Does Spirit Airlines Have a Soul?

There has been a lot of righteous indignation displayed by government officials (primarily by U.S. senators and Department of Transportation Secretary Ray LaHood) over the proposal by Spirit Airlines to charge passengers for carry-on bags.  Specifically, Spirit Airlines has said that it will charge $45 for carry-on luggage using the overhead bins.  Some of the responses are almost comical:

“We are going from the sublime to the ridiculous with airlines,” Sen. Frank R. Lautenberg (D-N.J.) said at a news conference last week in Washington.

Sen. Charles E. Schumer (D-N.Y.) called the fee a “slap in the face to travelers.” Sen. Jeanne Shaheen (D-N.H.) called it “skyway robbery.”

The lawmakers hope to put the kibosh on the fee by imposing a tax on all airline revenue collected from such charges.

I’m not a frequent flyer, but I’ve flown enough to recognize that baggage fees have created a big problem with boarding airplanes.  In the era of the checked baggage fee people have chosen to cram everything into a carry-on.  Of course, when everyone brings a full-sized carry-on there is not enough room in the overhead bins for all the passenger luggage and the airline inevitably spends a lot of time placing carry-on bags in.

So, to combat that Spirit Airlines has instituted a carry-on bag fee.  What has been glossed over is that Spirit is merely providing incentive for passengers to check their bags in the first place rather than carrying them on.  The first checked bag will only cost $25 if checked online before arriving at the airport ($20 less than for a potentially smaller carry-on).  Therefore Spirit is merely making the carry-on a luxury and giving reason for people to check their luggage.  Oh my!  Senators are really upset that flights will run more smoothly and that Spirit may actually assist with difficulty of TSA security checks?

Jeff Jacoby of the Boston Globe looks at this issue from a free market perspective.

But if [Senator Charles] Schumer grieves so deeply about travelers being “nickeled and dimed’’ when they fly, why has he never gone after the US ticket tax, which adds 7.5 percent to the price of every domestic flight? Or the $16.50 the federal government charges for each international departure and arrival? Or the $17 in customs and inspection fees paid by passengers flying into US airports from abroad? Or the “passenger facilities charges’’ (up to $18 per round-trip)? Or the “US Security Service Fee’’ ($2.50 per departure)? Or the “domestic segment fee’’ ($3.70 per flight segment)? The government’s unremitting “nickeling and diming’’ of airline passengers doesn’t trouble the sleep of New York’s senior senator. Only when a private firm acts does he toss and turn in anguish.

Reality check: Every airline charges for its overhead bins, just as every airline charges for bathrooms, oxygen masks, and flight attendants. The cost of those amenities is built into the fare you pay when you fly, and you pay whether you use them or not. The same used to be true of the “free’’ meals, pillows, and baggage handling airlines provided, before they unbundled those services, made them optional, and began charging for them separately. Spirit, an ultra-low cost carrier that describes itself as “the unbundling leader in the industry,’’ has decided to do the same for carry-on luggage, simultaneously reducing its base fares by $40 or more each way. …

Is Spirit’s strategy a good one? The free market can answer that question faster and more accurately than any one of us can. The less assistance it gets from grandstanding senators and transportation secretaries, the better off all travelers will be.

I agree that politicians have found a pinata not worthy of their attack, especially given that Spirit Airlines has less than 3% of the US market share for airlines.

 

Recessions are Cruel to Transit

Post #100 on the Transit Pass!

It is not news that economic downturns are particularly hard on transit, just like all government services.  At the moment that affordable government services and assistance are most needed is also the time when government can least afford to provide them.

The voters of New Jersey reap what they sow.  They dumped their CEO-governor Jon Corzine for the Republican challenger who promised the unattainable Holy Grail of New Jersey politics, lower property taxes.  Now in office, Chris Christie has dealt with New Jersey’s budget deficit by cutting services and refusing to raise taxes, on anyone.  Of course, when you don’t raise taxes you can still effectively tax many people by offering fewer governmental services.  Therefore, Joe Millionaire is barely affected by the situation but Jane Minimum-Wage is put into an even more difficult situation because suddenly day care, transit, health care, etc. are less available and more expensive.  Perhaps that is good politics for a Republican, but it is certainly bad governance.

