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Fri, Nov 09, 2012

ANN Readers Offer Differing Opinions About Election's Effect On Aviation

We Asked How You Felt The Re-Election Of President Obama Would Affect Our Industry

One thing is certain ... well two things, actually. Barack Obama will be President of the United States for another four years, and ANN's readers have differing opinions about what that might mean for our industry.
While many of our readers think Tuesday's outcome will spell hard times for aviation, some wrote to say they feel that the President's policies towards aviation are not necessarily bad.

"In contrast to your position, I hope that Obama will enact some kind of user fee on private jet transportation that makes use of ATC facilities," said reader Cliff W. "I think it does pay something toward the cost of maintaining our NAS, and that might be enough to put off further pressure to enact user fees on the rest of general aviation.

"I think aviation is taking a beating because of the high cost of flying. One component of the high cost is fuel, and I'm hopeful an unleaded replacement for 100LL will be approved soon. The other component is the cost of aircraft, and I think the new effort by the FAA to reduce the complexities of certification will bring new, exciting aircraft to the market.

"I think the leaders of the aviation user groups should act and be representative of their respective groups. EAA and AOPA both need to be much more transparent about their operations, and really open up selection of their Boards of Directors and executives to their larger membership.
"I am overjoyed with the results of the general election. But for aviation generally, I don't think much will change unless we become the change. Thanks for the opportunity to sound off."

Reader Len A. said that the User Fee issue is, in his opinion, something of a red herring. "I'm probably a contrarian view, and am definitely a liberal Democrat, so that also probably colors my perceptions, but here goes:

  • We do not have to worry about GA user fees under an Obama administration. Going negative on business jets was pure political posturing meant to firm up the support of the base while alienating virtually no one who would have voted for President Obama anyway. We have too many much more important issues to confront. User fees will fade from the conversation. Even if they are tacked onto a bill, it will be as a negotiating ploy -the first thing to go to secure a member's vote on a bigger issue.
  • NBAA, AOPA, EAA and the rest know this and will of course continue to milk this non-issue for all it is worth as this means more membership and more donations. (NRA is the same way, guns will not be nor ever were an issue for Obama -as PRESIDENT- but NRA sure scared lots of members into donating money to fight nothing!)
  • GA's problems are economic, regulatory, and structural in nature. The economy is on the way back, that issue will go away at least until the next cycle starts. I see some regulatory progress (3rd class medical might go away, re-write of part 25, etc.) And the structural issues we can control. Changing the nature of the industry is possible and can help tremendously to reduce the new pilot dropout rate, bring older pilots back into the fold and change the economies of scale. We need to embrace innovation shown by players like Redbird, like whoever survives the upcoming LSA shakeout, like Aviation Access Project, and like the potential of buying a pre-built RV 12. The future is with groups like these and it looks positive. Thanks for the opportunity to comment."

But on the other side of the aisle, Bill H, who sent us a picture of his Cessna, said simply " comes the $100 per flight tax..." Bill said he might put his airplane up for sale, or just abandon it on the ramp. Bill, if you decide to do that, leave a signed title and the keys in the airplane and let us know where it is."

From a reader who signed only as 'Bob': "Everyone wants to lower the corporate tax rate (including Obama) and broaden the tax base by eliminating loopholes. Eliminating loopholes is code for taking away business deductions.

"Reducing the business aviation deduction will not create a huge amount of revenue (to be used to lower the corporate tax rate)  but it is highly symbolic. The restaurant industry predicted disaster, if the even more symbolic two martini lunch deduction was limited. Yet we have lived with the limited meals and entertainment deduction for almost two decades and business lunch restaurants are thriving. General aviation needs to compromise as well.

"A percentage reduction of the deduction for general aviation will not kill the industry, would be very good for public relations, would eliminate uncertainty (which is killing the industry) and can be used as a bargaining chip for an overall plan to reduce the corporate tax rate."

