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For your own sake, avert your eyes...

...if you are still bored of politics and amazed that one could question how hot markets are.

I've heard it asserted before that the airline industry is an 11 or 12 figure money loser over aviation's history, and I find that easy to believe. I got the New York Observer for the 1st time in a few years this morning and there's a good article called There’s No Free Market At America’s Airports. I'm not sure if it's so horrible that transportation is so heavily publicly subsidized, but I do think it raises the question of what society would look like if not for massive collective investment in this area...
The airline industry has never drawn an unsubsidized breath. The development costs for passenger aircraft and their avionics have been paid for, directly or indirectly, as a national-defense gimmick for a century, and we will not even venture a guess as to what it would have cost the industry (even if it had had the money) to build the airports.

It's ineffecient, but if we were to halt the spending referenced above, or choose not to keep Delta/ Northwest in the air, etc. would our economy suffer because these things really are public goods? I kind of think so.

Also, these realities are why I tend to regard free market rhetoric as empty sloganeering (and I find it doubly frustrating how often it comes from politicians I regard as tax raising maniacs.)


At 3:27 PM, Blogger Ivan said...

You can't take subsidies in a vacuum. Regulation is also extremely imporant.

There is little free about airlines, though they are prety good about giving almost unlimited bad service for almost no cost.


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