Governor Chris Christie in February said he would cut the state’s $296 million annual subsidy for NJ Transit by 11 percent, or $33 million, to help close a $2.2 billion deficit in the state budget for the fiscal year ending June 30. Christie, 47, a Republican who took office in January on a pledge not to raise taxes, introduced a $29.3 billion budget last month that contains $10 billion in spending reductions.

Christie, in a March 17 interview, said “there’s no way to fix” NJ Transit’s budget woes without raising fares. The governor also said he supported increasing transit fees over putting tolls on free roads in New Jersey including Interstates 78, 80, 195 and 295.

Specifically, Christie has cut NJ Transit’s funding by 11%.  In response, NJ Transit has been forced to raise fares; increasing the cost of local bus and light rail travel by 10% and commuter bus and train travel by a hefty 25%.  I used NJ Transit’s commuter rail for a full year when I worked in New York.  At that time my 35-40 minute ride cost $198 for a monthly pass.  While most people in my hometown probably can absorb the 25% increase without too much difficulty.  However, along the same route are a number of towns with poorer towns, such as Paterson (median 2000 household income: $32,778) and Garfield (median 2000 household income: $42,748), where the residents will have much greater difficulty absorbing such a fare hike.

A monthly pass from Paterson to New York Penn Station is currently $166.  A 25% hike will bring that price to $207.50, or an extra $498 a year, and that does not even include the costs of a monthly pass for the bus or subway in New York City, given that most jobs are not within walking distance of Penn Station.  With the price of a subway pass included a person from Paterson could be required to spend $3,450 a year for transit.  That is simply outrageous when your household income is $32,778.

Governor Christie hasn’t lowered taxes, he has impaired the rights of people throughout the state to procure employment and provide effectively for their families.  For the sake of saving some very wealthy residents the pain of having to pay a a little more in income tax the lower class has been implicitly taxed by virtue of being poor.  Transit justice exists and this is not it.  Governor Christie lacks that sense of empathy that Obama has been smeared for.  He has prioritized the needs of suburban drivers over transit commuters, continuing our history of poor transit priorities.

 

Train Operator Saves Passenger

Last week’s SEPTA strike was deeply unsettling to me and momentarily made me rethink my approach toward transit workers.  However, even if the SEPTA workers were greedy and stubborn, I still believe we should appreciate those who get us from here to there and back.

In particular, we should all be thanking Charice Lewis who operates an Orange Line train for the MBTA in Boston.  On Friday night Lewis managed to pull her emergency break in time to save the life of a passenger who drunkenly stumbled onto the track (the picture above has a link to more photos and the article linked to has video).

The fact that this train stopped is a minor miracle.  The passenger fell off at the front of the platform such that the train had the least amount of time to stop.  Of course the woman who fell off the platform had been drinking for several hours prior.  She managed to survive with just scraped knees.  While the operator should be heralded, the passengers who took care to wave down the train should also be congratulated.  Though it is not quite as impressive as the man who jumped into the NYC subway in 2007 to save another man’s life.

So, thank your public transportation drivers, they are critical to your movement and routine, and just might save your life.  Oh, and please stand behind the yellow line!

 

Warren Buffett Gambles on Trains

The biggest railroad news in a while occurred yesterday when it was announced that Warren Buffett and Berkshire Hathaway were purchasing BNSF (Burlington Northern Santa Fe).  Buffett agreed to purchase the 77.4% of the company that he did not already own for $26 billion.

BNSF, which is a relatively new railroad as an entity, is actually a combination of many older railroads including the Burlington Northern and the Santa Fe.  The railroad covers 32,000 miles of track, 6,700 locomotives and 220,000 freight cars.  The company’s biggest clients are coal and agricultural product shippers.

