>>

>> that is the accounting that the faa has in the current budget. as much as we wish it would the budget picture will not change we will see more and more spending restraint with the impact of sequestration and layoffs with on-again and off-again stock in star funding from continuing resolutions. that is what the faa is confronted with nobody could or would bill the major new technology projects with those types of challenges. here is the headline from last week and though it causes heart ache but commack the faa is not delivered as promised''. the first of the modernization that is why change is needed the consensus of the

stakeholders was we need to restructure to a government corporation for a nonprofit organization that has stable funding and the ability to control and finance the march to modernization we have now reached the tipping point i am not the typical spokesperson to come to the table to suggest that is the case i would weigh in to have the agency do it there will not be stable funding to move to the leadership necessary with the next opportunity for air traffic control by a understand this is not easy to be discussed before but it needs to be done now. a number of other countries have done this successfully in so cannery. we know the history data and

'03 will learn to fly dash pc the bonfires for guidance then for ground-based radar and we have not changed me to go quickly and effectively the only way that will happen is of the different structure if a non-profit organization and can accomplish what we want to. one final point to know the word privatization has been used. i did not use it this structural focus from non-profit organizations that i think will solve the problem for this country to insist the government retain anb is stakeholder in a new organization. mr. chairman thank you for the invitation is a pleasure to be sure.

>> thank you senator dorgan spent a thank-you chairman and ranking member and members of the committee 40 opportunity to be here for the nation of the air traffic control system for users of air space in passengers and employees and the many stakeholders across the country that benefit. airlines for america is dedicated a tremendous amount of resources time and attention to a fact based study of air traffic control reform including a global survey of proper service providers. all of the work points to one conclusion, the american air traffic control system needs a complete transformation to modernize to meet the demands of the future a of the time is now. we cannot continue with a status quo. today all users of this

system is behold and to the world were to era system that is inefficient. for decades policy-makers and stakeholders unanimously recognized the need for modernization. long string of reports from commissions dot inspector general a gao and independent private sector experts have found the faa progress has not met exhortations calling into serious question in the agency's ability to deliver on its mission under the current structure. the problem is not the work force or the leadership of the funding and governance that we must fix many countries around the world have successfully transformed their own air traffic control system. we have done extensive benchmarking we show the six

basic success. number one is separation of the operation of the atc safety regulation function number to a nonprofit corporation with independent multistate kohler board of governors free from political influence. a professional management team incentivize to pursue efficiency without numerous constraints imposed on government agencies. number for a self funded user fee model based on the cost of services allowing access to capital markets and a steady predictable stream of funding not subject to budgetary constraints. number five. managing assets and capital investments with far greater speed to market of

technological information in which user fees so they know what they pay allow them to have full ability to recover cost. under their transformed atc system plus any new fees to fund the remaining should not exceed the total tax burden of today. with independent governments and operation and funding of the atc system the faa could turn the full attention to safety regulation and oversight for the transform atc system could maintain safety as the utmost priority while creating efficiencies delayed reductions in the environmental benefits for the inefficiencies the delays and the cost will only grow over time so there is no better time to transform the atc system than now we are capable to

rise to a challenge as many others have before us if we do this methodically and thoughtfully well as giving proper consideration to risk mitigation the results is a modernized air navigation service provider to better deliver the benefits to the users of the system of employees and passengers that they people of this nation expect and deserve. >> thank you. >> mr. chairman is editors of the committee thank you for the opportunity to testify that this hearing to discuss the future of our aviation system. riyal have a stake in the national airspace the economic engine contributes 1.$5 trillion to the gdp provides over 12 million american jobs. reinvented aviation as an american tradition over the last 100 years we have created innovated

implemented the unbelievable for current labor you run the largest most complex diverse system in the world it is income parable nine equaled and unrivaled by any other country. for example, the next largest aerospace is canada they have 12 million operations per year on average we have over 132 million operations per year the united states air space systems is considered the gold standard in the community by yet the reality is to keep that honor changes needed. currently we face many challenges to respond to a given problem so unpredictable funding stream concluding the inability to finance long-term projects the inability to grow the airspace for new users the ability to modernize the

aging infrastructure currently our centers throughout the country are over 50 years old with no plan to replace them. their struggling to maintain proper resources at the air traffic control facilities are certified air controllers are of the all-time low the of coming bill must address the lack of the of predictable stable funding stream for the hypercritical safety aviation operations and. we'll understand this stop and go funding problems leads to an examination of a structure change and we believe it is time the current system is not dynamic enough to address the needs of air-traffic control operations in the future but any such change reform must be carefully examined to prevent the unintended consequences of safety and efficiency of national airspace system

every stakeholder should work together to make sure the united states continues to be a global leader in aviation. any reform must address the safety and efficiency of the airspace system to be misunderstood to provide a stable and predictable funding stream. to adequately support staffing inspiring. any change must allow for continued growth in the aviation system and must be dynamic to provide all services for all segments of the community. any change that we make needs to be precision like to interrupt the day-to-day operation of the airspace it is an american treasure. aviation is uniquely in american tradition. we cannot continue to shortchange it.

we're still currently recovering from sequestration cuts of 2013. another round of cuts better set to take place this year will shrink the footprint for ever we need to make appropriate changes to secure a stable funding stream and establish a proper governance structure that is not laden with your credit lines of business or burgeoned with bureaucratic process we need a dynamic structure that will allow was to grow aviation and not shrink it and to modernize facilities and equipment procedures in a realistic time frame to give us the competitive edge to ensure the future leadership in the global aviation community. thank you for the opportunity to testify collophore to answering your

questions. thank you. >> mr. chairman and members of the committee general aviation is an important industry representing target billion dollars to our economy with over 1 million workers business aviation unit states foster's economic development and small town and roll committees and helps companies of all sizes be efficient and productive to help with a humanitarian efforts whether responding to forest fires or flooding or transplant organs. we're honored to be here today. we represent over 10,000 member companies of all sizes. and in all types of industry we represent hospitals, universities and nonprofit.

