Voice For Liberty

Tag: Wichita city council

  • Wichita City Council Meeting, April 19, 2005

    Some quotes and my remarks from the April 19, 2005 meeting of the Wichita City Council, where the AirTran subsidy was considered. Representatives from Delta attended and spoke.

    Allen Bell, Economic Development Director for the City of Wichita:

    Previous contracts had a dollar amount cap on them. The new contact, we refer to it as a no-cap contract. There is not, in the terms of the agreement, a specific dollar amount that is the not-to-exceed amount. In place of that there is a termination clause that allows the City to terminate its contract with 75 days notice for whatever reason. And the reason, of course, the major reason, would be that we know that within that 75 days, we will deplete the funds that the City believes is appropriate to spend on this.

    I was startled to hear this information, that the new contract has no dollar cap, as this has not been, in my memory, reported. It has been reported that AirTran sought a no-cap contract, but that Wichita would not agree to that. But it turns out that the city has agreed to what, in effect, is a no-cap contract. Yes, I believe Mr. Bell when he says that Wichita can cancel the contract, with notice, if the city believes it will spend more than the $2.5 million it has committed to. I would submit, however, that if the City spends the $2.5 million and realizes it needs to spend more to keep AirTran in town, the City Council would vote to do so. Therefore, the no-cap contract is in effect.

    Councilmember Schlapp extracted an admission from the Delta representative that Delta is not profitable on the Wichita route now, but they believe they will be soon. Ms. Schlapp concluded that there is no need, then, for a subsidy to Delta.

    Mayor Mayans said we have been discriminated against, rate-wise.

    Mayor Mayans: “Many of us, actually, are opposed philosophically to government interventions, because we feel that sometimes tilts the playing field.” The Mayor says one thing, but acts in a different way. What good is it to have a philosophical belief if it doesn’t guide your actions?

    Mayor Mayans and the Delta representative disagreed on who made telephone calls to whom and at what time. (Mayor Mayans: “So you didn’t call me back!” “Communications is a two way street!” Delta: “My recollection of it differs slightly from yours.” “I don’t recall it was my responsibility to get back to you.”) It is disheartening to realize that major public policy decisions may be made based on incomplete information, because someone didn’t get a telephone message.

    Councilmember Martz:

    “I guess to me, when I look at competition, if you’re losing money, then you ought to raise your rates enough so that you’re not losing money.”

    “I’m a firm believer in competition.”

    “I would prefer not having any financial help from the city, but rather through pure competition, all carriers reduce their rates to a level that they number one, can make a profit, at the same time make it economical for the citizens of the whole state of Kansas to be able to fly in and out of Wichita …”

    Like the mayor, Mr. Martz says one thing but acts in a different manner. His advice to airlines on how to set their fares is misplaced. We have to assume that businesses act in their best interests, and let it go at that.

    Sam Williams, Chairman of Fair Fares, who evidently is so well-known to Council members that he doesn’t introduce himself when he started to speak:

    “You know, Kansas in 1861 became a very important state in the history of this country, just before we went into the great dark area of the civil war. You know, we were a key state. What we did at that time had a lot to do with what happened and where we went from there. I would submit that little old Wichita, Kansas is doing that to the airline industry right now. Because of your vision, you are looking at different ways to bring fair pricing in an industry that is kind of broken, in getting them to look at themselves, us to look at ourselves, and how can we partner together to do this. Kansas again is a key, integral part of a change in this country.”

    First, to equate our state’s role in the civil war with subsidizing an airline is ludicrous. Second, I feel very sad that Kansas may become the leader in subsidies, and that business leaders applaud this. Mr. Williams, I would ask you if you would welcome a governmental body deciding whether the rates that your business charges are fair, and if not fair, subsidizing your competitor?

  • Poetry: Welcome New Council Members

    Contributed by Kenneth Kindler

    WELCOME NEW COUNCIL MEMBERS

    I AM OLD AND SICK AND GETTING GRAY
    I DON’T KNOW WHERE I WILL GET THE MONEY THAT THE CITY WANTS ME TO PAY.

    I WONDER ABOUT THIS TOWN THAT WE LIVE IN.
    WHERE THE MAYOR SPENDS HIS TIME DOWN IN OLD TOWN FIGHTING SIN.

    WE SUBSUDIZE A AIRLINE THAT MANY OF US CANNOT AFFORD TO FLY.
    WE HAVE SPENT MILLIONS DOWNTOWN, I WONDER WHY.

    HOW MANY OF US CAN AFFORD TO PAY
    FOR PLACES THAT ONLY A FEW CAN PLAY.

    DO WE NEED A DOWNTOWN ARENA?
    A WATER WALK.
    NOW WE ARE GOING TO SELL CENTURY II OR IS THAT JUST TALK.