That begs the question of why Buffett made the investment.  Is he betting on trains, coal, industrial agriculture, or all of the above?  Streetsblog’s Elana Schor takes a swing at that question:

That environmental rationale for Buffett’s deal struck some in Washington as dubious. Frank O’Donnell, president of the green group Clean Air Watch, wrote on his website that the BNSF deal was “the biggest climate story of the day,” bigger even than the political maneuverings of the Senate environment committee:

This is a $34 billion dollar bet that coal will remain the centerpiece of American energy policy in the future. Buffett clearly believes that coal use will remain strong – and possibly grow. So he is putting his money on a vision of America with no effective climate policy at all – or at least one that doesn’t slow coal growth.

BNSF’s reliance on coal is indisputable; the black stuff has accounted for nearly half of its tonnage this year, and MarketWatch estimates that 10 percent of U.S. electricity comes from coal hauled by the railroad.

As coal-hauling railroads go, however, BNSF has made an attempt to distinguish itself on the energy efficiency end. The railroad is developing an emissions-free hydrogen-powered locomotive, and in May started to test-run a group of GE locomotives that cuts emissions by 40 percent over previous, dirtier models.

My take (and part of Elana’s) is this purchase is a good thing.  I personally don’t care if Buffett is invested in coal – because it is admittedly not going anywhere any time soon – because Buffett will be invested in transportation and rail infrastructure.  He will be invested in making the rail infrastructure solid, having working trains and hopefully growing the network.

Passenger transportation gets the most news coverage, but freight transportation is equally important.  The effect of truck freight transportation on roads and the environment is well documented.  Moving more of our freight to rails is good for everyone, including driver safety and those living close to highways.

Moreover, maintaining high quality rail corridors is also good for passenger rail as Amtrak and many public transit commuter rail systems already run on freight-owned rails.  Expanding networks is good for the future of commuter and inter-city rail too.

Good for Buffett in seeing that America’s transportation future lies on the tracks, not on its asphalt roads.

 

SEPTA Strikes: 450,000 People Look For a Ride

Well, it happened.  The Phillies staved off elimination in the World Series against the Yankees.  Barely before the dust from the fireworks had settled in the parking lot of Citizens Bank Park the transportation workers’ union did the inevitable, they started to strike.

They strike is based on struggling contract negotiations.  I’ll let the Philadelphia Inquirer explain fully:

Rendell said the union chose to walk away from an “excellent” contract offer that includes 11 percent in wage increases over five years, and 11 percent increase in pension contributions, and no increases in workers’ contribution for health care.

“Think about that,” Rendell said. “Whose pension has been increased in this day and age?”

According to TWU officials, SEPTA management has proposed no wage increase for the first two years of a four-year contract and a 2 percent increase in each of the final two years. It also wanted to increase worker contributions to health coverage from 1 percent to 4 percent and freeze the level of pension benefits.

The union wants a 4 percent raise each year and health contributions to remain 1 percent. It is also seeking an increase in pension contributions from $75 to $100 for every year of service.

The TWU also is seeking changes in subcontracting and training provisions to allow members to do maintenance and repair work on buses and trolleys now done by outside contractors.

SEPTA’s 5,100 unionized bus drivers, subway and trolley operators earn from $14.54 to $24.24 an hour, reaching the top rate after four years. Mechanics earn $14.40 to $27.59 an hour.

I am a huge public transportation advocate and I have made a point on this blog in the past about treating transit workers with respect.  However, I find this strike rather distasteful.  First off, in a city and region that depends on transit you need to give riders greater warning than just walking off the job at 3am.  If you want respect you need to give it back.

Moreover, while transit employees work hard and deserve a living wage, they also do not have any real fungible skills or training.  The $24.40 an hour they can earn after four years (equivalent to $48,480 a year on a 40-hour work week) seems perfectly appropriate given the position.  Two people earning that salary can more than support a full family in Philadelphia.

