Rebuilding American airports is a priority for many cities across the country, because they have clearly fallen behind the times. In fact, tourists from other countries are often aghast at our airports when they arrive from other industrialized countries.
Often, the first impression that a visitor gets of The Greatest Country in the World is a rundown and overcrowded terminal in one of our famously derelict airports.
President-elect Donald Trump has emphasized that modernizing our infrastructure is one of the overwhelming priorities of his administration. While some of the most grotesquely out-of-date airports in the country are already being improved, like Chicago’s O’Hare, Los Angeles’s LAX, and New York City’s LaGuardia, there is still much work to be done. In short, our aviation infrastructure is pretty messed up.
There are many layers to our airport infrastructure woes. This article focuses on airport facilities, but there also investment needs elsewhere. For instance, our air traffic control system is in desperate need of improvement. That’s a barrel of monkeys that we’ll save for another day.
In short, the structure of governance surrounding airport finance is perhaps the biggest barrier to improving our nation’s biggest airports. Many municipalities operate their own airports, which means they often have their hands tied by local politics.
Raising taxes on local citizens or increasing indebtedness to improve an airport is extremely unpopular. Perhaps locals wonder why they can’t just raise taxes at airports, and there’s a reason for that: federal law limits their ability to collect revenue directly from passenger fees.
Airport politics are also national, since the revenue they’re legally allowed to collect is severely restricted by congress. Passenger facility fees are currently capped at $4.50 a flight, and that hasn’t been raised since 2000. Any changes to these laws would require a congressional seal of approval.
Interestingly, major airlines are leading champions of fighting increases in airport fees, because those costs would be passed on to their passengers. Some analysts see this as extremely shortsighted, because in the end, airlines suffer greatly because of our inadequate airport infrastructure.
In all fairness to the airlines, there are already an insane number of fees, including the 9/11 security fee, international arrival and departure taxes, etc. Askthepilot.com points out that “airline tickets are taxed at a higher federal rate than alcohol and tobacco,” so new taxes aren’t exactly going to help the problem.
The solution to improving our airports involves large injections of cash, to the tune of tens of billions of dollars in the near future. In the end, someone is going to have to pony up the cash, because we can’t continue to live with “third world infrastructure.”
Everyone wants better airports, but no one wants to foot the bill. In the end, a combination of federal, state, and local cost sharing with some help from the private sector could be the solution to our problems.
Air travel is going to have to get more expensive for regular people if we’re going to improve our nation’s airports. We’re also going to have to explore public-private partnerships that can help local governments take on these gargantuan projects. Some of the best airports on earth are privatized to some degree.
If the Trump administration wants to improve our airport infrastructure, they’re got their work cutout for them.
Cross-Posted from GenFKD.org
Header image: Shutterstock
David is the Editor of Bold. He's especially passionate about millennial economic empowerment. A former local news reporter, David is originally from the Little Havana area in Miami, and later became a pioneer resident of the Disney-inspired town of Celebration, Florida. David holds a Master’s in Public Policy from the Harvard Kennedy School.
Founded in 2013 as a financial literacy organization, GenFKD is growing into an organization that’s revolutionizing American higher education. Through skills-based training and student-first reforms, GenFKD is advancing a system of “new education” focused on improving post-graduate outcomes in areas of gainful employment, financial preparedness and entrepreneurial readiness.