85% of the numbers are small and mid-sized generally operating out this small towns and secondary markets generally flying tour from an airport with no commercial service. business aviation is fundamental to the economy smalltown and mid-sized communities in the united states. typical of membership status:washington schweitzer is a high-tech engineering company in a community with very little commercial service. but it can compete effectively in the international market because it has access to business aviation. mr. chairman, every member of this committee has a company like schweitzer in a community. as a matter of perspective

there are fewer than 500 communities in the united states with any type of airline service. 5,000 in the communities that rely on business aviation for support. the faa reauthorization bill has a lot to do with communities and companies like those. because the airspace above our heads belongs to the american public not to anyone stakeholder or industry segment the air transportation system must continue to serve all americans across this country the question on the table the fundamental question of reauthorization is who will ensure that the public airspace serves the public benefit? will it be the public elected officials?

or a combination of self interested parties? for decades suggestions have been made that congress wash their hands of the air traffic control system. to give over to other parties taxing authority to determine if you can access airports and airspace. this is something pushed long before next gen was the concept in before sequestration they have wanted sweeping authority to determine who gets taxed and who can fly where and when. mr. chairman the power to tax is called the power to destroy. today that authority resides with the elected officials for also the power to insure nondiscriminatory access to airports and airspace. congress should not abdicate

or relegate delegate or outsource its authority over taxes and access to. the congressional research service said to do so could become such -- and constitutional united states has the measures the largest and safest and most efficient and most complex and diverse air transportation system in the world. but the business aviation community is not content with status quo and no american should be. to be the best today does not mean the customer and complacency is our enemy. that is why the business aviation community has been active and outspoken for its support for next general industry segment has done more. we have invested in technology we urge congress

to do the same. serious problems to exist with the nextgen program programs have been delayed and implementation has been slow. we still have a lot of work to do to certify technologies it is time to focus like a laser on those problems. it is time to not be distracted by what we need to do. we need to use the faa reauthorization bill to make sure we make nextgen a reality and improve the certification we are protecting our nation's system of airports to certify end employment and integrate in a safe way there is a lot of work to be

done the member companies look forward to working closely with you but let's never forget the public airspace should serve a public benefit. >> thank you mr. bolen your very efficient everybody came very close to the five minute rule even hour former colleague. [laughter] over the weekend indicating is security research claim could barely take control by hacking into the in-flight entertainment system of true it is a disturbing incident and to analyze those on passenger aircraft? >> so what they are finding

is as it relates to the larger question of cyberit is something we've looked very carefully at that only in the operation of our system to how it changes for those rare of security to access to critical systems but a cyberis it will continue to be a challenge not just with aviation and but a technology based sector tuesday ahead of. >> nothing to report at this

time? >> the academy's student would require significant effort with those challenges going forward. to talk about that issue with the agency's efforts with the government faces of the private sector employers? >> do we offer a competitive job and composition? to ensure the net debt it is important 2.0 there is a significant portion of the pool interested coming to work for the faa because of their belief of the mission in public service.

>> we will never paid the top salaries that top technology companies pays so the focus to have an orderly process. >> to be interested in the cybersecurity support to begin touched with that subject. to turn back to the subject at hand talk about status quo is not be acceptable situation. in bed with the system of the courage government model >> we have been studying the last 18 months the other

countries when they broke off air-traffic control services from their government entity some have done well summer struggling. what we are looking at is a funding stream to change the structure was a thing we know for sure that we don't want is to put another hurdle in front of us to provide the most efficient system is the world's. >> there is a lot of discussion as the model for comparison. to a understand with some reluctance to copy that effort to that he finds most appealing. >> i was there last week to look at the technical center

to have day true collaboration to develop a the nextgen technology to work together from conceptual stage through training and implementation and deployment with their facilities to save time and money with the 30 year time frame because of the procure reprocess. >> in the context of the independent services provider some of the referenced of preference several different models. can you speak to the difference of a federal corporation or federally chartered nine profit from

the approach? >> reconvened this group in the consensus was a nonprofit corporation allowed to maximize shareholder corporation but also what happened is the ability to have that bombing authority to talk about the nextgen capital project we we're done in a fairly short period of time to continuously improve. it is the entity but i would say those people tend to

rely on the nonprofit corporation with the shareholder management if you will. it gets you the most bang for your buck and gets us out to the edge where we are not today. >> mr. cherry have submitted a research document for the folks that were involved have produced this shows the strength and weakness for what other countries have done but what it has indicated is the most important point the stability of funding of this type is essential i served in congress 30 years in the lot i don't know but in the

time of spending restraint is an sequestration and multiple continuing resolutions there will not be stable funding for this type of project in the future unless it comes through a bonding capability through another organization. i support and belief this will not get done unless we decide to do in a different structure. with the input including the of government. >> the user fee structure as was mentioned as a stable stream of funding with

stability and second this is governed by the board of directors from the department of defense said u.s. government the air carriers said union representatives said they are present with fiduciary duties and let not the employees with those fiduciary duties. also of the efficiencies driven from a nonprofit corporation we have evidence from canada to the north. and with that management

with the ability to attract and retain a workforce including cybersecurity experts. in that's enterprise is free of the political influence found today's. >>. >> i want to follow-up with the introduction of cyber attack. part of what we are looking to do with this next generation is air-traffic control of the of satellites you can be a lot more efficient and a lot more awareness from the cockpit

from the other airlines with that transition there is the question of the back up of the ground-based radar. so what happens if there is a cyberattack:the gps to shut down with mr. smisek with the ring true that you talk about who would bear the cost of the back up since that is the last efficient operation and? america i am not an expert on the cybersecurity but it is necessary in any enterprise to have paid very

expert investment. it is a risk as we become with the attack, and the gps system it would affect everything. >> given the private corporation. >> if as a result of concerns that were sufficient with the ability to bring down the gps system of which i have no knowledge at all. . .

>> that is one of the costs. mr. administrator, why is dod weighing in on this so heavily? they are concerned about this privatization? can you speculate how privatization would impact there relationship with dod? would you be able to interact with a private entity or nonprofit corporation in the same way

that you have existing opportunities to interact with dod? >> sen. nelson, i can certainly speak about the relationship and the working procedures that we have with the department of defense as they exist today. they are an they are an important partner in the provision of air traffic control services and they control certain airspace in the country. we control certain no space the country. we have a shared responsibility for an efficient and effective management of the safety of the air traffic control system. we often we often take advantage of the airspace they use exclusively during peak travel time to overcome eight additional traffic loads and work collaboratively with them to ensure that they have access to airspace that they need for their mission requirements for training. >> i understand you were collaboratively with the. why do you think they are

weighing and so vigorously? >> i cannot speak to why they are weighing and but what it ultimately depends upon is what would be the structure and an alternative model under which they would interact with their partners in the air traffic system? it would strike me that there would be a way to build protocols but it is entirely dependent upon the structure selected. >> why are the general aviation business manufacturer so concerned? folks like breyer -- we will go through all of them. gulfstream cessna etc. >> the business aviation committee as i mentioned earlier 85% of our members are small and midsize