The healthcare, wage and pension expectations seem plain greedy when 10% of the country cannot find employment at all and many of their riders are working overtime just to make ends meet.  Most importantly, the union is bargaining with a semi-public agency, not a multi-billion dollar publicly held company.  SEPTA is not trying to gouge its workers, rather just trying to make ends meet on an already stretched budge.

This strike needs to end soon, it is not good for any of the parties involved.

 

Paris Bike Rentals: Success and Tribulation

In Friday’s New York Times was an article about the French bicycle renting system, Velib’.  I was disappointed to learn that the system is being plagued by vandalism and theft.  According to the article, the bike-renting service provides 50,000 to 150,000 rides per day.  However, 80% of the original 20,600 bicycles have been stolen or damaged.  Much of the crime has to do with Paris’s social inequalities and perceived economic and class dynamics of the transportation mode.

The heavy, sandy-bronze Vélib’ bicycles are seen as an accoutrement of the “bobos,” or “bourgeois-bohèmes,” the trendy urban middle class, and they stir resentment and covetousness. They are often being vandalized in a socially divided Paris by resentful, angry or anarchic youth, the police and sociologists say.

Bruno Marzloff, a sociologist who specializes in transportation, said, “One must relate this to other incivilities, and especially the burning of cars,” referring to gangs of immigrant youths burning cars during riots in the suburbs in 2005.

He said he believed there was social revolt behind Vélib’ vandalism, especially for suburban residents, many of them poor immigrants who feel excluded from the glamorous side of Paris.

“It is an outcry, a form of rebellion; this violence is not gratuitous,” Mr. Marzloff said. “There is an element of negligence that means, ‘We don’t have the right to mobility like other people, to get to Paris it’s a huge pain, we don’t have cars, and when we do, it’s too expensive and too far.’ ”

The Velib’ has expanded beyond the Parisian urban core to 29 other towns and suburbs.  I hope that there are solutions to the problems the Velib’ faces in Paris, because I would love this to be a viable model for other cities and towns around the world, and especially in the US.

While Paris requires a credit card to borrow a bicycle and fines individuals for not returning bikes perhaps they should consider making users better internalize the costs true to form of most car rental systems, including Zipcar.  When you rent a car you can frequently choose to forgo paying for insurance, but most drivers purchase it in case of an accident.  Perhaps Velib’ should make riders pay more for the costs of damage and stolen bicycles and offer insurance to cover such costs.

In addition, social ownership of public transit is a problem throughout the world.  In order to keep public transportation clean and well respected the riders must feel a sense of ownership for the system and a sense of responsibility toward keeping it safe and productive.  I know very little about French socioeconomics, but perhaps more bicycles need to be placed in urban neighborhoods.  Perhaps there need to be discount rates for the underprivileged.  Whatever solutions are available, I hope they can be implemented so more cities look to Paris as a model rather than a warning.

- – - – - – - – - – - -

In unrelated news, the New York Times also had a quirky and enjoyable vacation feature on the Station Inn in Cresson, PA.  It sort of looks like the nightmare train scene from My Cousin Vinny, but it also looks like a really fun vacation.  The Station Inn provides railside views of dozens of freight trains passing through every day and people come from all over the world to watch the trains and discuss rail trivia.  I mostly would want to go to sit on the porch and hear all the rail enthusiasts chat it up.  However, something tells me my partner would not be interested in such a trip.

 

SEPTA Union Ponders Strike

The buses in Philadelphia pass across Broad Street flashing route numbers and the ubiquitous “GO PHILLIES!” but the Philadelphia Inquirer reports that a strike by the transit workers may be impending.  The Transport Workers Local Union 234 – which represents the bus drivers, subway and trolley operators and mechanics – voted to strike as early as the end of the week.  The workers, who have been without a contract since the spring are prepared to strike just as the World Series, featuring the Philadelphia Phillies and the New York Yankees, would begin.  It would be ironic for the buses to stop flashing their cheerleading signs just as the team they support would most need the fans who ride the buses.

