Unfair Competition Costs US Jobs

The Export-Import Bank (Ex Im) was established in 1934 to encourage US exports by providing financing and insurance towards the purchase of US manufactured goods by foreign countries.  Ex Im has become even more crucial in recent years as President Obama has set the goal for the US to double exports within the next few years.  Ex Im will play a major role in this by allowing international buyers to by US products when they may have been previously unable to due to unwillingness to accept credit risk or being unable to pay high interest rates.  Ex Im insures these buyers from the risks and extends loans often well below market rates. 

Boeing aircraft make up a significant portion of the financing Ex Im extends to buyers.  This is the source of many issues for the US airline industry and its employees.  In recent years, foreign air carriers have been placing HUGE orders for wide body commercial aircraft.  Often times, they secure the financing for these orders through Ex Im financing.  Although good for Boeing and US aircraft manufacturing employees this poses a major concern.  Since foreign carriers are able to finance aircraft at much lower rates, they save tens of millions in interest payments per aircraft over the life of the loan.  An asset that costs less can offer lower costs to customers that use that asset.  These air carriers have a MUCH lower barrier to entry than US carriers when buying aircraft, therefore they are able to underprice their US competitors on routes.  This has led to a major loss of previously successful routes for US carriers and a loss of US airline jobs.  Low loan rates, and recent cabatoge strategies have caused major concern among airlines and their employees.  If this issue is not corrected many US airline jobs could be lost.

Personally, I feel that Ex Im is a major issue for US airlines and one that needs to be resolved before our airline industry is jeopardized by foreign carriers.  Although Ex Im does perform some useful services,  things need to change or the bank needs to be dissolved entirely.  A possible solution to this issue is requiring thorough research of the impacts of these loans on US industries before they can be made and setting hard limits on the amount of loans available on specific assets such as wide body aircraft.  Making these loans competitive would set reasonable limits and limit the long term negative effects.  Additionally, setting up an agreement with European financing institutions to match US policies and rates would ensure fair competition between Boeing and Airbus.  ALPA has an extensive report regarding the most pressing issues that US airlines face including this and can be found HERE.

UAVs: A Tool that needs Careful Consideration

UAVs have the potential to serve as useful components of the aviation industry, but at their current level of regulation and use have many issues to overcome.  Until properly regulated, communicated and developed UAVs pose a threat to the NAS, its users, and the basic freedoms of Americans. 

Currently, UAVs are being used in both the civilian and military segments of aviation.  When operated in the NAS for civilian use a Certificate of Authorization must be obtained from a public entity sponsor.  The scary part of aircraft being allowed to operate in the NAS is that there are no regulations specific to UAVs published by the FAA.  Rapid development of the technology has left the FAA with their tails between their legs and unable to properly oversee UAV usage today, resulting in a free for all of sorts.  This technology is distinctly different and requires proper regulation to be safely operated in the NAS.  The FAA “hopes” to have some sort of regulation in place for UAVs by 2015.

This summer I ran into a gentleman in Indiana, who was bandaged up, burned and has bone exposed.  I proceeded to engage him in conversation as I would with anyone else who came to check out my airplane.  Instead of the normal response and curiosity about my Skyhawk, I was greeted with a horrifying story about how he was flying his aircraft over Wisconsin with his wife and a client on board when they collided with a UAV over a VOR.  His wife and client were lost in the accident and he was left badly burned.  At first, I didn’t know whether to believe him or not but the details of the story were too specific and gruesome to have been made up.  The scary part was that he seemed adamant that the Government was trying to cover up the accident by not releasing any details to the public and refusing to provide him with any closure.

Even though they aren’t properly regulated at this point, through COAs, UAVs are being used for a number of civilian uses such as Filmmaking, oil and gas exploration, domestic policing, and maritime patrol.  UAVs will eventually be able to operate in the NAS without COAs.  A great deal of logistical and perception issues will exist when attempting to integrate these devices in the NAS.  Firstly, a primary component of safe aircraft operations is the “see and avoid” concept and this is a concept that UAVs are incapable of.  Finding a way for UAVs to comply with ATC instructions in the NAS is also a huge barrier to their safe use.  Frequently, UAV pilots are in control of several different vehicles at one time. 

Public perception is also a huge issue as you can clearly see with my current opinion of UAVs.  Not only has their ability to safely operate in the NAS without posing a threat to civilian air travelers not been proved, individual liberties are seriously jeopardized.  Many people are concerned with their every actions being monitored by the government through video surveillance provided by UAVs, and rightfully so.  When used for domestic policing, their ability cover wide areas and the low cost of deploying large amounts of UAVs at one time, could result in a police state with citizens worried about being watched by “Big Brother” at all times if not properly regulated.    

UAVs in the military have done significant amount to improve and change military strategy.  Instead of having to worry about putting humans in harm’s way during high risk military operations, UAVs are able to do the same thing without risking human life.    Due to this, the military is able to complete missions that were previously unattainable due to the ethical issues of putting human life in harm’s way.  Although significant development costs exist, both financial and ethical savings will be a long term result of UAVs in the military. 

Careers in the UAV industry will continue to become available as the industry grows and pose significant career opportunities for both flight and management majors. See this posting from General Atomics for an example UAV career opportunity.