companies flying into and out of airports with little or no commercial airline service. and so they are concerned about their access and are concerned about ensuring that their access to safe predictable, and affordable. i think one of the questions that came up earlier was financing the system. what we heard is that one of the plans for the future is to have bonding authority which is a euphemism for borrowing. the reality reality is what we have today is our system generates a largely but not entirely self-sufficient system. we have a combination of user funded taxes plus a general fund contribution they currently funds the faa the question on the table as if we pull it out me will have a situation where all of those industry charges don't equal the amount we have today we can either

raise good taxes to get to that amount, cut the system to get to that amount we will as you have heard go borrow the money. borrowing money comes at a cost. that has to be serviced. prolonged borrowing ends up creating an interest nightmare. there are issues that must be addressed. what we want to do is make sure the small towns and rural communities, secondary and tertiary communities are able to have business aviation located in their communities and are able to access airports and no space in major markets such. >> thank you. >> thank you. let me just begin. is every witness a part of this working group? >> no. >> i tell you what. i think this is an excellent

report. kudos. would you do this? in reading through this at some time there needs to be a page where the owners take ownership command i don't see that. we checked the website. spread that on the record for us. >> happy to do that. >> there are three -- are you part of this working group? >> we were part of the working group but did not feel our concerns were being reflected. we are no longer. >> that is probably accurate three options involve major structural change. an independent nonprofit and private for-profit. the 4th option sort of basically tells congress that we ought to do our job.

get the funding straight and make sure that it is reliable and steady. the 4th option system funding stream maintaining the system current government structure going on to say that this option could alleviate transition issues that are concerned with completely knew government structures. fair to say that your organization is more in tune with that 4th option. >> we have studied various structures around the world. we have looked at australia, new zealand, england, canada in none of these markets do we see a robust business aviation community that is providing economic development in small and rural communities. serious access issues. australia business aviation

is not allowed access to airspace in melbourne or sydney on a prioritize basis at all. we all. we end up waiting sometimes three, four, five hours on the tarmac for access. i was on i was on a panel recently with the head of the irish air traffic control system who said he just have to understand you will get priority. that is part of the natural selection process. as we have looked we saw after an economic downturn that privatize group needed a bailout from the taxpayers. canada has instituted user charges while continuing fuel taxes. what we have seen as we look around his a lot of fundamental problems with some of the different structures, and we want to make sure in the united states we identify problems

and finding targeted solutions to them. to simply to simply say we will pull this out and give it borrowing authority leaves concern about our ability to safely, predictably, and affordably access airspace and airports >> you are saying that the united states is unique in that we have the 5,000 communities that rely on business aviation as you mentioned and that access will not be the same if we go to one of these three structural changes. >> our study of the systems around the world has taken this action in a serious access and affordability concerns. >> it sounds like you have a good.there. >> it depends on who is listening.

>> i i spoke on the importance to the country. but the question before this committee is are we in fact going to have the system built and completed? the answer is without a change in structure we will not get their's. there are a lot of opposing interests. i will give you a list of everyone who participated. but you can't reach everyone because everyone has their own set of interests that they bring to these issues. i mentioned that this is a heavy left. we didn't put together a pattern for important reasons. we would not have gotten

agreement on a specific pattern. once asked if he would engage in a debate. zero yes if i if i can take the negative side. the negative side takes no preparation. look i understand that this is big and controversial and will make one more.if i might. >> one more. >> he came to our organization. he was not a participant but we invited them. i have great respect for him that is why we invited them. all of us should want the same thing. there will not be stable

funding in time is spending restraints which will probably include sequester uppermost in the budget as we saw it is year because $365 million out of we equipment account trying to climb this hill of in the modernization. >> a stunning indictment which may be correct. this one quick.most several weeks ago april 14th you appear before the full community on a similar topic faa reauthorization. we asked questions for the record particularly with regard to the contract our program still awaiting details and look forward to receiving answers.

>> absolutely. i think we're trying to schedule a step briefing to go over the methodology. >> okay. if we can squeeze those questions in. you could have answered them right on the spot. but do your best. we served together in the state. i i was a state senator. i recall you coming before me on the finance committee. here we are just a different capacity. it's great to see you again. i would like to pick up briefly on senator workers comments.

as i heard the testimony concerns about funding and budget. that 4th option it falls back on congress that we are not doing our job here in providing the resources necessary. the proposals put the proposals put together. that is where focus needs to be having said that i have a question. i understand the 2nd largest air carrier has a major presence in my state of michigan major have as well as a large employer has declined to endorse the a a4 a position that you have been advocating for today suggesting the current system can become more efficient and deliver substantial benefits through improved collaboration efforts. delta fears that separating vat see system would lead the operational risks and

pitfalls bureaucratic silos unforeseen costs that will accompany the transition and the loss of expert personnel a long list of concerns. please comment on those concerns and whether you agree those in the risks are ones that we need to consider? >> i would be happy to's. as you can imagine like congress we don't always get unanimity. however, we do except for one member. that member has expressed its concerns. i will say that i think that our colleagues at delta have no evidence that the fa can

become more efficient or deliver effective services. a perfect example of that. today the best technology in the world. i think you would agree. they they brought down the cost of the system to the users by 50 percent from our model of safety and are selling a technology to 3rd parties because they are so adept at working collaboratively with unions, working collaboratively with experts attracting and retaining experts. i would say that lacks evidence. in terms of risks of transitions of course there is. what we know is what we have today does not work. we have candidly little to no confidence that there will be a stream of stable funding for the ability of

the faa to attract and retain to implement stakeholders in collaboration. collaboration. this nation should reach for greatness and this is an opportunity to do so. if we keep doing the same thing we have been doing we will get what we deserve. >> administrator under the center proposal adc has spun off. the government must maintain a role in governance's. since the faa is the guarantor of the public interest. the role of the faa to put safety of the traveling public 1st.