The impasse is over how much the workers should be paid (isn’t it always?):

Management has proposed a zero wage increase for the first two years of a new four-year contract, with 2 percent increases each in the final two years. It also wants to increase contributions to health coverage from 1 percent to 4 percent; and to freeze the level of pension benefits to members.

The union wants a wage increase of 4 percent each year, and an increase in pension contributions from $75 to $100 for every year of service.

I am no expert on collective bargaining or SEPTA’s finances, but I hope this comes to a peaceful resolution for the residents of Philadelphia who depend on their public transportation system. My personal opinion is limited to the fact that transit workers generally are compensated rather well for a job that by-and-large requires no real skills to apply for.  This is not true for mechanics and sheet metal workers, but drivers and operators are usually trained on the job.  Every worker deserves a living wage, but those workers also must honestly assess the finances of the businesses they work for.

Of course, as the Transport Politic has illustrated so well, if they strike, this will not be the first time SEPTA workers have done so.  In fact, they have done so in 1944, 1998 and as recently as 2005.  So I trust the good citizens of the city of brotherly love will cope should they need to.

SEPTA is not the only transit organization with worker issues, as VIA Rail in Canada is also engaging in contract talks with its unionized workers.

 

MTA Price Restructuring?

The passion of new MTA chaiman Jay Walder in New York is infectious.  I also admit that I have a bit of transit nerd man crush on his use of subway token cuff links.  However, his idea for price restructuring on New York City public transit leaves me a little baffled.  It may just be that the New York Times did an insufficient job explaining the benefits of the policy.

“We might imagine that we offer discounts at later times, or we offer weekend discounts,” Mr. Walder said in an interview on Wednesday. “Time-of-day pricing might be very attractive.”

The goal would be to encourage use of buses and subways during traditionally quieter hours. And it would bring New York’s subway system in line with local commuter rails, which charge a range of fares.

“We have an infrastructure that is set for the capacity of the peak,” Mr. Walder said. “What we really want to do is use that infrastructure all the time.”

The chairman ruled out charging higher prices for longer trips, a system used in cities like Washington and London, saying such a move in New York “would be a mistake.” But he said a frank discussion of changes to the pricing structure “will be an important part of what we’re doing.” A transit spokesman said later that Mr. Walder was not considering higher peak fares.

I understand the desire to have more people riding at non-peak hours in order to make the system run as efficiently as possible.  This is especially true in New York City subways which almost never shut down.  However, I do not follow the logic of reducing prices so people ride more.

In New York there are two types of people who travel at night and weekends, permanent residents and tourists/visitors.  The commuters, who constitute a huge number of MTA’s ridership are avoiding the MTA on nights and weekends if possible.

For the residents and tourists/visitors to ride at night or on weekends requires someplace to go, which is the expensive part in New York, not the subway ride.  Once traveling, though, the only other real option is a taxi and the regardless of the price of an MTA fair, it will almost surely be cheaper than a New York City cab fare which is $2.50 just for getting in the cab.  City residents on the other hand probably own monthly passes which means each additional ride they take, regardless of when they take it, is essentially free.

If anything, it would make more sense to tax certain hours of travel, say 8am-10am and 4pm-7pm to encourage people to take the subway and bus at off peak hours, hence increasing demand the and helping to reduce congestion during rush hours.  However, I like the fact that a transit administrator is excited about transit and trying with innovation to get more people to use it at all times.

Perhaps I am missing something logical and important here.  If one of my readers recognizes it, please inform me and other readers with a comment.

 

Recession Encouraging Less Independent Travel

USA Today wrote in September that the percentange of people driving alone to work dropped from 76% to 75.5%.  In addition, the paper reported that the number of households with one or zero cars rose from 41.8% to 42.2%.  Both of these may be consequences of the recession, with people cutting back on costs all around.  Given that transportation is an American family’s second largest cost after housing, on average, makes it no surprise that some people are cutting back where they can.

