Thread by @doctorow

Christmas's apocalyptic airline meltdown stranded thousands, ruining vacations and costing fliers a fortune. It wasn't just #SouthwestAirlines' meltdown - as stranded fliers sought alternatives, airlines like #AA raised the price of some domestic coach tickets over $10K. 1/

If you'd like an essay-formatted version of this thread to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:

pluralistic.net/2023/01/10/the… 2/

This didn't come out of nowhere. Southwest's growth strategy has seen the airlines add more planes and routes without a comparable investment in back-end systems, including crew scheduling systems. 3/

SWA's unions have spent years warning the public that their employer's #ITInfrastructure was one crisis away from total collapse.

But successive administrations have failed to act on those warnings. 4/

Under #Obama and #Trump, the DoT was content to let "the market" discipline the #monopoly carriers, though both administrations were happy to wave through anticompetitive mergers that weakened the power of markets to provide that discipline. 5/

Obama waved through the United/Continental merger and the Southwest/AirTran merger, while Trump waved through Virgin/Alaska.

While these firms were allowed to privatize their gains, Uncle Sucker paid for their losses. 6/

Trump handed the airlines $54 billion in #CovidRelief, which the airlines squandered on #StockBuybacks and #ExecutiveBonuses, while gutting their own employee rosters with early retirement buyouts:

bloomberg.com/opinion/articl… 7/

Incredibly, the airlines got even worse under the #Biden administration. In the first half of 2022, US airlines cancelled more flights than they had in all of 2021. 8/

Meanwhile, the airlines increased their profits by 45% - and kept it, rather than using it to pay back the $10b in unpaid refunds they owed to fliers:

economicliberties.us/press-release/… 9/

Dozens of state attorneys general - Republicans and Democrats - wrote to Transportation Secretary #PeteButtigieg, *begging* him to take action on the airlines. After months without action, they wrote *again*, just days before the Christmas meltdown:

levernews.com/state-official… 10/

For his part, Buttigieg claimed to be doing all he could, trumpeting the refund order fliers as evidence of his muscular regulatory approach (recall: these refunds havne't been paid). He assured us the situation "is going to get better by the holidays." 11/

12/

But the numbers tell the tale. Under Buttigieg, the DOT "issued fewer enforcement orders in 2021 than in any single year of the Trump and Obama administrations."

economicliberties.us/press-release/… 13/

As the crisis raged, enraged fliers and opponents of unchecked corporate power blamed Buttigieg. So did opportunistic, bad-faith Republicans looking to score political points. 14/

The "liberal" media lumped all this criticism together, insisting that Buttigieg had done everything in his power and declaring it unreasonable to expect the Transport Secretary to prevent transportation catastrophes:

levernews.com/the-partisan-g… 15/

Buttigieg's defenders trotted out a laundry list of excuses for the failure, nonsensical to the implausible to the contradictory - continuing to blame weather for the meltdown, even after Buttigieg himself went on national TV to say it wasn't:

https://twitter.com/GMA/status/1608075800254767105?s=20&t=wmaJq3OWU0r0e6TS9V-9sA

16/

Buttigieg runs a powerful administrative agency and has broad powers. Neither he nor his predecessors had the courage to wield power, all evincing a kind of #LearnedHelplessness against industry lobbying. There's a difference between *being* powerless and *acting* powerless. 17/

To see what a fully operational battle-station looks like, cast your eye upon @linakhanFTC, chair of the @FTC, another agency that has a long history of dormancy in the face of corporate power, but which Khan has transformed - not through ideology, but through *competence*. 18/

Khan - and her fellow Biden administration trustbusters Jonathan Kantor and the recently departed @superwuster - have an encyclopedic knowledge of their powers, and they haven't been shy about using them:

pluralistic.net/2022/10/18/adm… 19/

Even as the airline industry was stranding Americans far from their families, Khan proposed a rule to ban #NoncompeteAgreements, widely used to prevent low-waged workers like fast-food cashiers from quitting and seeking better pay from competitors:

mattstoller.substack.com/p/antitrust-en… 20/

These are, as @matthewstoller writes, a form of indentured servitude, used by private equity crooks to lock in their workforces. "30% of hair stylists works under a non-compete, as do 45% of family physicians." 21/

Noncompetes destroy the livelihoods of workers who start their own businesses, too: "One comment to the FTC came from a graphic designers for signage who was bankrupted by a lawsuit from her control-hungry former boss and a small town judge":

regulations.gov/comment/FTC-20… 22/

Noncompetes are a scourge, and there should be bipartisan agreement on this. If you're a Democrat who believes in labor rights, noncompetes are manifestly unfair. But that's also true if you're a Republican who believes in competition and the power of entrepreneurship. 23/

Nevertheless, noncompetes have trundled on, with neither Congress nor the administrative branch showing the courage to act - until now. 24/

Khan's proposed rule bypasses Congressional inaction by invoking powers that she already has, under #Section5 of the #FederalTradeCommissionAct. 25/

Sec5 gives the FTC broad powers to prohibit "unfair methods of competition" - incredibly broad power, with the FTC hasn't bothered to use since the 1970s (!):

casetext.com/case/national-… 26/

Which brings me back to Secretary Buttigieg and the airlines. Because Chair Khan isn't the only federal regulator with these broad powers. As @ddayen writes for @TheProspect, "the Department of Transportation has the exact same authority":

prospect.org/infrastructure… 27/

Under USC40 #Section41712a, Buttigieg has the power to unilaterally ban transportation industry practices that are "unfair and deceptive" or "unfair methods of competition." 28/

Per the DOT's own guidance, this provision is "modeled on Section 5 of the Federal Trade Commission Act":

govinfo.gov/content/pkg/US… 29/

The are a lot more recent examples of the DOT using this power than there are of the FTC using its Section 5 authority, like the #TarmacDelayRule. 30/

But as @rkuttnerwrites writes, the airlines reneged on their end of the $54b bailout, slashing staffing levels and failing to invest in IT modernization - examples of the "unfair and deceptive" practices that the DOT could intervene to prevent:

prospect.org/infrastructure… 31/

As Dayen writes, "The definition of 'deceptive' is 'likely to mislead a consumer, acting reasonably under the circumstances.' 32/

"If the airline scheduled a flight, took money for the flight, and knew it would have to cancel it (or, if you prefer, knew it would have to cancel some flights, all of which it took money for), that seems plainly deceptive." 33/

This is the same authority that Buttigieg used to fine 5 non-US airlines (and Frontier, the tiny US carrier that flies 2% of domestic routes) for cancelling their flights - his signature achievement to date. 34/

But as Dayen points out, this authority isn't limited to taking action after the fact.

The DOT can - and should - act *before* Americans' flights are canceled. 35/

It can use its authority under 41712(a) to "say that the cancellation itself is an unfair and deceptive practice and issue a fine for each canceled flight." 36/

It could "promulgate a rule saying that cancellations due to insufficient crews, or due to dysfunctional computer scheduling systems, are unfair and deceptive, with stiff fines for each violation." 37/

Both of these were within Buttigieg's power months ago, when the State AGs begged him to take action to prevent the mounting epidemic of cancellations. Both of these are within his power now. 38/

Heads of federal agencies are among the most powerful people in the *world* and they can *use* that power to materially improve the lives of the American people.

Just ask Lina Khan. 39/

Image:
Gage Skidmore (modified)
flickr.com/photos/gageski…

CC BY-SA 2.0
creativecommons.org/licenses/by-sa… 40/