are you concerned this might be diminished? >> well, i would envision that there would be a couple of different roles. the question of who oversees the safety. under under our current structure today we have an independent safety organization that provides safety oversight. with respect to some of the other questions that have been raised relating to access to the system or ensuring the public interest those interest those are all questions that would need to be carefully considered by this committee 's and would need to be reflected should there be a change in the governance model and whatever structure is put in place. >> i think it is clear and certainly in the expanded testimony i submitted it is

clear that the faa remains the safety -- they other regulator. i think you get better regulation by separating. right now we have an inherent conflict. they are judge and jury. i think that the separation allows them to do their job very effectively as they do in a lot of areas. there is a benefit in many respects to that command i don't think there's ever been a suggestion that somehow safety -- we are talking about the air traffic control system itself the operation of it the vision for it, the leadership has to come back. the other thing we need a more effective way for the faa to modernize its own

procedures. now they focus on that and get up-to-date on things where it does help improve the way we fly the way airlines manage operations. literally rules being months of my years behind. the ability to have a separation division of labor is one of what i believe to be the benefits. and i would suggest also as you pointed out in the structures it really isn't -- it is moving to a government corporation. a nonprofit corporation. far different than a private enterprise. >> first i want to thank all of you. i think we look at the sizable we are dealing with your.

i heard i heard all of you and all your statements and thoughts and beliefs and what we should be doing. statements coming from you all does not work. when you start looking at the size canada has 42 towers and seven centers. france. france, 82 towers five centers 16 towers for centers. mexico 58 hours for centers. united kingdom 16 towers and to centers. united states of america 512 towers 21 centers. they don't even come close. how are we saying the system does not work and we are not able to maintain? the most used in the world. let me just go. my little state of west virginia told us that if you

deregulate it is going to improve air service in rural west virginia. we were told that. a pioneer at that time's. 122 air force 86 of them are private strips. only seven of them have commercial flights and seven have towers. this is diminished because of the what's going on. and i'm just looking at the situation to where we are supposed to be improving a system by privatizing it. in some cases i have been all for privatization. i am also for public-private partnerships. they still come under the purview of the faa told that they are in a private stream. that seems to have worked in west virginia. our towers would have been eliminated.

five would have been gone. i'm looking at everything. go home and explain that we are making the system better and and start charging. if it wasn't for aviation we would be out of the communication completely. little towns were not have any industry whatsoever. they cannot go back and forth. with that if we take congress out of the equation and spin off the air traffic control system to some nongovernment organization how would that speak for rural america? >> sen. no one is suggesting that the government not be a a stakeholder in whatever is proposed. i do not support privatization. but i spent a lot of time on this committee talking about how you can fly twice as far for half the price.

you are talking about a different subject. you and i agree on that subject and it has nothing to do with the question of how you move airplanes' from one airport to another and whether we will continue to use a world war ii ground-based radar system or whether we will move to a different type of system using modern technology. this is not a question of what is but what will be. there is no conflict at all. unbelievably safe system. no conflict in saying that and observing that we are not moving as rapidly as some others are in order to embrace the knew technology and retain america's leadership. i met with the europeans and others will retain our leadership. they will not be funding to do it.

i believe we need to find a new structure but not one in which the government is not a stakeholder. >> sooner or later we will have to get a budget that works for this country. we have not done that because the political toxicity of this place we call washington has got to change. we can be picking and choosing. there have been reports congressional research service highlighted constitutional concerns of what we're talking about. one of my biggest concerns is the delegation of taxing authority to an unelected unaccountable board of directors to adjust user fees and living in taxes. often driving federal appropriations. i would ask any of you all here do you think it is

legal and appropriate to relinquish a constitutional authority? >> i don't purport to be an expert on the constitutional law. this these structures designed to cover the cost of the system. an appropriate reserve fund if there were reductions in travel in terms of the general aviation issues and canada and it can be done here that sticker you put on

your car. it's a process. today's the proportion of fun -- funding. we see the vast enormous efficiencies that can be driven from a nonprofit corporation. >> the amount of money being generated today from industry is less than what the faa costs. it's all the same thing.

funding the system have to go up or as has been discussed we can borrow the money if we can do that we would need to know pretty clearly what we are going tomorrow, what we will get to know when it will be ready, how we will pay it back and who will pay back. this authority tax was set by the 1st chief justice of the supreme court to be the power to destroy. we are concerned about that. we have heard some of the press announcements. cost shifting is been part of that. it it is a concern. >> the gentleman's time has expired. >> thank you very much. welcome back. it is good to see you. you. i was just at the canadian embassy with the premier of

ontario talking about some of there funding. .. smaller airports on public safety and other things and i wonder how compares to canada and compares to what they have done with their roads and bridges and some of that which i found an interesting model.

mr. rinaldi. >> thank you senator. i don't call myself an expert on this but i have been researching and canada along with the u.k. and mr. leah system. as far as from what i know of the system they haven't reduced services. that would be one of the things i would be deeply concerned about. they moved out of air transport canada which was their government structure in the early 90s and they started to transition about 1994. it took about five years to go through a full transition. it was a big transition that they went through and then stood up there corp.. they do have as ed bolen would say they did keep their gas tax and that is to fund the safety and regulatory function that still remained in government and established a user fee of all

the users in the system. >> and as i was looking at someone else brought up the delta letter since they have been out front on this. they talked about increase in the provision of service cost increases and airports look up to make up the trust fund money. this is a different model but in canada. any comments on that? >> i could speak to the u.s.. the amount of money that is raised from tax structure pays for the entire traffic control system that contributes additional monies to the operation of the faa and we don't propose that would change. i think the 15 year average of the fund contribution is around $3000 -- $3 quintillion so with user fees to run the system initially it would certainly be with the current level of taxation a portion replaced by

user fees and a portion retained by congress there would be money that with continued to be contributed to the faa whether that would go into their aib or the general faa -- >> in this reform system would you be willing to pay more? >> we would certainly from the u.s. aviation airline industry we are as you know one of the most heavily taxed industries. we are taxed like alcohol and tobacco like a sin and we are not a sin. i believe over time personally based on air canada and air canada model that the user fees would actually go down because of the efficiencies that would be driven and operating system for example canada has gone down by 30%. >> senator from the business aviation perception it looks

different in canada than in the united states. they don't have a lot of the small and midsize companies in the small and midsize communities that we do in the united states and as paul mentioned they do have user fees and the feel top -- packs up there so a double tax situation and it's fundamentally different because in addition to privatizing air traffic control they have privatized airports which have their own costs associated with it so for a lot of different reasons we don't believe in apples-to-apples comparisons. >> how would smaller airports fared under this model? i guess i asked the same thing as -- >> from my perspective we are very concerned about that access to those airports and airspace. today received a letter from

operations and are concerned that we copy that model. what we hear from our members operate in canada is a concern about the way it works up there with regard to paying the user fees as opposed to the fuel tax. it's not nearly as efficient. it creates a costly administrative burden and they think it is harmed business aviation. senator dorgan. >> one of the arguments i would make those in the opposite direction that today we have technology that would allow for more airport access services to the small airports that we can't get fully deployed who are running behind and would be of benefit. as i look at this do we like what we have got and are we confident we can do better if we stay the course and if we want to change what would that entail? we are getting into some the debate about what may be in the bill that questions that are being asked are able to be

