Privatize Air Traffic Control: We Deserve Better! | Commercial Space Transportation

Privatize Air Traffic Control!! We Americans Deserve Better!!!!

If this page persuades you that privatizing the Nation’s air traffic control system makes sense, forward this page to your friends. Definitely, send it to your Senators and your Congressman or Congresswoman. http://www.commercialspacetransportation.info/privatization/

If You Travel by Airplane–This Message is Important to You

If you have ever been late to your destination on a busy flying day, it may have been due to weather, air carrier issues, or the air traffic control system. This year there were a large number of airline computer failures contributing to delayed arrivals or flight cancellations–blame the airlines for that. However, in normal years one of the greatest contributors to flight delays is the air traffic control system itself.

Antiquated Air Traffic Control System-The government equipment for tracking, controlling and separating aircraft is a patchwork of old and more recent equipment additions. FAA’s major modernization effort has been experiencing delays and cost overruns. As demands on the ATC system grow more complex, the role that the air traffic system will play in causing delays will increase.

It doesn’t have to be this way. There is draft legislation that would “privatize” the air traffic control system. It would transfer responsibility for air traffic control, along with the controllers, equipment, and all support from the FAA to a quasi-private organization that would modernize just like a private company. Sceptics don’t think privatization makes a difference; actually, it does. Could it make a difference for the antiquated air traffic control system?

Take time to read the exciting proof and decide for yourself!!

Privatized space travel–30 years ago space transportation was privatized (Did you know NASA no longer has its own launch vehicles–it gets them from the private sector), and today we have one of the most promising, exciting rockets launching satellites into space, and soon SpaceX, Blue Origin, and Virgin Galactic will be flying passengers into space. (See the videos of their rockets on this page.)

The private space industry will do more for us than NASA could. Sure, we saw beautiful white-suited astronauts aboard a $450 million space shuttle, or astronauts in street clothing floating inside the $150 billion International Space Station, but it was a vicarious experience because few Americans believed that they would ever have the chance to travel to outer space. The other question is how many government space stations and space shuttles could our nation afford? In fact, we no longer have a space shuttle and NASA no longer has any rockets because a space program is expensive. When the government tries to do something, even when it does it well, it is super expensive. Like space. When government money runs low, or priorities compete, or enthusiasm wanes, or there are too many liability issues, there goes our space program….!

Enter the private sector and what do you get? Excitement and Entertainment! On October 30, 2017, SpaceX launched and landed it’s 16th successful launch of the year. With the private sector, we get creative power and boldness. For the first time, American citizens see the possibility that perhaps one day soon everyday citizens can experience space travel. Elon Musk is already talking about flying passengers to Mars. Perhaps the first passenger flights into outer space are available only to the very rich; that was the way with early automobiles and early aviation also. As the industry grows, prices will come down. When you get right down to it, there is a HUGE difference between government operators and the private sector.

The Creator of PayPal and Tesla brings you SpaceX! Elon Musk, the founder of PayPal and Tesla, is bringing us the SpaceX Falcon. Elon Musk may brag a lot, but his company delivers! The Falcon is an incredible rocket that lands itself when it comes back from space! Take a look at their videos on this page to the right, “The Falcon has Landed”. NASA was never able to bring back its rockets to a landing like this. Don’t misunderstand, I am sure that NASA and other government agencies are helping SpaceX with contracts and technical assistance. However, the dream, imagination, and persistence are pure private sector! (So is the humor! See “How Not to Land an Orbital…” in the video to the right.)

Virgin Galactic!If you are not convinced the private sector is bringing excitement back to space, then enter Virgin Galactic (see videos to the left) brought to us by Richard Branson and Burt Rutan, two private sector entrepreneurs who dream big! Richard Branson is the creator and owner of Virgin Records, Virgin Airlines, Virgin Megastores and, of course, Virgin Galactic! Every field he enters, he changes. His passenger ship, SpaceShipTwo, was designed by a private sector entrepreneur named Burt Rutan. Burt Rutan is probably the most innovative aircraft designer in the world; FIVE of his aircraft hang in the National Air and Space Museum. When I met Burt Rutan in 2002, he told me he knew nothing about space vehicles and had never even thought of becoming involved in space. Less than 10 years later he won the $10 million Ansari X prize for the first private spaceship to enter space with a private space pilot! NASA could not have accomplished that same goal for the same cost. That is the power of the private sector!