    OUR LEADERS HAVE HAD MANY MONEY LOSING SCEMES IN THE PAST.
    EXPLORATION PLACE AND THE ICE RINK WERE A COUPLE
    BUT THEY WERN’T THE LAST.

    WHEN WILL IT STOP THIS INSANE PLAN
    TO EMPTY OUR POCKETS AS FAST AS THEY CAN.

    WE HAVE BEEN BULLYED, LIED TO AND RAN INTO THE GROUND.
    NOW IS THE TIME FOR US TO REBOUND.

    SO COUNCIL MEMBERS WE WANT YOU TO KNOW
    IF THIS KEEPS UP YOU ARE GOING TO GO.

    SO NEW MEMBERS WE HOPE THAT YOU WILL TAKE HEED
    AND PUT YOUR COMMUNITY AHEAD OF YOUR GREED.

    Kenneth Kindler

  • Open letter to Wichita City Council regarding AirTran subsidy

    January 24, 2005

    Dear Councilmember:

    I am writing to express my concern about the upcoming renewal of the subsidy being paid to AirTran Airways. You may recall that I appeared before the Council last May and spoke in opposition to the subsidy. Since then I have learned more about the Fair Fares program.

    As an example, Mr. Troy Carlson, then Chairman of Fair Fares, wrote a letter that was published on September 16, 2004 in the Wichita Eagle. In that letter he claimed $2.4 billion economic benefit from the Fair Fares program ($4.8 billion for the entire state). I was curious about how these figures were derived. I learned that the basis for them is a study by the Center for Economic Development and Business Research at Wichita State University that estimates the economic impact of the airport at $1.6 billion annually. In this study, the salaries of the employees of Cessna and Bombardier, because these companies use the airport’s facilities, are counted as economic impact dollars that the airport is responsible for generating.

    To me, this accounting doesn’t make sense on several levels. For one thing, if we count the economic impact of the income of these employees as belonging to the airport, what then do we say about the economic impact of Cessna and Bombardier? We would have to count it as very little, because the impact of their employees’ earnings has been assigned to the airport.

    Or it may be that someday Cessna or Bombardier will ask the City of Wichita for some type of economic subsidy, and they will use these same economic impact dollars in their justification. But these dollars will have already been used, as they were attributed to the airport.

    My primary opposition to the AirTran subsidy is based on the superiority of free markets to government subsidies. But I believe that if the Council should consider a subsidy, it should have sensible information at its disposal. The arguments the Fair Fares supporters make seem to be based on an overextended assessment of the airport’s economic impact.

    I have written more about this in on my website “Voice for Liberty in Wichita” at wichitaliberty.org.

    Sincerely,

    Bob Weeks

  • Remarks to City Council, May 11, 2004, Regarding AirTran Airways Subsidy

    I delivered these remarks to the Wichita City Council as they were preparing to vote on extending AirTran Airway’s subsidy for another two years. The extension passed with only one dissenting vote.

    Mr. Mayor, Members of the Council:

    I speak today in opposition to the continuation of the subsidy the City is paying to AirTran Airways.

    There are several reasons why I believe this subsidy should not be continued. The primary reason is that the subsidy, since it is paid to one company and one company only, is not fair to the other companies. Yes, it is true that fares are lower. But is that a legitimate reason to enrich one company at the expense of others?

    If creating an environment of unfair competition is good and correct, why should we not do this in other markets?

    If we feel that gasoline prices are too high, why not select a chain of gasoline stations and pay it a subsidy so that it could lower its prices?

    If we feel that a chain of grocery stores has too much market power and their prices are too high, why not create and subsidize stores to compete with them?

    If we feel that the commissions that real estate companies charge are too high, why not pay one of Wichita’s major firms a subsidy so that they could reduce their commissions?

    Let us all hope, then, that we do not find ourselves running, or being an employee of, a business whose prices the City believes are too high.

    But the situation is even worse. Through the Fair Fares program, the City has organized the potential customers of the subsidized business to ensure that they purchase from it. For the companies that pledged to Fair Fares: How would they feel if the government started a public body for the purpose of organizing their customers, and then used its powers of persuasion to compel them to buy from a competitor at the same time the City is subsidizing the competitor?

    All of this is in direct opposition to the American principles of limited government, individual liberty, and fair markets.

    The distortion of the market that the subsidy creates has another aspect: By creating an environment of unfair competition, we make it unlikely that any airline will consider starting service to Wichita unless they too receive a subsidy.

    If the Council feels that we must subsidize an airline, consider this alternative: why not subsidize one of the other established airlines, one that that flies to many destinations? Or, why not rotate the subsidy every year to a different airline? After all, if fares can be lowered if any airline reduces their fares, it shouldn’t matter which airline does it.