responded to through some of the work of the center is done in what the reporters looked at. >> senator dorgan. >> i think mr. bolen is concerned about the uncertainty and i understand that. my interest is not in creating a system and we have offered an approach here that doesn't have a lot of specifics. i have no interest in entering business aviation general aviation or small airports. one of the principle issues it here is every major airport has bonding investment so on. i think one of the significant issues here is to give a new structure bonding capability to build the system and a robust way and we have explicitly not

described a user fee or a structure system beyond that and i think mr. bolen and i fully understand his point. i don't have any interest in seeing a system that is going to injure general aviation business aviation or small airports. >> thank you. >> senator markey followed by senator mccaskill. >> thank you chairman very much. it's good to see byron dorgan bachan congress. i spoke along with ranking member nelson senator cantwell booker blumenthal and frank and i sent a letter to the department of transportation asking about airline's ability to engage in personalized pricing. personal license pricing is a practice that would allow an airline to charge different prices to consumers that are trying to buy the same seat on the same flight at the same time time. the difference in airfare would be based upon personal

situations that the airline has collected about the passenger. i and the other members are deeply concerned that if airlines are about to engage in personalized pricing they could discriminate amongst consumers charging customers different prices based on zip codes, income levels marital status or other characteristics. what if for example airlines consumers at good information offered special fares to consumers who live in more affluent zip codes to entice them to travel more frequently while failing to provide the same in lower income areas so mr. huerta the faa publicly refused last year to determine whether discrimination based on income level marital status would constitute unreasonable discrimination. i believe that practice is

discrimination. what can you tell the committee today? >> will the faa revisit that determination? >> first of all senator to clarify the economic regulation and oversight is authority held by the office of the secretary not at the faa and we can get your response for the record. >> i think that's important for the committee. mr. smisek your airline, would you discriminate based upon income status or merit of status or trip purpose? >> sir up what you are describing redistribution capability at a auto which is a technological advance for the ability of airlines to offer through third parties additional services that the customers cannot get today, i don't view it as discriminatory. i view it as pro-consumer.

>> i'm asking are you going to use marital status? >> we have no desire in doing anything like that. for example if you are primary member at united and buying through a third-party site today if you bought directly from us directly on united.com he would be able to get an economy plus seat for free but if you're buying three third party and don't know your loyalty status because of technology today where they are not able to offer that flight for free which is requires you to put through third party and come back to united.com and get your upgrade. >> on train to clarify is that you will not be using income status or marital status so is zip code to in any way in make any of these -- >> senator united airlines has no desire to discriminate. >> that's very helpful, thanks.

we have heard recent reports about cybersecurity threats there are travelers face. one security researcher claims to have hacked into the airline's control systems to the entertainment system changing the direction of the plane. i'm concerned about recent claims that the wi-fi on plains lacks basic security that make it easy for hackers to spy on customers using the network so let me first ask about hacking into airplane control. i know that chairman thune earlier asked administrator huerta about the faa separates and let me turn to you again mr. smisek. what is american airlines doing to prevent hacking into the vital controls of the airline's? >> sir

. once the architecture so it's that kind of management of process and design and money there's no question i would say it's 50/50. >> is interesting i don't know how we ensure we get better at management by just changing the structure. unit look at the u.s. postal service. look at amtrak babies pay these are all examples of things we have done better structures were we have tried to do something other than the traditional this is an inherently governmental function and the government is going to do it to.

>> i would say look at fedex. >> yet but those are privatized for-profit. are we advocating going to for-profit? if that's the case my rural airports are totally host. >> we are not saying that but a private non-corporate is in my mind when i look at some of the decisions made in other countries and how they have approached it, i think they really to me offer that kind of flexibility. the faa is still the rule setter here. they are still the boss but now it's basically in the hands of the private company. one of the things on the funding side mr. bolen said you bond out the markets today borrowing capital at almost no cost anybody would do this. you get tremendous savings by being able to make your

investment now. you would probably build it in three years it would be outdone. >> i am listening to you and i'm hearing highways. we are all thinking about highways right now. they don't have a bill and a highway funding runs out in 10 minutes we still don't have a bill on highway funding. should we do this for our highway system? shall we go through a not-for-profit organization for our highway system and what about our waterways? or we go to a private a not-for-profit corporation for that? >> some of the port authorities are good analogous to that. indiana has done highways in ohio has done something similar. they're aspects and we have certainly done it on bridges in some cases. the mackinac bridge is run by a private authority. >> it seems to me that we could do better on the funding part and we would acknowledge that we

need to do it for infrastructure we need to do something for infrastructure. we are shortchanging our country in a dramatic fashion when it comes to infrastructure and that includes her airways. that is the majority of the problem and i'm skeptical and i know you share some of -- senator dorgan share some of my skepticism and he he was in the front receipt about turning over government functions to private organizations because he did groundbreaking businesses that we did for nearly government functions that went badly awry and we wasted billions of dollars. so i just don't think the structure is a silver bullet. i'm open to this matter mean to sound like this is a terrible idea but it seems to me that what we are trying to do is put a band-aid on a cancer which is the inability of congress to step up to the plate and do the mandated hard job of finding the

resources to fund infrastructure. >> if you'll give me 10 seconds i got into this issue of by looking at how it is to tell the government there's a better way to do capital budget paid absent that are there ways to think about how you solve critical infrastructure questions? this is a discrete one. if we funded this and you start talking nextgen we have been using it we talk to the administration and we talked about hey let's get this done and you could have it done and it was an option they chose but secretary of transportation both parties have supported this. the administration of both parties have supported this. there's a lot of history here. i would like to see the committee seriously consider it and validate a -- which you have astutely jumped ahead and are there other applications? i think they're a ton of them.

