Airlines Turn Bad Service Into Big Profits

The Skinny: Worst Summer Ever For Passengers Results In Banner Quarter For Carriers

(CBS)  The Skinny is Keach Hagey's take on the top news of the day and the best of the Internet.

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American fliers, the joke was on you all along.

Rarely a day passed this summer without some news of airlines hitting a new low for service - stranding passengers for hours on the tarmac, losing a record percentage of baggage, thinking up new ways to charge fliers for even the tiniest morsel of food after they're belted in and airborne.

Analysts scratched their heads. Newspapers tried to explain the spike in delays and cancellations with long stories that amounted to "it's complicated." The country's air traffic control system was outdated, they said, and it's going to take many years to fix.

Finally, this morning, the Los Angeles Times shines some light on the situation.

"The nation's airlines were late more often this summer, lost more baggage and bumped more passengers off flights than in any summer this decade. They also made more money. Despite the worst summer ever for air travelers, major airlines posted huge profits as they packed more passengers onto fewer and smaller airplanes."

Profits at American Airlines, the nation's largest carrier, jumped more than tenfold - tenfold! - to $175 million in the third quarter. Delta Airlines said net income quadrupled to $220 million. Profits would have been higher if not for rising fuel costs.

"It was the best quarter since 9/11," said Ray Neidl, an industry analyst. "They loaded up the planes and had better seat management."

Predictably, the LA Times does some head scratching and explaining how "it's complicated" why flying is such a deeply unpleasant experience today. In short, consumers demand low fares (blame JetBlue and its peers), so at the end of the day, they're going to get what they pay for.

Kansas, Of All Places, Fires First Shot In States' War On Warming

What's the matter with Kansas? Is it feeling alright? We ask because, according to the Washington Post, the longtime conservative Republican stronghold just fired the opening shot in what environmentalists hope will be an all-out war by the states against global warming.

Massachusetts, we would have expected. Or Oregon, perhaps. But Kansas?

Sure enough. The Kansas Department of Health and Environment yesterday became the first government agency in the U.S. to cite carbon dioxide emissions as the reason for rejecting an air permit for a proposed coal-fired electricity generating plant, saying that greenhouse gas threatens public health and environment.

The Supreme Court opened the door for such a decision in April, when it ruled that greenhouse gases such as carbon dioxide should be considered pollutants under the Clean Air Act. The Post says "it may be the first in a series of similar state actions." Or at least that's what environmental groups who are fighting proposals for new coal-fired plans across the country are hoping.

The rejected company, Sunflower Electric Power, wanted to built a 700-megawatt, coal-fired plant in Holcomb - the western Kansas town made famous in Truman Capote's "In Cold Blood" - that would have produced 11 million tons of carbon dioxide annually. That's almost as much as a group of eight Norhteastern states hope to save by 2020 through a mandatory cap-and-trade program.

The paper hints that Kansas' Democratic governor, Kathleen Sebelius, might harbor ambitions for federal office. The power company knew it was in was in trouble when Sibelius dropped this inconvenient truth in her state address this year: "The question of where we get our energy is ... no longer just an economic issue, nor solely an issue of national security. Quite simply, we have a moral obligation to be good stewards of the state."

Sunflower spokesman Steve Miller took offense. "That implies that we're not moral stewards of the land, which we don't appreciate one bit."

Google Gets In Trouble Trying To Shake Money Out Of Pandora's Box

Google made record profits yesterday. Again. But another story in the Wall Street Journal hints at the perils the future might hold for the search giant.

We of the Facebook and MySpace set may have never heard of it, but overseas Google runs a social networking site called Orkut that is huge. But lately in Brazil, the Internet powerhouse has gotten into hot water for its attempts to make money out of all that traffic.

When Google tried dropping ads into the site, critics in Brazil shot back with reports showing advertisements on Orkut alongside pictures of naken children and abused animals. Now the head of the company's Brazilian operation is facing criminal contempt charges for refusing to turn Orkut data over to police.

