[jimworcs]

History is not on our side with this...

United have done a sterling job destroying any ethos of customer service at Continental...and Delta destroyed Northwest. US Airways ruined my favourite US airline (Piedmont). AA destroyed TWA and look like they are going to eat up US Airways in their race to the bottom.

The extraordinary thing about chapter 11 in the US, is that it interferes with normal market forces. Customers decide that an airline is no longer meeting their needs and bankruptcy follows. The market would then allow new entrants to come in and service standards and pricing would improve as they compete to take market share. Airlines seeking market share try harder (JetBlue, VirginAmerica, Alaska)... airlines "too big to fail" abuse their monopolies (Delta, United, US Airways, etc). Instead of allowing this to happen, Chapter 11 protects managers, and allows them to breach contracts, rip up employee contracts, even emerge larger by taking over other airlines. This means that AA has nothing to lose from bankruptcy... but you can bet the senior managers will have huge payouts as they emerge and parachute payments if they leave. Regular crew however, will emerge embittered and angry and this will be reflected in the service provided. Delta are the perfect illustration of this.

What to do:

1. Allow airlines to fail.
2. To protect routes, the bankruptcy administrator can auction off routes, aircraft and slots
3. No bidding airline can exceed 25% of the slots in any given airport.
4. Agree bi-lateral agreements to allow foreign airlines to compete. This would allow well funded airlines to come in an compete with the big boys...such as Singaport Airlines or Lufthansa. This can be done on a bi-lateral basis, opening up international markets for US based airlines to compete.
5. Re-regulate the airlines, setting minimum protections for customers, including fairer and more transparent terms and conditions, with compensation. The model of Regulation 261 in Europe would be a good start.

AA filed for bankruptcy with cash reserves of over $4bn. This is a device to screw their suppliers and rip up employee contracts. It has nothing to do with improving services for the passenger.