>> if i might respond. >> you asked a question that's really important about this issue of management for funding and i will admit i think there are management issues and there have been for a long time. i've been watching the chair of the subcommittee watching what's happening for a long long time but were it not for the funding issue i would probably not be at this table with this message. i honestly think it's a triumph of hope over experience to believe that the funding issue is going to change and that somehow the congress who this year by the way is going to cut $365 billion from the facilities and equipment account of mr. mr. huerta. it's unbelievable to me and that will be magnified by the other sequestration and a couple of continuing resolutions. who knows but you cannot build what we want to build in this country and retain leadership

opportunities in this critical area of air traffic control with this and that is why i've come to the conclusion that we need restructuring of the type that i've described. >> thank you senator mccaskill. senator blumenthal has returned so he is up next. >> thanks mr. chairman and thanks for having this series of excellent hearings and to all of you who are before us today the chairman mentioned earlier that you were a very efficient panel and also a very distinguished and informative one and i want to thank you for being here. i was interested as a writer of amtrak as well as a flyer and some other reports last week in the wake of the philadelphia potential price-gouging among airlines and the terrell meant obviously was a horrific event

and i know you join me in expressing our sympathies to all the loved ones and all who were affected but i wonder whether mr. smisek as an executive for united airlines can you confirm whether these reports are valid or exaggerated if the ftc were to look at these what would they conclude? i just want to mention that a $2309 flight from d.c. to laguardia would be an example of potential price-gouging and i want to just emphasize i'm not asking you because i am pointing to united airlines in any way or form as potentially one responsible or accountable. i'm just asking as a airline

executive. >> i would be happy to respond. let me express my condolences to the families and loved ones of those killed in the terrible tragedy on amtrak. absolutely not. it's eking from united airlines who would never take advantage of an opportunity like that if you view it as an opportunity. no one would do that. it is true that as people book closer into a flight ticket prices tend to go up because those inventories which of course which of course is you know evaporates every time of flight takes off without someone in that seat that inventory disappears and that inventory is priced more towards last-minute business travelers who tend to have a willingness to pay more because they are traveling on business. when you have a tragedy such as amtrak give a sudden rush of demand for the very few remaining seats. >> the increase in prices -- to

the. >> those are last-minute fares and an open inventory reserve for business travelers for people looking at the last minute. what we saw was certainly a surge in demand for tickets. the only available inventory was the last-minute business inventory. >> mr. rinaldi did you have a comment? i would join you in the strong feeling that kind of price-gouging would be utterly reprehensible and if there is any indication i will certainly call on the ftc to investigate promptly as perhaps this committee would have a role as well. >> sir i would join you in that call. >> thank you and speaking of that derailment and the aftermath when rail transportation was stopped i think we saw in the reaction amongst passengers in rushing to

the airlines that the lack of adequate rail transportation has an impact on airline fee systems that are all interconnected and the present air transportation system can become so congested that it simply can't serve all of the writers who are diverted from

we have a virtually full room here, but the public still doesn't seem to be mobilized and this congress seems to be divided. do you have some advice based on your political wisdom and your

experience on how we do better to raise awareness and generate support because obviously both of you have long-standing experience in doing so. >> this privatization is tough but i do have one observation that makes little sense to build railroads in the desert in california when we have the northeast corridor that we truly ought to showcase corridor for passenger rail and separate passenger from freight rail on the corridor. so maybe reining in some of the ambitions of any other parts of the country while we fix the corridor that matters the most would be my thought on that. i would also suggest that the subsidization cost of different modes we heard from since -- mr. smisek air has been heavily tax. it's not necessarily the case. certainly with rail and transportation while states have

been willing to raise fuel taxes we know that form of tax is coming to an end at some point. there is a need for a solution. if we can get into the broader question of tax reform and maybe a few years while we sort out how we are going to fund highways and bridges. that's a big unmet need. >> i don't know that i can offer you much advice except to say we have painted ourselves into a fiscal policy corner. we have a dozen years of more that we haven't paid for and we have so much -- i chaired the appropriations and we have $60 billion of water projects in $2 billion appropriations. it's turned transportation and arrived -- wide array of infrastructure. i think we have to do better on fiscal policy and make investments in the country if we

are going to the country wants in the future. >> i want to thank all of you again in mr. rinaldi i want to thank you for your extraordinary work by our air comptrollers across the country most especially in connecticut. i met with a number of them earlier today and they are often unappreciated and i'm acclaimed heroes of our air transportation system but thank you for being here today. >> they are professionals and they do love their jobs. >> thank you senator blumenthal. senator daines. >> thank you mr. chairman. it asking questions relating to rural america. i had the privilege of representing the state of montana and for states like ours connectivity is so important to grow our economy. broadband connectivity is have allowed us to build world-class technology companies down that are close to flyfishing streams

and mountain ranges and it's a way to attract some of the best in the world to build great companies. but the other part of connectivity is their service. it's a requirement to build world-class companies so they have accessibility to good air services. so for administrator huerta as you continue to examine potential air traffic control modernization reforms i will strongly encourage you to focus on work meant interest when you see any changes. as we look at our states not only do we have the ability to grow great technology companies for quality-of-life of a lot of energy future energy supports us are going to be placed a long way away from urban areas. certainly senator dorgan sees that in north dakota and i see that in montana and other places. programs like essential air service the contact or graham and are critical to rural states like montana. in fact tramontana airports are very concerned we are hearing

about the proposed changes to air traffic control will harm the aip program specific we saw encourage you to undertake consultation with all stakeholders. what specific remedies administrator huerta can the faa provide to rural airports as a considers reforming air traffic control program? >> senator i think you have asked a very important question. the structure that we do, that everyone understands that the program aviation system and a grant program and the aviation structure in united states has always been about achieving twin objectives. first is to have an efficient system that serves the largest number of passengers and second is to provide a level of access to communities throughout the country. and in previous

pre-authorizations that has always been a matter of great debate as you well know between members of congress about how to achieve that balance. that challenge at issue does not go away under any structure nor does any structure alone deal with what those issues are. what you're raising his senate important public post a question to wear as a nation we go in terms of an efficient system and the ability to invest in modernization of that system while at the same time ensuring some level of access. that debate i think is foundational to what we need to be looking at in rehab or station and we dance to that question before we can answer the question of what is the best structure that enables us to get there and there are other questions as well in terms of how we capitalize, how we pay for what we are looking for and

longer-term how we ensure we are keeping those objectives and balance. >> let me go do a similar issue. part of building a great technology company in montana and we have the boozman airport in montana but iran asia-pacific from boozman montana. i'm bouncing across the water thanks to connectivity with the airlines. i'm going to step back and ask mr. smisek if you look at global systems with a great airline like united airlines in the air traffic systems used by other countries what do you see from some of these countries something we can learn to provide best practices and improving systems that will make the u.s. system better? as we look at the north american and united states airspace but can you share comments and how