The Creator of Amazon Brings You Blue Origin! Finally, let’s not leave out Jeff Bezos and his launch company, Blue Origin. Most people know Jeff Bezos as the indefatigable creator of Amazon.com. Amazon has almost singlehandedly changed the face of the American retail business. (Can you imagine how long it would take the government to try to build something as complex as Amazon?) Blue Origin has been quietly, continuously developing its new launch vehicles. Like SpaceX, the vehicle is capable of returning to base and landing itself safely (see “Historic Rocket Landing” video on the left). I hope you have been looking at the age of these space companies’ workers in the videos as they cheer during the success of their launches. You are witnessing private companies engaging the brightest minds of the new generations in space. NASA did that once, but if you look at the NASA control room, you will see a lot of people in their 50s and 60s. Amazon, PayPal, Google, SpaceX, Blue Origin; that is where the action is, and that is where you will find our brightest minds.

Privatization has brought energy, excitement, and variety to the Nation’s space program unlike at any other time in history. Consider the number of space vehicles capable of taking off and returning to earth safely. Whereas NASA put all its eggs into one, huge, multi-hundred billion dollar basket to develop a single vehicle, the private sector has taken smaller, less expensive, but more frequent bites at the same apple. None of them individually is as large or as glamorous as the shuttle, but they are small commercial steps that lead to larger steps. The private sector approach and pace is much faster over the long term. In fact, with its grandiose government style plans, NASA cannot afford to build a launch vehicle that will get it back into human spaceflight, so it has been paying Russia to get to the International Space Station. However, soon NASA will be paying US commercial space transportation companies–the private industry created only 30 years ago–to fly into space on a variety of different spaceships. One cannot underestimate the power of privatization when applied to the correct type of government operations.

Private operators, whether in space, airports, logistics or air traffic control have to focus not only on a goal or dream but the bottom line as well. Is the product efficient, functional, and affordable? It is always a balance between the product features and costs because if the product is too expensive, no one wants it or can afford it no matter how good.

Government’s Specialty-Cost Overruns! Government operators, on the other hand, just spend…the money comes regardless of the what the product looks like. If you want to see another comparison, look at how the private sector builds hospitals and the US government struggles to build one hospital. Denver’s new VA hospital was started in 2010 at a projected cost of $590 million. It won’t be finished until 2018 and the total cost will be $1.7 billion and is considered to be the biggest VA construction failure. (See “Cost of VA Aurora hospital project…” news video to the left.) But that is how government programs work. You wouldn’t see this in the private sector because the company would go out of business if it did.

That news about the Denver VA hospital is pretty depressing. It is almost as depressing as the cost of the FAA NextGen modernization endeavor. NextGen was supposed to modernize the Nation’s air traffic control system and bring it into a satellite-based world. Its roots go back far when FAA got into a modernization kick in the 1980’s. Even while I was in the commercial space office, modernization plans were underway. As Director of the FAA Logistics Center from 1996-2003, I witnessed deployment of the first modernization products, some of which were necessary to make NextGen work, e.g. new radar system, WAAS, and LAAS, etc. that were beginning to be deployed; it was not off-the-shelf equipment. The products had been late because the equipment design and specifications kept changing. The equipment was unreliable, expensive and obsolete even before it was fielded. The systems consumed parts so fast that installers had to use parts planned for future systems. By the time the last systems could be installed, there were no spare parts. Moreover, by the time the equipment was deployed, it was already obsolete. Year after year, NextGen experiences cost overruns. In 2010 there were predictions of overruns (click here). Seven years later, a 2017 FAA Office of the Inspector General report criticises the program for cost overruns and being behind schedule (click here). To the public, this government program does not appear much different than Denver’s VA Hospital (click here).

