Aeropolitics and Open Skies
24 Pages Posted: 14 Mar 2015
Date Written: March 12, 2015
In 1944, in Northwest Airlines, Inc. v. Minnesota, a case of first impression about the constitutional limitations upon state power to tax airplanes, Justice Robert H. Jackson wrote in a concurring opinion that, “[p]lanes do not wander about in the sky like vagrant clouds.” Rather, “[t]hey move only by federal permission, subject to federal inspection, in the hands of federally certified personnel and under an intricate system of federal commands.” Indeed, the “moment a ship taxies onto a runway it is caught up in an elaborate and detailed system of controls. It takes off only by instruction from the control tower, it travels on prescribed beams, it may be diverted from its intended landing, and it obeys signals and orders. Its privileges, rights, and protection, so far as transit is concerned, it owes to the Federal Government alone and not to any state government.” Concerns about how to design and manage the airways in the sky was not a concern for American jurists and lawmakers alone, but an international issue in the post-war 1940s.
The international aviation community came together on safety issues, but stipulations respecting economic issues — such as protocols allowing foreign airlines to fly wherever they wanted in the other’s territory, as frequently as they desired, and at prices they chose — were elusive. In place of a comprehensive arrangement for international airline operations, therefore, bilateral and multilateral agreements facilitated commercial air travel. But, then, deregulatory impulses eroded protectionist philosophies in the late 1980s and early 1990s as the United States and Europe and other nations and regions pursued “open skies” policies that liberalized wide swaths of international travel. While not entirely free to wander about the sky uncontrolled, airliners could go to more destinations, more regularly, and less expensively.
This article overviews the seminal issues of open sky policy, including antique laws of ownership and control. Also presented is a review of airline deregulation policy in the United States, argument in favor of the expansion of so-called cabotage rights allowing foreign carriers to fly domestic routes, and discussion of the emergence of strategic airline alliances. Finally, this article concludes with coverage of an intense controversy between major U.S. airlines, on the one hand, and Persian Gulf carriers, on the other hand, that risks open skies policies in the Middle East. In presenting these issues, this article aims to introduce the reader to the unusual and historically significant ways in which aviation laws are derived domestically and internationally, and in doing so, raise a general question about the welfare of aviation consumers overall. In conclusion, this article criticizes U.S. carriers seeking to reverse hard-won open skies policies. Indeed, the U.S. airline’s industry’s habit of looking to the government to get out of the way except when it comes to their own welfare is inconsistent with principles of free competition, avoids the real market-borne issue of product competition, and is hollow when asserted by carriers who have received substantial protections under U.S. bankruptcy law to survive in a global sector that should be performance — and not subsidy-based.
Keywords: open skies, Emirates, Qatar, airline, deregulation, Chicago convention, aviation
JEL Classification: D60, F10, F13, F14, H50, H56, H70, H77, K23, K33, L62, L93, L98, L91, N40, N45, R48
Suggested Citation: Suggested Citation