Reader Samuel W. said that maybe we doth protest too much. "I feel that we throw the word "fear" around a bit too much and that can lead to paralysis-by-analysis. We in aviation are actually guilty, in my opinion, of letting politics and political parties become more important than flying.

"I recognize that politics is a part of the equation, but flying should be our primary focus. When we approach our politicians, we should do so for the love of flying, not to score political points. When we stand and tell people about aviation, we should tell them about it from our love of flying, not just to keep down complaining voices. And yes, if our President proposes a solution that could endanger aviation or hinder it, we should tell him about our love of flying and show him from the personal perspective what it means to us; not from a red state/blue state perspective. The election is over now. President Obama is one man, albeit very powerful; yet he cannot pass legislation on his own. There has to be some help around him.

"Let's not concentrate just on him; let's tell everyone in government how much we love aviation and then let's back up our talk with real action at our home airports, starting today. Blue Skies!!!

A reader who identified himself simply as 'Matt' said "The election was as troubling for me as it was, apparently, for much of the country. I can only hope for candidates in the future who will represent the 80% in the center vs. catering to the 10% on each end of the political spectrum. Anyway, to answer your questions:

  • Yes, aviation can survive under Obama, but there are challenges that we face both because of who is in the White House, and unrelated to who is in the White House. Obama seems intent on a new aviation tax. That's a bad thing for aviation and just doesn't make sense. The economy is not robust as a result of some historically bad decisions (Dems and Repubs) and catering to unsustainable special interests, and that's a bad thing.
  • Aviation will rebuild itself. But it will take some serious retrenching. Think about what happened with the automakers – it took forty years of decay and getting our butts handed to us by the Japanese and German manufacturers, AND a financial crisis to REQUIRE changes in that industry. How different is General Aviation?
  • NOT implementing a per-flight tax would be a great start. Leaner and more efficient manufacturing. A recognition at the White House that aviation is a core US strength that should be maintained. And maybe even R&D subsidies (a bad word among 49.5% of the population) that will SUPPORT industries we feel are critical to national competitiveness (and not just hand-outs to special interests) where high growth and keeping profits and jobs in the US is important.
  • Convince elected officials that General Aviation is a VERY important part of the US economy and that it is GOOD.
  • Stop demonizing and start working together. Calling Obama and the Democrats socialists, communists, anti-American, or anything else like that does NOT help. They will turn a deaf ear to the cause. Instead recognize there are differences of opinion, our citizens don't always see eye-to-eye, and focus on the issues that we really care about (aviation).
  • I suspect business will be slower to grow than it would have been under a republican president, but maybe we will be able to get some Obamacare health insurance for our employees." 

"I am a recreational pilot and own a 1/3 share of a 1977 Warrior (similar aircraft pictured)," wrote Bryan T. "Fuel at $6.00 per gallon really hurts. Obama has promised to significantly increase fuel prices. I may just have to abandon my airplane, as no one else can afford it either." We'd refer Bryan to the same comment as we had for Bill above.

"From my GA perspective, having been born into this business in an aviation family and working in this business for 30+ years, the #1 item that needs to be rectified is the fact that us Americans, continue to elect lawyers!," said William M. "The product liability in this industry is killing it. Why?  Because our system allows ridiculous lawsuits to be filed against companies and people who did nothing wrong. The system allows the attorneys to file lawsuits against those who happen to be able afford the exorbitant cost of insurance. That's right, they won't go after the guys who don't have insurance...there is no profit in that. They are allowed to devise stories and lies created to solely extort money from aviation companies and insurance agencies. There is no system in place that relies on science, logic, truth and justice. It is operated by attorneys and it all starts at the top. Lawyers take care of each other. As such, as long as the attorneys are in office running our country, the GA industry will continue to decline, will continue to suffer, will continue to waste away, will continue to be sold off to foreign countries.

