Airlines' Official Warns on Security Costs
THE NEW YORK TIMES - 27 Nov - WASHINGTON, Nov. 26 — The president of the airlines' trade association said today that unless the industry's problems are fixed soon, it might be necessary to nationalize the airlines.
Carol B. Hallett, president of the Air Transport Association, speaking at an industry luncheon, said that such a step would have costs that were "intolerable," but that the burden of security fees was destroying the airlines.
Fees that are supposedly charged to passengers are essentially paid by the airlines, she contended, because the surcharge imposed by the federal government that is supposed to pay for additional security prevents the airlines from charging more for tickets and therefore cuts into airlines' revenue. The government, she said, "must assume the full cost and responsibility for assuring protection of the aviation system against terrorist attacks."
She said the government "must reject the false premise that the airlines and their customers can or should bear this national defense burden."
Failing to fix the root causes of the industry's dire situation could mean that the nationalization of the industry becomes necessary, Ms. Hallett said.