Compare the Government “Modernization” to AT&T If we really want to compare the pace private companies can innovate to the US government, compare the wireless phone technology industry’s track record for the past 15 years to the FAA ATC modernization. There really isn’t much difference in technology. Just like mobile networks, NextGen is about equipment design and development; communication; signal broadcasts; data processing, transmission, switching, and interpretation, etc. However, the air traffic control system is handling 13% less air traffic from the levels it handled in the year 2000. Contrast that with the fact that from 2000-2016 mobile data has increased 600,000,000 FOLD!! Yes, you read right– 600 million times what existed in 2000 (Check the link in next sentence). Starting with 2G (2nd generation technology), technology has evolved 2 generations to 4G with 5G just around the corner. From 2000-2015 the industry doubled the number of cell phone towers from 100,000 to 215,000. Most readers of this website will remember what cell phone service was like 15 years ago; many places in the USA were not even covered. And cellphones were primitive devices until Steve Jobs introduced the iPhone in 2007. Suddenly the mobile carriers were overloaded. What did they do? They modernized. Modernization of the ATC system isn’t nearly as complex as running the huge mobile networks of this nation. In fact, the mobile systems of the US are in a constant state of modernization. Imagine if AT&T told its customers like FAA does, “We’ll modernize in 15 years.” They would soon be out of business.

Would it Work in FAA?

But perhaps FAA is different, the reader might think. After all, this involves aviation. Actually, did you know that privatization within the FAA has occurred twice, each time with dramatic results? In both situations, there were many who argued that the privatization effort would not produce different results.

Two FAA Airports Were Privatized-Reagan National and Dulles! The first time was in 1987 when two FAA owned airports, i.e. National (Reagan) and Dulles airports, were transferred from FAA to a new private organization, Metropolitan Airports Authority. Prior to 1987, National Airport was an eyesore; the building and services were extremely poor. It was an FAA owned and operated business. Although 16 million passengers used the facility every year, it was an airport to avoid because parking was impossible and unavailable. Dulles airport, once a pride of the FAA, was manifesting unsolvable maintenance issues. People today, who never saw the former FAA airport, cannot envision how bad it was. The community was extremely vocal about wanting the airport shut down. Congress was up in arms because of all the complaints.

Controversy surrounded the proposal to privatize the airports. Although there had been many studies that argued the benefits of privatization, advocates of FAA (opponents of privatization) said moving it from the FAA to the private sector would make no difference. To them, whether it was in the government or private sector, the problems would be the same. Fortunately, the advocates won.

Today privatized Reagan National Airport handles 22 million passengers a year (top photos to the right). The facilities are relatively modern and well maintained. If parking is unavailable in the multistory garages built after privatization, it is because the volume of passenger traffic continues to grow. And now, Metropolitan Airports has embarked on a new $1 Billion project called Project Journey (bottom photos to the right). Yet another modernization effort. In the amount of time that its two former airports have completed one modernization and are about to start on another, FAA has not yet completed the modernization of the ATC system. Of course, its former two airports were unable to modernize at all until they moved out of FAA.

The Logistics Center changes attracted the attention of the technology media. This Computer World article describes the transformation of the Logistics Center. Click image to read article.

IBM's Center for the Business of Government, which covers leading government innovations, also was tracking this privatization initiative. (Click Image to hear the interview.)

Government Executive Magazine took an interest in the Logistics Center change from the perspective of how it affected the ATC system. (Click on photo to read the article.) Although I am given credit for this change, it really was the leadership of my managers Barbara Silva, Darryl Thompson, Harley Farmer, Don Claypool, Rick Gracia, Terry Davidson, Bob Oborsky, Elaine Downey, Karrol Hayes, Gerald Wolfe, Stan Sieg (apologies to those left out by accident), and the entire workforce. This was genuinely a team effort down to and including the lowest paid employee.

FAA Logistics Center: the Ultimate Proof

Between 1996 and 2002, a second, major privatization initiative, under the leadership of Norman Bowles, took place within FAA. This “privatization” took place at the FAA Logistics Center. The Logistics Center today operates on revenues, not a Congressional budget allocation, and employee payroll and operating expenses are funded from revenues. To make it fully private would require a simple change in the law–one day it would be government, the next day private–and virtually no other changes would be required. Below is a thumbnail sketch of the Logistics Center privatization effort and its results. The links surrounding this discussion demonstrate the dramatic changes.