"Secondly, we need the fix the economy and jobs. Why?  Because we have lost our grassroots flyers. The people who fly cubs, 150's, 172's and Cherokees have stopped flying. The pilots who had decent jobs and flew on the weekends for fun can no longer afford to have an annual completed on their airplane. Nor pay for $7 per gallon of fuel. Nor can they buy an engine. Nor a GPS. They need work.

One of our readers said he was on the verge of abandoning  a long-held dream of starting a very small commuter airline. "I've been told by banks, lending institutions, tax accountants, etc. that things will change after the election...that if the Republicans get in, investment possibilities would break wide open. Now, I guess my long time endeavor is pretty well diminished," wrote reader 'Herm'. "With the reelection of Obama, I fear investment possibilities for small businesses will be impossible with Obama's fundamental changing of the United States of America. With the implementation of Obamacare and all its in-between-the-lines regulations, nobody will be interested in starting a new business...investment companies just will not be interested.

"So sad for us that had high hopes for the future. Will it be better for my two sons who lost their jobs, lost their houses, families, etc., to have something to look forward to? All we can do now is pray Obama changes his terrible policies."

Taxes were also on the mind of John A., who wrote: "Tax pressure on those that buy planes such they will be less likely to stretch to invest. Moderate growth instead of increased rate of growth. I do not predict a reversal into recession.

"They will find some stupid way to get user fees started. We will survive the next four years but things will not be moving in the right direction. Continued spending will put us deeper in debt and we will be Greece in 5 years. Now I know what it feels like to be the major minority. I for one was looking forward to a vibrant future. Now I see a very messy future with more government intrusion and squandering of wealth and liberties."

Jack S. wrote that in his view, American aviation will survive Obama but, by 2016, private aviation will likely cost 2 or 3 times more, compared to today - whether operating a LSA or a G-650. "Obama will fail in his, “tax the rich,” campaigns but he will be able to use the DOT for his, “revenge,” and make those rich private aircraft owners pay. His re-election will re-energize unions and aerospace companies countrywide will need to bulk up and strengthen HR departments including in-house or outside legal staff experienced in labor law, contract negotiations, grievance settlements, NLRB, RLA and NMB. During Obama’s first term, the NLRB reach has been gradually extended to non unionized companies as they claimed jurisdiction over issues like confidential HR investigations, at-will statements in employee handbooks, mandatory arbitration programs, etc., under the guise of protecting American employees rights. The next 4 years, in my opinion, will be very difficult for the industry and the country in general.

"My background is a pilot and airline management. First solo in 1946, subsequently flew DC-3, DC-4, C-46, AW-650, L-382, Constellations, DC-8 aircraft for several US airlines and DC-8’s for Douglas Aircraft. I owned and flew a Learjet 23 aircraft for several years after retiring from the airlines. I’m still actively engaged in the industry as a consultant.

The possibility that the Republic might not crumble was also expressed by Susan H., who wrote "Perhaps we are not doomed, but the next four years will be as bad as or worse than the last. Aviation in general, and general aviation in particular, represents everything this president hates--except when it is for himself, of course. Individual initiative, personal ambition, corporate success, all anathema to statists like the newly-affirmed regime. We will have to hunker down, stay below the radar, and hope for better days."

Anthony L. wrote: "I expect no new designs in the future. As one unnamed source told me at OSH this year, Why bother with said projects when "the leadership" can absconded your Preferred Stock  or Corporate Bonds (as with GM) with the wave of a hand. A revamped STC and or Certification process? LOL, Oh please it couldn't come fast enough, but even in this economy, nah, to little to late.

"Fuel prices through the moon at some point, after all energy prices will necessarily sky-rocket, equals fewer new pilots. Forget about the "Fracking Revolution" spurring an Energy Renaissance, the Executive Order is in place to stop it. With these fuel prices already high,  I see more pilots hangar flying, getting gray, not current, building something they may not finish.