we can make cars country better based on what other countries are doing? >> sure, i would be happy to senator thank you. what we are looking for in this opportunity is to provide technological improvements which will reduce the time that travelers sit on the runway waiting to take off to reduce the instances of circling airports waiting to land, reduce congestion, reduce fuel burn and we believe the technology -- i think canada is among the best jobs in the world and i believe mr. when all they would that they have the most advanced technology and the happiest traffic comptrollers. i think those are all true things and even happier than yours and by the way some mentioned these were the unsung heroes. we sing their praises daily

because we deal with them daily and they are very professional and expert. but getting back to canada it is indeed smaller. air transport has handled -- is handled sick tour way and as you know from your own history technologies scale is magnificent. i think there are tremendous opportunities. we certainly as they fly around the world there are some systems that are better than others and some foreign countries that handle it well and others that don't but we are very focused on not only maintaining where we are in safety for sure but improving efficiency in the system because even though we are local carrier this system disproportionately affects our operation reliability and customer satisfaction. if we get it right and we have an opportunity to get it right we could have a huge step forward in the efficiency of the

system in the value of the system and to the united states and the economy to consumers. this is a tremendous opportunity for us and this is where we actually have not only a vast majority of our assets but also this is an opportunity for the united states of america where we are citizens and the united airlines and the citizens is to provide the best air traffic control system in the world. >> to see all the traffic and air at a given time is humbling and grateful for what we have the 130 million is the number i believe he used mr. rinaldi. 132 million and that's an impressive number. >> the first question if i may status quo i think is we want to talk about rural america and status quo is one of our biggest

concerns in the airports. if you look at what the faa try to do on the sequester peace in 200013 is that control towers to shut them down because they didn't have funding. a majority of those were contract hours but also the majority of them are in rural america. so that is one of our biggest concerns about status quo. >> thank you for looking out for america. appreciate that. >> thank the senator from montana for looking out for rural america and he and i would probably both agree that at the end of this we would like to see more direct flights to and from south dakota to montana. isn't that right? [laughter] >> very much mr. chairman and i associate myself with your comments. >> i appreciate that i think we have run out of questioners but i do appreciate very much the panel's great remarks. this is really the senate's first foray into this issue of reform and obviously we have to

figure out a way as we move towards reauthorization of doing what's best and i think we all of the same goal in mind this was pointed out. sometimes we have slightly different perspectives about how best to get there but i do think one of the things i was raised in the ability of funding is going to be an important one. that's something in the current budgetary environment that we find ourselves in today that is increasingly challenging. there is an openness to look at models that might rather cope with that issue as well as some of the other issues that were raised today so thank you all very much in the hearing record will stay open for two weeks for members to submit questions and if he could respond in a timely way to those questions it would be most appreciated. this hearing is adjourned. [inaudible conversations]

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u.s. capitol police chief testifies before the house administration committee wednesday about operations. >> for he today that sheds his blood with me shall be my brother became near so file. this day shall gentle his condition and gentlemen in england now shall think themselves a curse that they

were not here. >> one drop of blood drawn from that country's bosom should grieve the more band streams of foreign court. >> sometimes you have to go with the music and the words, the poetic images, the sound and the rhymes and also the way in which senator byrd it you are able to pause and linger over a long phrase and stopping keep going. i think he is really using the rhythms of a language which is something that shakespeare did so brilliantly so he can take english and put it into high gear at one moment and then he can slow down. that's something shakespeare lets you do if you are a politician.

>> goodnight, goodnight. parting is such sweet sorrow and it really is. >> the ceos of american delta and united airlines joined forces to speak out against government-owned airlines in qatar and the united arab emirates receiving unfair subsidies from their respective governments. from the national press club this is an hour. [applause] >> want to to welcome or c-span public radio audiences. you can also follow this event on twitter. use the hashtag npc lunch. that's npc lunch and remember the public attend their lunches. applause is not evidence of a lack of journalistic objectivity

objectivity. u.s. airlines relative to the previous decade at least are doing well. they have been posting profits on lower jet fuel prices and than they have been rewarding investors get d's three ceos look overseas and they worry. they say three carriers qatar -- ser and emirates are undermining fair competition and threatening american jobs. they want the obama administration to request consultations for international agreements known as open skies. they also want the administration to seek a freeze on a passenger service by the three carriers during these discussions. several labor unions are aligned with this effort by the u.s. carriers and of course there is a strong point of view on the opposite side. the gulf carriers say the effort by the ceos is misguided. emirates president tim clark

earlier this year called the airline claims quote bluster and flimflam. the qatar ceo this week said there were no grounds for denying gulf airlines access to u.s. markets. he said u.s. airlines were quote using quote bowling tactics so jeff smisek you lost the coin tossing get the first question. you have been ceo of united airlines since 2010 and elect continental before the merger with united and you are a continental going all the way back to 1995. you now lead the second biggest airline in the world. why are you so worried about three smaller competitors in the middle east? >> first john thank you for inviting the three of us today took up talk about this important issue. this is a significant issue. it's a significant threat to the u.s. airline industry.

it's a significant threat to our employees and i would like to thank the professional men and women for being here today. it is a significant issue in their jobs and a significant issue in u.s. trade policy. u.s. trade policy has had a long history of enforcing rights under trade agreements. open skies bilateral predicated on a fair and level competitive playing field free up distortions such as government subsidies. the treat carriers we are talking about qatar and emirates are not just airlines. they are part of state policy to drive tourism and trade for the middle east and these three carriers are not stimulating

demand. in fact today we have released an econometric analysis showing that these carriers are not actually adding travel. they are siphoning travel from airlines and their foreign partners in a way that is quite detrimental to u.s. jobs and what we are asking our government to do is to invoke the consultation provisions of open skies agreements with these two nations. we are firm believers in open skies. open skies has been aimed boon to consumers and a boon to employees in the wound to the u.s. airlines. but in this case out of 114 open skies treaty's tour being heavily abused and we have spent a considerable amount of time and money initially led by delta airlines to uncover the degree of subsidization irrefutable proof of massive government

subsidies and it's the trade policy of united states just as it would be if someone were dumping steel were dumping soybeans. here it's dumping airline seats united states and subsidized by foreign governments as part of the foreign governments policy to grow traffic to the middle east. this is an very important issue causing current harm. the harm is accelerated. how this movie ends it does not end well. we have seen what the carriers have done to the carriers in europe. we have seen what they have done to qantas, we see what they're they are doing to singapore and we know how this movie ends. it does not end well for american consumers. it is not end well for the professional men and women of our airlines. it does not end well for -- >> you became ceo of american airlines and 25th 13 and that follow the merger with u.s. airlines.

