Who regulates the airlines? What is the difference between the FAA and the NTSB? Who is responsible for breakdowns in the ATC system?


The FAA is charged with regulating airline safety. They make the rules on pilot training, proficiency and health standards. Also on aircraft design certification and aircraft maintenance standards and procedures. The FAA operates the air traffic control system and sets the standards for operations within that system. The FAA makes the rules, is the jury, judge and executioner for those who violate those rules. It is the law and any rule it makes is the equivalent of law, provided it does not contradict the general rules laid down by Congress in the legislation that gives the FAA its existence and authority.

The NTSB is an entirely separate agency. Its mission is to investigate transportation accidents (airline, highway, rail, pipeline) to find the cause of those accidents and to make recommendations on how to prevent a repetition. It has no authority or power to impose new regulations. Only the FAA can do that, within the limits of its lawful authority, or Congress can intervene and pass more laws to require new regulations or to alter old ones.

If you have read the statement on our home page, you know that my bias is towards free market solutions to our problems. It is my view that the problems on airline safety, we see in the media so often, are largely the result of ponderous, lumbering bureaucracy. It is what you get when you try to have big government regulate us to utopia.

I am in agreement with former Transportation Secretary, James Burnley, when he testified before Congress in 1988, that the ATC system should be removed from the FAA and formed into a privatized user corporation. The ATC system was originally started by the airlines and was later taken over by the government.

As to the regulation of the airlines, you can find accident report after accident report wherein the NTSB castigates the FAA for failing to prevent the accident with its oversight authority. In other words, the FAA was not doing the job it was hired to do. In private enterprise you fire the company if it fails to do the job you paid it to do. But, in government, we give it more money and more monopoly authority and wonder why things get worse. It works much the same as the socialist primary education system we have in this country. No matter how much money you throw at it, it keeps getting worse. The city of Washington D.C. spends over $9,000 per pupil (one of the highest in the country), yet it is one of the worst systems in the country with a dropout rate and illiteracy rate rivaled by few others (except maybe Chicago). At the same time, Marva Collins is turning out outstanding scholars that end up becoming doctors, engineers, lawyers, judges and various other kinds of professionals. Her West Side Prep school, in Chicago, caters to the poorest of the poor and she accepts no help from government funds. Yet the miracle of education she performs, is done with only the fraction of the amount the public schools spend on their often failing pupils.

My point is that government regulation is almost always a failure because it is a monopoly. If you don’t like it, tough luck. You have no where else to go. The Civil Aeronautics Board was created in the 1930s to set airline fares. The claim was that government knew best what you should pay. They never let an airline fail. It was either subsidized or merged with another, but failure wasn’t allowed. That way, according to the theory, airlines would have enough money to ensure proper maintenance and training. The airline employees unions milked that for all it was worth. They ended up getting much higher wages and benefits than they could in a free market and managements of the airlines became very wasteful with their revenues—after all the CAB wouldn’t let them fail, no matter how profligate they became.

But the accident rate is continuing to improve, since the Deregulation Act of 1978, which got rid of the CAB. Airlines can now set their own fares and enter whatever markets they desire. Before deregulation, only about 28 % of the American public had flown on an airliner. Now, it is closer to 75%. That is why Trailways Bus system failed and Greyhound is hanging on by its fingernails. Airline fares have dropped so low, in comparison to inflation rates of other commodities, few cannot afford to fly. Yet the safety rate continues to improve, despite the FAA, not because of the FAA. The FAA is so behind the times that its radar and computer systems keep breaking down because they are over 25 years old. They have a hard time in finding tubes to replace in the old sets; some can only be found in Poland!

The TCAS system, that allows airliners to see each other and prevents mid-air collisions (see my editorial on the ATC cover-up), should have been available at least 15 years earlier than it was. But the FAA kept insisting on a ground-based system that would have been operated through its antiquated radar system. It would have the control and pilots could not act independently to avoid collisions as they now do with TCAS II. That bureaucratic delay cost the lives of 144 in the 1978 collision between PSA and a Cessna 172 over San Diego.

I could go on and on with this. The FAA and the whole concept of government regulation is a miserable failure. The free market can and has done much better. Contrary to the liberal’s claims, airlines do have a vested interest in safety. Crashes tend to scare away customers. That is why Air Florida failed not too long after its DCA takeoff crash in 1982. US Air suffered greatly after its two crashes in one year. It took almost 3 years to return to a profitable operation and that was largely the result of the perception that it had gone to great lengths to correct its problems.

CRM (the subject of another editorial on AirlineSafety.Com) is one of the best safety tools ever devised for airline operations. That training program was designed and implemented by United Airlines after its Portland, Oregon crash in 1978. It was so successful, other airlines soon followed suit. It was only later that the FAA climbed on board and made such training mandatory for all U.S. airlines. Many foreign airlines still do not have such training and their accident rate shows it.

May, 1998

Robert J. Boser

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