"(There will be) a surge in Ultralights (and) E-LSA's, watch a ton of Legal Eagles / Double Eagles / Cabin Eagles get started, think cheap, cheap, cheap. And watch the FAA magically start perusing your Medical Data since it will all now be in Fedzilla's Database, as the last exit to get rid of Obamacare has now passed."

Gene Y. said simply: "Ultralights will thrive under the Obamanation. It'll be the only form of personal aviation you can afford!"

And finally this from Hank R., who calls on the industry to stand up and fight for the right to fly. "The future does not look bright, and if General Aviation in the United States wants to survive we need to continue to work together tirelessly to stop any further degradation by the current Presidential Administration," Hank said. "This includes doing what we can to block Obama’s proposed User Fees. I believe if instituted these will deal a death blow to aviation as we know it and do irreparable harm to the system.

"The current proposal says that only turbine powered aircraft will be charged when in controlled airspace, but there are no definitions of what is considered controlled airspace. At worst this means all class E space and above which include departures or landings at any public airport with a published instrument approach. At best it would mean only if you speak with an Air Traffic Controller. Either option is still bad news for General Aviation and Safety in General as pilots will do all possible to avoid the help of Air Traffic Control so they will not be charged the $100 making the skies less safe for everyone.

"Those pilots who think they are OK because they fly less expensive Piston driven aircraft will likely just have the inevitable delayed as the Federal Government will have to create a new bureaucracy to collect the fees (another department of DHS-FAA-TSA-IRS type group?). Once this department is in place they will quickly run out of funding and expand the user tax to include all piston aircraft.  If you ask why they will run out of money, it will be due to a combination of the huge additional expense of creating another Federal Governmental Department and the massive decline in the number of flights operated in controlled airspace. Local agricultural crop dusters will be forced to curtail operations and to either change from airplanes to helicopters which can be trucked to off airport (avoiding controlled airspace) or charge huge increases in the price to spray crops. This ultimately will affect farmers all over the USA and increase cost of food (the increased amount of food production in America related as a result of crops dusting is astounding, look it up).

"This decline in operations of private jets will not only impact what President Obama calls the wealthy few who should be taxed at a higher rate, but the trickle-down effect will ultimately lead to lay-offs in mass numbers for those folks who make a living servicing the aircraft. And not only servicing them, but building them as well. We have already seen a mass exodus of aircraft manufacturing jobs and exportation to China where they are realizing and appreciate the growing importance of the General Aviation Industry.

"The current system of taxation based on the per gallon sale of aviation fuel works,  has worked and will continue to work fine. It targets end users fairly. Why would we want to change the system that has made us the greatest General Aviation Country in the World when there are established proven funding streams available?   Proposed User Fees (Tax) will result in: decreased number of aircraft operated, continued decline in the number of public airports, increased unemployment, more dangerous skies, shrinkage of the aviation transportation system as a whole plus the economic development it provides and an increase in the cost of food put on your table.

"President Obama appears to not care about these things as he continues to try and villainize those corporations using private jets for private enterprise while he spent untold taxpayers dollars by flying a 4 Engine Boeing 747 Jumbo jet around the United States campaigning (does anyone remember him sending that aircraft to fly around the Statue of Liberty in New York shortly after being elected the first time? Seems he wanted some new pictures).

"Unfortunately User Fees are not the only issue facing General Aviation with the re-election of President Obama, other issues include newly announced move by FAA to reduce the number of Instrument Approaches; EPA action to eliminate 100LL Avgas and finding a suitable replacement; Continued excessive TFR’s which affect margins an Aviation related businesses, and the continued assault by the President on use of private corporate aircraft no matter how much economic sense it makes.

"I am sure there will be other issues that come up which I have not mentioned, but fortunately for us, despite the President’s comments during his victory speech, only half of America voted for him and we can still make a difference if we join in the effort."

And that is just a small sample, folks. Thanks to everybody who wrote in to express their opinion about what the President's re-election will mean for aviation. You can bet that we'll be watching, and reporting, on the stories coming out of Washington that matter to you.



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