In the U.S., Google is beloved specifically because of its hardline stance on privacy issues. (Last year, the U.S. Justice Department took Google to court for refusing to hand over data about consumer Web searches that Yahoo Inc., Microsoft Corp. and Times warner Inc.'s AOL had supplied.) But the U.S. has fairly well-developed laws on Internet privacy and freedom of speech that other countries don’t have.

Brazilian law, for example, does not offer Internet companies the immunity for defamation-related claims that they enjoy here. In India, nationalists have called for an Orkut ban, and the site is already bloked in some Arab countries.

So when Thiago Tavares Nunes de Olivera, a 28-year-old Brazilian law professor, wrote a graphic alleging that Google allowed Orkut to become a den of criminal activity including child pornography and racist speech, the company was vulnerable.

Google says it regularly removes illegal content from its services. But the head of the company's Brazil operation admits that it didn't have enough people on that job soon enough. "The product grew faster than the support," he said. "That is a fact."

For advertisers, the episode underscored that social networking sites are an unreliable advertising vehicle. As the vice president of one Brazilian advertising company said, "Orkut is Pandora's box."

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[sanfelz]

What a sweet deal: the airlines get the government to assume the cost and responsibility of security while the airlines pollute the air with noise and fumes and make record profits.
I wonder how many generation of genetic damage will occur because of the chemicals spewed by airlines.

[bhappy2-2]

Thats why I don''t fly. I Love flying, I just hate to be treated like ***** and being charged more and more to be treated like *****. With all the SECURITY MEASURES you can''t complain or you wind up in jail for being a TERRORIST. NO THANKS! I''ll drive myself. If I can''t get there by driving I probably don''t need to be there anyway!

[DDouville]

I''m not affected by this as I am staying at sea level... I knew after 9/11 flying would be a mistake, and of course, I was right. It''s terrible the way passengers have been treated. The airlines should be ashamed. We are turning into a third world country, and the airline service is just one example. Just because a few terrorist got lucky. Shame.

[kansas1946]

The airlines are loving all of the terrorist ***, because they can use that as an excuse to treat people horribly. To keep people on the runway for 8, 10, 12, hours and then be able to arrest anyone who raises hell, is just to their liking. Guess what folks, they will just keep it up until passengers say enough. The congress has been trying to get a tough patients bill of rights passed, but of course, Republicans have tried to gut it, with Baby Bush''s blessing.

[gkc99]

Well the important people did OK, anyway. They can contribute big bucks to Bushit and the Repugs. What''s the problem?

[shanev137]

Keach Hagey is hot.

[oscarez]

"The airlines need some serious competetion! Let''''s have high speed railroad service all across the country."

Yes, the money Bush has spent in Iraq would have gone a long way to providing these services. The inside lanes of the Interstate highways could be turned into a high speed electric rail system. When the oil is gone what will the airlines use for fuel? You can bet Goodyear, Ford Motor, General Motors and all the service companies will fight this ideal tooth and nail.

[tcoleman12]

I feel the three broadcast news networks should be able to take a little something from this airline story.
Keep pumping out garbage, giving the "news" that fits their agenda and not worrying about ratings and record profits may eventually roll their way as well.
Or they will just melt away into obscurity and irrelevance.

[cdfoxtrot]

Shouldn''t they be asked to hand back all the taxpayer payouts they were gifted in the wake of 9/11? They can afford it.

[susanhelit]

We need to add some regulation, there are some real abuses - but the article doesn''t say what it''s trying to imply, and the reasons for this are quite simply what we, as customers, are willing to pay for and not willing to pay for.

There was a time when air travel was pleasant and reliable and just wonderful! And almost none of us could afford to fly, prices were outrageous. As prices get cut more, we can afford to fly more, but the experience is worse. That shouldn''t surprise anyone. You can''t get something for nothing.

[lastdance2]

Airlines Turn Bad Service Into Big Profits
The country''s air traffic control system was outdated

This has been going on since the Reagan-Bush Administration

In October 1980 - The Reagan-Bush Administration

Pres Reagan - Fired all the - Air Traffic Controllers - Around the Country
(Over 85% of the Air Traffic Controllers Fired - were Vietnam Veterans)

Bush (sr) - Sent appointed Republican Committees to Restructure Airport
Managements across the Nation

Airline Flight Delays - Flight Cancellations - Flight Rescheduling

Brought to you by :
The Republican (Nazi) Party - Criminal Corporate (Nazi) America.

