What Should the Government Do About Airports?

Felix Salmon takes on Larry Summers' commentary about our airports.  Summers apparently said "Compare the quality of our great resorts with the quality of the airports you take off from to visit those great resorts". To which Salmon rather tartly responds:

It's clearly not easy, being Larry Summers. For all his millions, he still needs to travel from A to B, and keeps on finding himself stymied. First of all he lost his Harvard town car and chauffeur when he moved to Washington, and stood out there for demanding a similar car and driver in recompense for not getting the job of Fed chairman.

And now, it seems, the poor chap has to navigate airports fit only for the masses, while making his way to luxury resorts designed to pamper the every whim of the gilded elite.

As an economist, Summers should know that it makes perfect sense for great resorts to spend enormous amounts of energy on the kind of quality he's talking about: that's their comparative advantage, the very heart of what they're selling. Meanwhile, Summers isn't really even the customer of the airports he's passing through: the airlines are the customers, and the passengers are the goods being transported. So the airport doesn't have much in the way of economic incentives to ease Summers's way.

I'm sure that Summers has encountered lots of shiny new airports in his travels around the world, in comparison to which US airports look decidedly crumbly. But a lot of that is simply a function of age: it's easy for Chinese airports to be super-modern and efficient, just because they're brand new. (And have the advantage of very low construction costs.) It's much harder for Delta's Marine Air Terminal to be as Summers-friendly: it was built in 1939, long before anybody ever so much as imagined the TSA. (Indeed, it was before the planes which landed there even landed on solid ground: it was designed to service sea planes.) But because the terminal is one end of the Delta Shuttle from National Airport, I'm sure Summers knows it well.

More to the point, a lot of the money spent on shiny new airports around the world is simply wasted, from an economic perspective. National governments, especially in developing countries, like to show off when it comes to the airports where luminaries like Summers arrive. But all that expense isn't really necessary for the smooth functioning of the airport.

Summers has been a vocal proponent of infrastructure investment, but if his idea of good infrastructure investment is cosmetic airport revamps which give him plusher lounges and colder drinks, then that's just depressing. The really crucial infrastructure investment is in things like the national electricity grid, or NYC's Water Tunnel 3 -- expensive, yes, but decidedly unglamorous.

I don't think the first part is quite fair.  My household, alas, cannot afford to frequent the five star resorts to which Summers is undoubtedly accustomed.  But the more modest affairs to which the McSudermans occasionally repair are also much nicer, and more efficient, than the average American airport.  For that matter, the last EconoLodge in which I stayed had rather more in the way of amenities.

Now, there are fair points to be made in rejoinder, and Mr. Salmon makes some of them:  the nicest airports are probably government boondoggles; the purpose of an airport is not to relax, so of course they don't have much in the way of comfy chairs; and the developed world has rather more in the way of old infrastructure that has to be worked with.

Still, I think there's quite a lot about American airports that is important, and inadequate.  Given the ubiquity of electronic devices, and the importance of airports to business travelers, we could probably enhance national productivity quite a bit if so many airports didn't force travelers to spend their wait times fighting each other for the one electrical socket located behind an out-of-order ATM machine.  The ridiculous security theater procedures which have queues stretching out towards the long-term parking lot could be streamlined.  And whatever engineer designs monstrosities like Heathrow's 40-minute walk-time from security line to gate should be tracked down and . . . um . . . reeducated, or something.

We might also give serious thought to whether something can be done about the incentives system--and local authorities--who fix things so that the only important customers of airports are the airlines.  In many places, a combination of zoning, and the local authorities who often run the airports, means that there's no meaningful competition.  The result is that they don't have to do anything to please passengers, and boy, they sure don't.  If Felix's point is that improving the airports is probably not going to be a matter of huge government expenditures--or that this is not the best use of said expenditures--I'm pretty sure I agree.  But we might think about regulatory changes that would give them reasons to improve.

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Megan McArdle is a columnist at Bloomberg View and a former senior editor at The Atlantic. Her new book is The Up Side of Down.

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