistics against passenger volume, and reduce overhead on big airplanes half or a third full. It worked but there were repercussions.

 

For one, more planes, small and big, meant more pilots. There ensued a serious shortage of pilots worldwide. The best Filipino pilots suddenly disappeared, offered by Middle East and Asian airlines lucrative salaries three to ten times their current pay.

 

Philippine Airlines (PAL) felt the crunch and was going into a crisis level. You cannot fast track producing good pilots because it takes years of training and flying hours to mold these ace pilots. I told PAL there were Saudi investors I knew, whose pockets were overflowing with petro-dollars, and who might be interested in a joint venture to built an international pilot school in Clark. I was ignored.

 

And as the first tornado died down, a second one ensued quite recently, a triple-whammy. First whammy was spiralling oil prices hitting the century mark ($100 per barrel) pushing airfares up to unprecedented levels. Again, there were less passengers and less profits. Delta and United, local US airlines which were hardest hit, are now negotiating for a merger. This implies laying off thousands as a solution to mounting overheads.

 

Second whammy was a former employee of the US Federal Aviation Authority (FAA) testifying that there were massive safety anomalies in key local US airlines. As a result, 2,000 flights were delayed within two days in just two local US airports.

 

Third whammy was the announcement by key US economists saying that a US recession was not arriving but has arrived, partly triggered by the credit crunch due to the subprime mortgage crisis worldwide which resulted in a tailspin in global stock exchanges.

 

The airline mergers may see a reversal back to the bigger planes, which will result in a glut of unemployed pilots from the era of shortage. Whatever the tremors that rock the global airline industry, one thing is for sure, out of the rubble will emerge the survivors because this demand-driven industry will necessarily separate the airline sheep from the goats.

FOOD SECURITY STRATEGY

 

At the top of the list of measures to insure food security is to streamline the availability and easy access of credit to marginal fishermen and farmers who comprise the bulk of our food production.

 

Second is for the government to abolish taxes on oil and on food. The government cannot forever increase deficit spending and think all the ingenious tax revenue plans will solve its over-spending. Belt tightening is now a must for government if it wants food security to be properly addressed. The reason America is a superpower is it has one of the lowest cost of gasoline which fuels industrial and economic growth. Taxes inhibit economic growth and encourage government over-spending. Our price for gasoline is so high, almost double of that in the US at one time in the past.

 

Third, our agricultural agencies are infested with corruption. An anti-corruption drive, if that is possible, will definitely do well to attain food security. The Fair Trade Alliance (FTA) says our food crisis is man-made, not just a product of global shortages. We have the land resources to produce. What we do not have is credit for food producers and government incentives for more food production. We have an agricultural economy. Agriculture dominates our growth as a nation. Agriculture insures the survival of marginals who comprise more than half of the country. There is no excuse that we cannot produce our own food.

 

Fourth and last, we must stop giving agricultural lands to foreigners like the Chinese and we must prioritize food over non-food agricultural productions even if the latter bring in better profits.

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