Understand ! ! - - The Ideology of - The Political Party that - Created the Problem

Lastdance

[susanhelit]

We can have better airlines. All we have to do is, the next time you go to fly, pick the best airline, rather than the cheapest. You''ll pay $100 more for the ticket, but they''ll get the message we are willing to pay more for good service.


Hmmm - I''m not willing to do it either. Overbooking flights, cutting food, cutting number of baggage handlers, running everything on the bare edge, so if anything goes wrong, the whole system comes falling down - that''s the way to cut costs to the bone to compete.

If you read the article, you see that the writer is just having some fun with us - profits are up to the best SINCE 9/11 when all the airlines nearly went bankrupt. In other words, profits are nearly back to normal, after several years of running in the red or just barely making ends meet.

[mswolfestock]

Let''s round up all the airline company Big-Wigs and give them a dose of their own medicine. Over-book them, lose and damage their luggage, keep them sitting on the run-way for a day and then treat them like S*** when they have the audacity to complain. I know this will never happen, but obviously they are out of touch with their customers. Shoot, they just rent a private corporate jet when they have to go somewhere. It''s really sad . . . . My husband and I will be going to Mexico this coming January and I am dreading the ordeal of flying. Our previous vacations (Jamaica and Mexico) were great once we reached our destination but I think everybody''s vacation experience is greatly diminished by the hellish ordeals we all have to go through at the airports. The airline companies are taking the old cliche way too seriously: "You have to go through hell to get to heaven." A lot of us just won''t bother to go.

[eskieville1]

The airlines need some serious competetion! Let''s have high speed railroad service all across the country. Comfortable seating, club cars,and dining cars.No more stuck on the tarmac for long periods of time. This would also help us reduce fossil fuel consumption. It won''t be perfect but it may be better than what we have going now which is insane!

[missingamerica]

"Massachusetts, we would have expected.".

To the contrary, the Cape Code people just rejected a proposed wind farm.

[killtheliars]

Oscarez,

My opinion is that any time there is a problem that comes under scrutiny it is either blamed on the need to stay competitive (i.e. cutting cost by cutting services) or because we need to be cautions because of terrorism. Anymore any time a corporation screws the public these are the excuses we get.
You have to admit, big business and the administration have benifited as a result 9/11 more then anyone else. I am not one of those who believe they were involved, but I do believe they saw it as a situation they could take advantage of.

[oscarez]

Why is it that the American air traveling public are willing to take any amount of abuse. Its like "Hurt me, hurt me, oh hurt me please, I like it you beast". And the money just keeps rolling in.

[killtheliars]

the government needs to stop bailing out failed transportation companies. US Airways should no longer be in business. If they had not been bailed out they would have had to shut down by now.
If we would let them go under another company would move in, if they fail they go under and another company will come along. Eventually someone would get it right and the consumer would benifit, and that is all that matter. Employee jobs and stock prices should not matter, that is not a valid excuse for the government to step in and bail a company out with tax payer money. In a capitalist enviornment it is dog eat dog and all companies should have to play by the same rules.

[anibalhector]

Yo creia que unicamente en Argentina se perdian los equipajes y se maltrataban a los pasajeros, pero parece que tambien ocurre lo mismo en vuestro pais. ?Seran males de la globalizacion contagiosa? Cordialmente, Anmbal, desde Bahma Blanca, Argentina.

[kissamaarse]

Within the last few months I have flown on British Air, Aer Lingus, Air France, Virgin Atlantic, Lufthansa, SAS, and British Midland. The entire cabin was served an English breakfast on a very short flight from Southampton to Manchester one morning. On a U.S. carrier you would not even get a tiny bag of peanuts. European carriers'' service, and ticket prices, put U.S. airlines to shame. I would never by choice fly a U.S. airline if there is a European alternative. Expect U.S. airlines to get worse, more expensive, and with swelling profits. Shameful.