In 1996 the ATC system had about 15,000 controllers and 10,000 maintenance personnel in the field. The FAA Logistics Center, located in Oklahoma City, is the primary 3^rd level engineering facility for ATC systems and parts, and it has a parts distribution center (14 acres under one roof). In 1996, it was a $120 Million 24/7 operation with about 800 employees. ATC systems, components and parts that could not be repaired in the field went to the FAA Logistics Center for an overhaul, repair, or replacement. The majority of the workforce was specialized engineers and technicians. Its inventory of parts to support the ATC system, when the change process started, was valued at $1/2 Billion. The DNA of the FAA Logistics Center, then and now, is virtually identical to the ATC field maintenance workforce.

In 1996, the Logistics Center was in trouble. Its shipments and delivery were unreliable; product quality was poor; and before the end of each fiscal year, it would usually run out of funds creating a crisis in the ATC maintenance system. Employee morale was low. Its customers asked, “Why do we need the Logistics Center?”, and were almost ready to have it closed.

The General Accounting Office found the FAA Logistics Center to be one of the top models for employee empowerment. It was for good reason. The changes couldn’t have been successful without employee involvement. The GAO study can be found on the web with many more FAALC examples cited.

The Logistic Center worked hard to improve its quality management. ISO certification is granted only after a 3rd party examining organization determines that the stringent process requirements for quality management, improvement and customer service are met. Certification is for a set duration and then the examination process begins anew for recertification. (Click image for more extensive discussion.)

In February 2001, the Reason Foundation looked at the outcomes of the changes at the FAA Logistics Center and suggested that the same results would be possible in a privatized ATC system.

In February 2003, Aviation Week and Space Technology ran an issue about the air traffic control system. It took a hard look at the FAA Logistics Center results and its conclusion was: “fee for service system in other parts of FAA could benefit the National Airspace System and the traveling public.” When others looked at the Logistics Center, it was evident that ATC privatization would work.

The solution to the problem was to perform a virtual privatization. The Logistics Center would be taken off the federal budget and put into a revolving fund. Rather than get its funds and salaries directly from the federal budget, the Logistics Center would get revenues from sales of parts and services to its customers. The FAALC workforce was put at risk; it had to generate sufficient sales to cover payroll and its operating costs. Other than a commitment to a brief transition to cover payroll for the first two years, there were no safeguards. We put everything on the line. And the workforce was ready to take the necessary steps to achieve success.

The following short list itemizes some of the many, many changes initiated:

Management partnered with the largest union to make the huge number of changes necessary;
10% of all funding was re-budgeted to pay for training, changes, and equipment;
Each employee went through commercial financial, change management, quality, team and other training to prepare for changes;
Measures to achieve ISO 9000 certification within 3 years were instituted;
Commercial financial practices, accounting, and measurements were substituted for the government practices;
Ultra stretch performance objectives were established and appropriate measurements created, with monthly and quarterly performance targets closely monitored;
The Chief Financial Officer of the largest national food distributor in the US at the time was hired the day he retired from that company to convert the Logistic Center’s entire financial accounting, tracking, and management systems to standard commercial practices, and all managers were trained to perform as business managers; and,
Too many other initiatives to enumerate here.

On November 25, George W. Bush awarded the Logistics Center the Presidents Quality Award/Award for Management Excellence, the highest quality award in the Nation. Norman Bowles, who led the turn-around, received the award for the FAA Logistics Center.

“This award is like what we call the Malcolm Baldrige award. The Malcolm Baldrige award recognizes excellence in the private sector; this award recognizes excellence in the public sector. It honors really high management quality.” President W. George November 25, 2002

The Malcolm Baldridge Award and President’s Quality Award are identical. The examiners, final selection criteria, and awarding organization are the same for both awards. In 2002, the name was changed but the criteria for selection were unchanged. In 2009, the government award was discontinued.

