Congressman LaHood and the Department of Transportation

During his career in the U.S. House of Representatives Congressman LaHood had a reputation for approaching public problems with an open and pragmatic mind.  I am confident that this attitude will translate into a willingness to consider significant reform in the transportation sector during his leadership of U.S. Department of Transportation.  Many necessary changes can only come through legislative action, but DOT can undertake administrative and regulatory changes to promote greater linkages between transportation policy, economic growth and competitiveness, energy security, and climate change. Addressing these issues, which are deeply interwoven with transportation policy areas, is essential in developing a forward-looking federal vision – and DOT can play an important role in this task.

There are a number of steps DOT can begin today to reform the system. Perhaps the most dramatic might be a reorganization of DOT’s structure along functional, rather than modal, lines. The leading example of such a departmental restructuring comes from the United Kingdom. The goal is to better align priorities, objectives, and process while reducing inefficiency and providing incentives for success. A restructuring would help clarify and consolidate the grant-making agencies within the DOT (like merging the highway and transit agencies into one) and the more regulatory-oriented agencies that deal with goals like safety. Within the limits of existing statute, the new Secretary might consider a reorganization of DOT around national goals and purposes, such as transportation in metropolitan regions, major trade and goods movement corridors, and intercity passenger connectivity.  In addition, the new Secretary might undertake – again, within existing law – a consolidation of the Department’s regulatory activities that deal with goals like safety.

DOT can lead in other areas as well. In focusing on energy security and environmental goals, Cong. LaHood, as Secretary, should begin the process of further increases in CAFE standards for all classes of vehicles and should direct DOT’s operating agencies to develop guidance to state, local, and metropolitan agencies that will encourage genuine strategic transportation planning and linkages between transportation, economic growth, energy, and climate change at those levels. To improve operations DOT can take action to enhance the role and capacity of the Bureau of Transportation Statistics to collect data critical to insuring performance and accountability; without better data it is hard to develop accountability much less set goals. DOT can also move to put a greater emphasis on operating improvements and restoration of existing assets and, to the extent possible under existing law, using DOT programs and authority to allow state and local governments to utilize pricing in the management of systems. 

Even if all of these goals cannot be fully accomplished in the next few years, a DOT focused on opportunistically moving the ball forward when possible will help to ensure that critical long-term concerns are advanced.

Airport Pricing at New York's Airports

Yesterday brought news that the US Department of Transportation is moving forward with a plan to auction off up to 10% of the takeoff and landing spots at New York’s three busiest airports: JFK, LaGuardia, and Newark. Essentially, the DOT intends to cap the number of flights at the airports to increase on-time operations (too many flights can lead to major backups when problems arise) and auction some of the slots (all of which are currently free) to ensure that they are used by the airlines that value them most. In response, there has been an immediate outcry from airlines, the Port Authority, and some politicians all claiming that the DOT is overstepping its authority and that the plan will raise fares at the airports. Other options like more runways and better air-traffic control technology exist to improve on-time operations, but proper pricing seems like an important and valuable part of any proposal. In fact, pricing may work better in the long term than these other options: you cannot increase capacity forever, and technology improvements will eventually yield ever-smaller gains.

To elaborate, it should be noted that while the New York airports are important because of the large market they serve, they are also deeply interconnected to a broader national air and ground transportation system. Improving the performance of these three airports is crucial because their backups cause roughly two-thirds of flight delays around the country. The DOT believes the auction plan will cut flight delays at LaGuardia by 40%, which will create positive impacts felt around the nation. (For a neat map of global plane traffic check this out.)

There are obvious complexities to properly pricing airports, especially involving equity issues like ensuring flights to small markets (a 747 flight to Los Angeles with hundreds of passengers on-board can pay more for a flight slot than a small plane headed for upstate New York), and a large cause of air-congestion is weather related, not due to capacity constraints. But at airports facing capacity-based congestion problems, the pricing of slots or of certain routes will likely yield benefits – especially if pursued in conjunction with an integrated ground transportation policy. For example, one way New York could ease congestion is by reducing the numerous flights to Boston and Washington, DC, via a better and faster train system to connect the cities.

There are major political problems to implementing pricing at airports, and it is unclear if the DOT plan will be implemented in the end. But the fact is that flight congestion and delay is a major problem that imposes high costs on passengers. Solutions are needed. Technology improvements, capacity additions, effective pricing, and a more integrated air and land transportation system are all important parts of a comprehensive answer. Yet each of those pieces also has some merit standing alone. Given that a comprehensive solution seems unlikely any time soon, the question becomes whether a partial solution is better than nothing at all.

-Daniel Lewis