Tuesday, May 20, 2014

Protecting Jobs???

Of economic interest today is Lee Moak, President of the Air Line Pilots Association (ALPA), and his views on NAI (Norwegian Air International). You can read his article “Why the U.S. must deny NAI” in USA Today to get all the facts but in general Mr. Moak want the government to deny NAI operating license in the U.S. because it will mean a loss of American jobs (pilots for the most part). 

Mr. Moak uses the example of the U.S. maritime ocean-freight industry where, in 1960 there were more than 100,000 people with jobs but today there are less than 2,500 jobs. It seems that allowing non U.S. businesses to haul ocean-freight has wiped out a lot of jobs (according to Mr. Moak). Except Mr. Moak does not do any research, or maybe he did and did not include it because it does not fit his agenda. The majority of the 'lost' maritime jobs were lost, not because of foreign competition but by improvements in technology. One of the big items was the development of container shipping (lots of other minor improvements as well). The tonnage of freight shipped has more than quadrupled since 1960 while the average amount of freight handled annually by each maritime worker has jumped from 3,393 tons in 1960 to 591,840 tons today. [Mr. Mork also does not discusses the number of "new" jobs and wealth created by the increase in the goods shipped].

As the president of ALPA, Moak is calling for a freeze on new competition. He could call for the government to do other things. Why doesn't he call for the government to prohibit jumbo jets? After all these big jets reduce the need for pilots. In fact how about legislation that limits the number of people that any aircraft can carry – say 75 or maybe 50 on a plane, max? There would be lots of new piloting jobs then.

This leads me to the speculation that other jobs could also be "saved" or "created" with just a little government action. How about limiting class room size to 10 students? Think of all the teaching jobs that would be created. Or, how about legislation that mandated travel within cities to be done by rickshaw or better yet by sedan chair – more jobs created in that way and with the added benefit of reducing pollution and reducing our dependency on fossil fuels.

I know that theses suggestions (maximum 50 passengers per flight and mandatory rickshaws) are ridiculous but no more so than Mr. Mork's statements. According to him this is not about “low cost and consumer choice” but it is about jeopardizing U.S. jobs to a business model that will “reap a parent company substantial new profits by putting U.S. jobs at tremendous risk”. What is NAI thinking? Creating a low price delivery model that benefits the many – the consumer. NAI is not in business for the many, the consumers, they are in business to benefit the few, the pilots.


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