If the government wants to capitalize on these trends, and battle the conspicuous consumerism and misguided dependence on the automobile that has led this country to own almost as many cars as people that live here it must not only fund transit, but stop subsidizing both cars and parking so much.  Streetsblog effectively exposed how much the government subsidizes parking rather than transit:

But the subsidy debate often overlooks the government tax exemption for workers’ parking expenses. And federal parking subsidies are skyrocketing, as Subsidyscope revealed yesterday in its data-packed report on U.S. transport spending: the value of tax-free parking will reach $3 billion this year, compared with $500 million in subsidies for transit use.

The imbalance might be corrected if the government treated parking and transit equally when it came to tax benefits. Workers can write off a maximum of slightly more than $200 in monthly parking benefits, while the maximum tax-free value of transit passes is about $100 less per month.

All of this contributes to why I was not so upset when Detroit began faltering last year.  I have the utmost sympathy for those who have lost their jobs, but I have little love for America’s obsession with driving, especially driving alone.  The government could do a lot to encourage people to drive less to work alone.

Transit cannot be built overnight and is expensive to operate and build.  However, the government can encourage people to commute together, and not just through HOV and HOT lanes.  The subsidy for parking should be done away with or reduced such that people are given greater reason to commute with neighbors, friends and coworkers.

Moreover, while new transit systems, especially rail-based systems require radical infrastructure investments, park & ride systems or other bus systems that travel on existing routes can be immensely effective.  If the parking subsidy were transferred to park & ride subsidies such that people could still take the highway it would be effective.  In fact, if current HOT and HOV lanes were reserved only for public transit buses those who took public transit would actually get to work more quickly!

Americans need cars, but they don’t need multiple of them and they do not need to drive them alone every day.  The recession is an opportunity to mold transit habits while people are willing to make changes.

 

Appalachian Development Highway System: Outdated Highway Construction

As of this moment, I am in Nantucket, MA.  It is a place far removed from urban life.  It is full of classic New England beaches and grasses.  Nantucket’s landscape is sparse, intentionally kept sparsely populated.  I believe America needs places like this, but at the same time the majority of Americans should live in or near cities.  The national parks – as Ken Burns is currently showing us – are a tremendous treasure and it is important that we allow people to get there to visit them.  However, the utility of building roads to create new communities or prop up non-densely populated ones is limited, if not of negative value.

Yet, programs like the Applachian Development Highway System still exist.  Next American City provided a great overview of the ADHS, which is run by the Appalachian Regional Commission.  The program was set up with noble intentions in 1964 to bring economic growth to Appalachia.  As of 2008, 2,672 of the allocated 3000 miles were built, and the remaining were amongst the most expensive to build.  Next American City linked to a great video to PBS (click the previous NAC link).

These remaining 14% of miles should not be built.  I feel badly for the people of Appalachia, but their economy is not about to be saved.  The industrial and mining jobs are not coming back, especially in the mining regions where the relevant ores and coal have been exhausted.  These people should not be given false hope via expensive highway projects that no one will ride.

Those infrastructure dollars are precious, and using them to cut down trees and plow through mountains in the name of “economic development” is plain stupid.  Transportation infrastructure is a key element in economic development, but in an age where the vast majority of Americans live in cities, those dollars should be focused on those places, not in the places where few people live.  We must focus on making our cities sustainable, not creating boondoggles of asphalt through places where dirt trails should be the primary means of travel.

That doesn’t mean Appalchia has no urban areas.  Some Appalachian advocates want the money funneled into the cities.

Birmingham real estate developer Cathy Crenshaw imagines how a project like the ADHS could be reevaluated to actually meet the public demand. “It would be pretty wonderful if we could shift some of these dollars for larger projects back into cities. The question is, how do we build neighborhoods that we want to live in and want to walk around in and know people? That requires investment. So, I would much rather, personally, see investment in public transportation, which is much less expensive than a new highway system.”

Let’s give the people of Appalachia incentive to build better cities, not more poverty along poorly-traveled roads.