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Why airlines are happy settling for stability after high hopes at start of Trump administration

With Congress putting the finishing touches last week on a sweeping aviation policy and spending bill, airlines’ lofty aspirations have largely been grounded.

On Feb. 9, 2017, CEOs from the country’s largest airlines met with President Donald Trump at the White House, optimistic about advancing several of their priorities — from air traffic control reform to cracking down on unfair foreign competition — under the new administration.

Twenty months later, with Congress putting the finishing touches last week on a sweeping aviation policy and spending bill, airlines’ lofty aspirations have largely been grounded.

The bipartisan five-year bill’s defining feature is the stability and consistency it will provide to the aviation industry after years of repeated short-term extensions that accomplished little beyond keeping the lights on at the Federal Aviation Administration and other federal agencies like the Transportation Security Administration.

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“This provides five years of stable funding and the ability for the administration to really invest in its programs without concern about the next reauthorization bill,” said Paul Lewis, vice president of policy at the nonprofit Eno Center for Transportation. “In terms of policy, there are a few changes, but nothing super-dramatic.”

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The result is a muted victory, one that stands in contrast to the major wins scored by the oil and gas business, the telecom sector and other industries amid a deregulatory gusher opened by Trump.

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While the legislation failed to advance the airline industry's long-held goal of spinning off the country’s air traffic control system from the FAA into a private, nonprofit corporation, several other provisions loathed by airline executives didn’t make it into the final bill.

Those included a call to regulate fees for things like checked bags and seat assignments, as well as a push to increase the cap on airport fees used to fund construction. In their place are a number of smaller changes, covering issues from pets to cellphone calls to airplane seat sizes.

It's not the dramatic action that, just last year, seemed to have the political winds at its back.

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“I’m disappointed that with a Republican Congress and a Republican administration, we didn’t make better progress with the FAA reform,” Southwest Airlines CEO Gary Kelly said recently, referring to the air traffic control privatization push.

Carriers haven't come up totally empty-handed in the Trump era, as they have joined other businesses in enjoying steep tax cuts passed last year.

Airlines have also praised the Trump administration for brokering an agreement calling for more transparency from three Middle Eastern carriers that some U.S. airlines have said receive unfair subsidies from their home countries. But even that success has been limited in scope, with American Airlines CEO Doug Parker suggesting last month that one of the carriers was already “cheating” on the non-binding agreement.

Airlines in D.C.

Mere passage of an FAA reauthorization bill, which was signed into law by Trump on Friday, is also no small achievement.

The legislation has drawn broad support from across the aviation industry, including commercial airlines, their employees, general aviation operators and safety groups. Even consumer watchdogs found things to like in the final package, despite their calls for further passenger protections.

The new rules prohibit putting pets in overhead bins, ban cellphone calls in the cabin and prod the FAA to set minimum sizes for seats. The bill also touches on broader aviation issues, including continued work on integrating unmanned drones into the national airspace.

The bill's overall shape shows the aviation sector is a serious player in Washington. It's spent more than $46 million on lobbying and nearly $7 million on political action committee donations to candidates so far this year, according to the Center for Responsive Politics.

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But the months spent playing defense against various proposals to re-regulate aspects of the industry, and the fact that their top priority of air traffic control reform failed to get a floor vote  in the House or Senate, highlight the challenges airlines and their lobbyists face on Capitol Hill.

Any number of factors might explain that turbulence.

Despite efforts by airlines to convey their story of improved operating performance and increasing customer satisfaction in a new era of profitability, that goodwill can be easily punctured by a single viral video of a customer mishap.

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Take the push to privatize air traffic control.

Just as airlines were gathering legislative momentum in Washington in mid-2017, the industry was rocked by a clip of United Airlines customer being dragged off a plane.

Congress responded by bringing top airline executives to Capitol Hill for a public grilling, and although that moment alone didn’t doom the privatization push, it didn’t help, either, with the industry spending months repairing its image.

The air traffic control reform effort also struggled with the fact that the aviation industry remains divided on the issue. Those splits run along several fault lines, but the rancor between passenger airlines and general aviation, a group that includes private jets, prevented a unified front.

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Lewis, of the Eno Center, said the effort also failed to generate public enthusiasm to change a system that’s remarkably safe, even as supporters of reform say change is needed to help reduce congestion in the crowded skies.

“I suspect few fliers understand the current system. ... There’s no problem per se other than advancing toward a higher-tech system isn’t going very quickly and the cost of operating that system could potentially be lower,” said Lewis, whose organization has backed calls for air traffic reform. “Those two problems are hard to rally support behind.”

Another dynamic faced by airlines is the reality that nearly every lawmaker flies to and from Washington just about every week, giving them a level of self-fashioned expertise on air travel that simply doesn’t exist for, say, the science behind fracking or the "internet of things."

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“We’re an important product for consumers,” American’s Parker said in September. “That includes members of Congress who fly a lot and includes all of their constituents.”

The path ahead

In addition to ensuring stable funding and consistent policy for the next five years, the recently passed FAA bill gives the airline industry a measure of political insulation.

The November elections could usher in new congressional leaders with their own set of priorities and concerns. At the very least, airlines will no longer have retiring Pennsylvania Rep. Bill Shuster in their corner. The Republican has been a champion of air traffic control reform for several years in his role as chair of the House transportation committee.

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With the course largely charted for the next five years, airlines will have plenty of time to regroup and refine their pitch on air traffic control reform and any other issues that arise between now and 2023.

“The FAA bill is really the vehicle in which to do [air traffic control reform],” said Lewis. “It took such effort from Congress to put together a five-year bill that reopening that for renegotiation midway through just isn’t going to be a priority.”