The transformation was astounding. Listed below are just a few cursory examples of the outcome. They don’t begin to reflect the magnitude of the change. It is better to view the links and material surrounding this discussion to understand the scope and impact of the results.

Efficiencies reduced workforce size from about 800 to about 600;
Average delivery times went from weeks to days;
Product reliability and quality increased as rework dropped to near zero;
Customer satisfaction levels reach 95% or higher;
ISO 9002 certification was attained in less than 3 years;
We barcoded $1/2 Billion of inventory; modernized the distribution center; and, for the first time in its history, the Logistics Center got a clean Office of Inspector General audit;
Forcing the customers to pay for parts rather than getting them for free saved FAA 20-25% the first year the conversion occurred;
FAALC received the President’s Quality/Malcolm Baldridge Award for quality and management excellence;
Too many other improvements were achieved to list. The surrounding links offer an idea.

A question to ask is, “Would what worked in the Logistics Center work with the Air Traffic System?” The Logistics Center had only 600 employees, and the ATC system has 25,000. It is easy to answer this question.

Canada’s Air Traffic System Was Privatized! NavCanada is a privatized air traffic control system in Canada. It has slightly fewer than 5,000 employees. According to Wikipedia, “NavCanada manages 12 million aircraft movements a year for 40,000 customers in over 18 million square kilometers, making it the world’s second-largest air navigation service provider (ANSP) by traffic volume.” It is a high performing organization and its employee satisfaction ratings are extremely high, plus it is rated among the top 100 employers to work for in Canada.

Nav Canada is rated extremely highly as an employer by its employees. Do FAA employees give the agency the same rating? (Click image to see.)

FAA's ATC system pales in comparison with AT&T's wireless system. (Click image to get an indication.)

Compare the Size of The Air Traffic Organization to Mobile Phone Companies Would what worked for NavCanada’s 5,000 employees work for the 25,000 employees in the ATC system? T-Mobile has 50,000 employees and provides even larger and just as complex services as FAA’s ATC. If that is not scalable enough, AT&T has 250,000 employees. For those who still want to question whether AT&T has services as complex FAA’s ATC system, simply click on their logo. (Note: this is not intended to be an advertisement for AT&T, simply a means of illustrating how specious the “scalability” argument is. Wouldn’t it be wonderful AT&T’s pace of modernization was applied to the ATC system?

Our Nation deserves to have the best and most modern air traffic control system in the world. Right now it is a hodgepodge of antiquated or poorly functioning systems held together by FAA’s hard-working field maintenance workforce, and it is operated by dedicated air traffic controllers who deserve better. This page shows the radical transformation that privatization has brought to space, airports, and the FAA’s Logistics Center. We’ve seen what a private wireless industry delivers to our Nation each day. The potential of privatization to create a modern, efficient, effective air traffic control system is no less. Simply, it should be privatized for the Nation’s good.

It is difficult to see how anyone interested in the Nation’s health and benefit can be both knowledgeable and opposed to this change. Perhaps their vision is limited, just as those who said that the private sector could not afford to match NASA in scope or achievement. Or they think the ATC system is a national asset best run by the government, the same thinking as those who opposed privatizing the two Washington DC airports. Or perhaps they are concerned about local jobs or airports, hardly a worthwhile consideration when the Nation’s air safety is at stake. Or perhaps they simply don’t think that the federal employees who worked under the old system, can do any better under a new and different system, the same way people said the Logistics Center workforce could not change. None of these arguments hold up in the face of what has been shown here on this page.

Let’s Just Do It!! It’s time to move on! Let’s bring our air traffic system into the 21st century. Let it be comprised of the technology of tomorrow, not of NextGen equipment that will already be obsolete by the time it is deployed. Let it not become like Denver’s VA hospital that promises continuing cost overruns. Let’s do the right thing and privatize it!!

If this page persuades you that privatizing the Nation’s air traffic control system makes sense, forward this page to your friends. Definitely, send it to your Senators and your Congressman or Congresswoman. http://www.commercialspacetransportation.info/privatization/

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