before that you were ceo of america west and now you are seeing these gulf carriers adding new routes and now you want the u.s. government to take really an unusual step of freezing new routes. it doesn't sound like what a competitor would do. why are you taking this strange step? >> it's not strange at all. that is what the bilateral agreement calls for. the request is simply to have talks. we have added to that request that until we can get through those talks we would like to see a freeze. that by the way hasn't happened and we should note simply since we have announced or since we laid out our case in january those three carriers have increased their capacity in the united states by 25%. they are clearly doing everything they can to win the race against the clock because

the reality is we put forward an extremely compelling case. our government can't ignore us and they won't ignore us. they will indeed have consultations and we will have action and those carriers know that. that is why they are adding so much capacity and why they are making comments such as it took us two years to find information solution of two years to respond. those are simply attempts to have as much time to get in as much time as they possibly can because they are aware that there are violating the trade agreement. indeed there is going to be actions taken. while it's nothing that we have done doesn't mean it's strange. we have never seen anything like this. who would have contemplated two countries putting $40 billion in subsidies into three airlines so they either like that results in things that you don't see very

often and that is what has happened here. we uncovered the facts and wear spurs funding accordingly and simply asking for consultation to take place and once they do where certain we will get to a place that works for everyone. >> richard anderson you became ceo of delta in 2007 and he previously ran northwest airlines and you go up way back to 1987 in the industry when you began with continental. you have cited a figure of $42 billion in subsidies that go to gulf carriers. how do you backup the figure when there aren't public documents that anybody can see that will show that figure and then assuming these subsidies are happening down the road you will have to show that they are actually harming you and the industry. are you going to be able to show harm? >> well first on the evidence we started the process by delta

couple of years ago because just by definition daily from élan to jfk if you have been in the airline industry intuition to see you don't need to see a flight profitability system report to tell you that can't work. we kept reading it carriers were saying actually in statements to the d.o.t. that there were no government subsidies to any of these three carriers but over the timeframe of the 10 years of these bilateral relationships they have added -- they have 24 nonstop, 24 daily nonstop and it was counterintuitive because those countries have populations the size of north dakota. so normally to have that traffic between two points it just wouldn't support so we began a

process to try to figure out what was going on. we found their financial statements. we found them in places like malta and singapore but we spread out around the world and actually it's interesting. those countries are required these airlines to file financial statements. ugly enough for me u.s. we don't require that but other countries do and these are certified financial statements that show subsidies that are fully disclosed. so the work we did was not only that but we also did research across all the financial documents we could find around the world. airport financing, financed by the government and we were able to build a really strong case. to put it in a legal framework, we proved subsidies beyond a reasonable doubt.

and you can't refute the evidence. the evidence is overwhelming. the harm isn't immediate and the best way to describe the harm is the u.s. carrier essentially except for two flights a day from united american and delta have access to the indian market market. that is really pretties start when you think about it. it india is a very big country. it doesn't huge trade relationship with the u.s. particularly for i.t.. it has a huge agricultural trade between the two countries but in essence we don't have any aviation trade. we have exited the market completely. essentially what these carriers have done is subsidized government strategies to come into the marketplace to basically shift the traffic off of us and take us out of the indian market. if you think about it u.s.

carriers ought to be in the indian market. it's not sustainable when you have $41 billion worth of subsidy. it's very difficult if not impossible for us to be able to to -- and that's harm his immediate. we have got a good analysis. it's part of our white paper. a long-haul white are the 777 in the u.s. will make out the professional pilots and professional flight attendants and the dispatchers and ground operations personnel jibes about 900 really good actually on a gross basis about 1000 jobs per flight. let me put a 777 or 74 or in a-350 or 787 on a daily nonstop across the ocean it drives almost a thousand jobs for every one of these characters.

those jobs aren't here and the three airlines that you see here today collectively employ 300,000 people. art collective cap budgets are well over $12 billion a year investment into airplanes and infrastructure. we create huge positive trade surpluses for our country. our aviation policies are being violated. the stated aviation policy in this country is we will act vigorously. this is the d.o.t.. we will at vigorously through our appropriate means to defend our rights and protect their airlines to enter the competition is fair and the playing field is level by eliminating marketplace distortions such as government subsidies. in that case. it's time to get on with understanding through consultations with the appropriate remedies are to create a level playing field.

>> i've got a lot of questions and i'm going to combine some along themes right cam. what reaction have you had from the obama administration to your complaint? why would they want to poke their finger in the eyes of key allies in the middle east at a time like this? that is one of the other one is that this issue but the camp david meeting president obama held yesterday with leaders of the gulf state and if not how do you feel about it being left off the agenda of? >> let me perhaps answer at least one of those five or six questions, i don't know how many there were. it is a long-standing practice of the united states government with respect to trade disputes to bifurcate the trade dispute from matters of national security or defense. let me use the boeing airbus trade dispute which is a large trade dispute. by the way the amount of subsidies here dwarf by more

than two the size of the boeing air dispute. there was a dispute with clear allies in european union. there are innate -- members of nato but the government can sit down and understand their difference one lanes for trade dispute in matters of national security or defense. we would expect nothing different from our own government or the governments of qatar in connection with discussions. in terms of the reaction of the administration we have visited with the department of commerce the department transportation. we visited with the white house. we have visited with the ustr. we visited the department of state and we have gotten serious interest from serious people about a serious issue. there clearly are a lot of issues involved.

our government has asked us in addition to the white paper and considerable documentation we provided in january they asked us additional questions which were responded to and we filed with them a stack of paper. when private out it was about that high in response to their questions. they have very good information. we expect them to act on it through the concern we have candidly as we need to act we need them to act on it with urgency because as doug mentioned they are taking advantage of this time. not to add 25% more flights than they had as of january 28. that is a serious issue because the harm his current its present it's happening and now it's accelerating and we also know this harms to the point where it ended threaten existence of -- it has in europe. this is a serious issue but our government is taking it very seriously. >> should this have been on the agenda yesterday at president

obama speeding with the gulf state leaders? >> i don't know the content of those discussions. i would have no way of knowing that. my understanding from the press is those are matters relating to defense and as such i would not expect these to be discussed because this is not a defense issue. >> very practically these are the sorts of issues that should be handled in the normal course separate and apart from those kinds of defense meetings because in a mature trade relationship just like we have with europe and the example that jeff gave with boeing airbus you know there is regular give-and-take in the state department. we have 114 open skies agreements around the world that are administered all the time all of which we support and by the way we support open skies with these three characters? we just have to have actions