Wednesday, March 21, 2007
Minnesota Congressman James Oberstar's chairmanship of the House Transportation and Infrastructure Committee fits him like a glove.
First elected in 1974, the powerful Democrat from Chisholm is the only member of the Minnesota delegation who was serving in Congress when the airline industry was deregulated in 1978. He can discuss the intricacies of transportation policy in English, French and Italian.
Armed with billions of dollars in federal funds, the 72-year-old Iron Ranger will be chief engineer of the nation's transportation system. A major part of that is aviation. He took the lead amid outcry for an airline passenger bill of rights after travelers were stuck on grounded planes and a brewing fight over how to finance the nation's air traffic control system.
The Pioneer Press recently talked with Oberstar about a variety of aviation issues. Here's a transcript of the conversation, edited for length and clarity.
Q. You've watched Eagan-based Northwest Airlines go through many changes over the years. What do you see as its crucial next steps?
A. Northwest emerging from bankruptcy. I think they have a good plan. Northwest let some union groups sell part of their bankruptcy claims and agreed to give its employees holding preferred shares a $277 million unsecured bankruptcy claim. It froze retirement plans but didn't turn them over to the Pension Benefit Guaranty Corp. Those were positive steps.
Q. Do you think Northwest eventually will merge with another airline?
A. There's always the possibility of doing so. I'm very watchful and mistrustful of mergers. In the end, they reduce competition and choices for travelers. I don't think it's in the best public interest to let mergers proceed. The best example of that is the recent US Airways proposed hostile takeover of Delta Air Lines, which would have reduced competition and airfares would have risen. The same thing would happen with Northwest. If someone bought Northwest they wouldn't have any interest in International Falls or Thief River Falls. Northwest should focus on emerging from bankruptcy as soon as possible. As a stand-alone company, they can fend off merger talks. In bankruptcy, you're in a very vulnerable position.
Q. Do you predict mergers are imminent industrywide?
A. It has quieted down since the US Airways-Delta proposal, which I opposed. I don't think there's a merger mania ricocheting through the industry.
Q. You've been an outspoken critic about aviation outsourcing. What are your concerns and suggestions?
A. There's been more outsourcing and a diminished capacity of the Federal Aviation Administration to oversee it. Foreign operators in places such as El Salvador and Mexico can have a whole maintenance crew that aren't U.S. airframe and powerplant certified as long as the FAA-certified supervisor signs off on it. We've seen questionable and sometimes shoddy maintenance work being done. Look at JetBlue, which ships its Airbus 320 fleet to El Salvador for maintenance work. The FAA's oversight office for El Salvador is in Miami. That's not like being right there in the back yard. We're going to have hearings on outsourcing.
Q. Do you support the proposed Open Skies agreement, which would reduce restrictions between the United States and Europe?
A. I oppose the current Open Skies proposal. I want to ensure this agreement does not lead to a greater foreign control of U.S. airlines. Decisions would be made far away from us about which U.S. markets would be serviced.
Q. What could Open Skies mean for Northwest?
A. What's important for Northwest is antitrust immunity for its alliance with Air France/KLM. The U.S. Transportation Department has rejected that request before. When the European Union makes a decision about the Open Skies proposal this week, it could be a good opportunity for Air France to request antitrust immunity.
Q. How do you balance the needs of your home state with national and international interests?
A. Work harder. Put in more hours. I only had the aviation children in the past and now I have all of the transportation children. I was the ranking Democrat on the committee, but it's different as chairman. Now, I tell people you're not sending your lobbyists to see me, send your CEOs. If you want to talk to me, I want to look you in the eye. I've met with Northwest Airlines' CEO Doug Steenland, JetBlue Airways' CEO David Neeleman, American Airlines' CEO Gerard Arpey and some railroad CEOs.