Securing the Airways
The downside to solidarity.

By Jonathan Klick, a research fellow at the Mercatus Center at George Mason University and a Robert A. Levy Fellow in Law and Liberty at GMU School of Law.
October 11, 2001 11:45 a.m.

merican unity has been one of the unintended consequences of the terrorist attacks in New York City and in the nation's capital. Although that unity is starting to dissipate as we return to normalcy, America is a much less divided nation now than it was one month ago. While this has generated enormous benefits on charitable fronts, it has also created an artificial and potentially dangerous homogeneity on the political front, as individuals seek some remedy — any remedy — to all that went wrong on September 11.

Although all Americans shared in the national tragedy that unfolded at the World Trade Center, the Pentagon, and in southwestern Pennsylvania, we should not all share an equal burden in fixing what went wrong that day.

Specifically, spreading the costs of securing the nation's airports among all taxpayers is a fundamentally inefficient and inequitable course of action. Yet, because of our new solidarity, there has been little outcry against the suggestion that airport security should be federalized through the creation of a new agency — an agency that would likely add tens of thousands of people to the federal payroll to screen bags and passengers at airports, and that would cost nearly $2 billion, according to Transportation Secretary Norman Y. Mineta.

While none of us wants to see events like those of September 11 repeated, it is difficult to justify a situation in which fliers and non-fliers alike would be taxed to provide a service that primarily benefits the first group. Further, in an industry in which nearly 93 percent of revenue-generating capacity last year operated out of major airports (99 percent out of major and national airports), it is difficult to argue that the benefits of the proposed federalization would be well distributed throughout the country. Patriotism and concern for America do not warrant that these facts be ignored. In fact, the principles of federalism demand that they be recognized.

The federal government can play a useful — though limited — role by setting minimum safety standards, collecting and disseminating information on the best practices and available technology, and monitoring the airlines to ensure that the safety standards are met. But it should not be in the business of running the security operations at our nation's airports.

With the federal government filling only a limited role, airlines and customers would be able to decide what form the increased safety costs will take. Some airlines may choose to hire more inspectors and buy more sophisticated technology, in order to meet the required safety level with little inconvenience and lost time in the inspection process. Bargain airlines, on the other hand, may choose to keep their price advantage by relying on more time-consuming, but equally effective, inspections. In this way, the costs of increased safety would be placed with their beneficiaries, without resulting in the loss of consumer choice that would likely accompany a simple airplane ticket tax. Forcing one-size-fits-all policies on the industry and its customers will rob consumers of this choice — without guaranteeing them a safer product.

Such a ticket tax is included in the airport-security legislation proposed by Senators Ernest F. Hollings (D., S.C.) and John McCain (R., Ariz.). Though the proposal notes that much of the federalized security can be paid for with only a $1 per ticket tax, this estimate assumes no decrease in the nation's air travel relative to the year 2000 level. Given the reduction in demand the industry is likely to face for some time to come, this tax will have to be revised upward substantially or else taxpayers will be left with the bill. By reducing the price gap between low-cost and higher-cost airlines, such a tax would undoubtedly harm those carriers that have been successful in providing frugal consumers the product they desire. It's the airlines that know their customers best; they are in the best position to customize procedures to remain attractive to the consumer, while still meeting the highest standards of safety. While the federal government does not have a proven competence in meeting the goals of either consumer satisfaction or safety, it could serve important roles as a source of information and as a third-party check that the airlines do not fall below the required security minimums. By imposing fines and informing the public of any airline misconduct, the federal government could oversee the safety of the nation' s air travel — without suddenly becoming the airlines' police force.

In the wake of a tragedy of truly national proportions, it is comforting to see America presenting a unified front — but that unity is not a green light for policy makers to ignore the principles of good government and simple economics. Federalizing airport security is a bad idea, motivated by emotion rather than common sense.