NORMAN — Tom Horton and Doug Parker, the normally tight-lipped top executives of American Airlines and US Airways, recently floated the idea that they would be open to mediation or an out-of-court agreement to resolve the federal lawsuit against their proposed airline merger.
We’re listening, and we hope the Justice Department is listening, too.
The suggestion, made during a meeting with the editorial board last week, is on the right path to avert a high-risk showdown at trial next month. Courtrooms are risky places; even a win can be a loss. Mediation would give the Justice Department and the airlines a reasonable opportunity to find points of agreement that they would not find during a heated court battle.
We’re not the only ones worried about where this is heading. Mayors in Dallas, Fort Worth, Phoenix, Charlotte, Miami-Dade County, Philadelphia and Chicago co-authored a letter dated Wednesday that cites benefits of the merger for their communities and urges the federal government to let the plan go forward.
A negotiated agreement is the best resolution for the airlines, consumers and the thousands of North Texans whose jobs are linked to a prosperous American Airlines. Not to mention that the merger would be a win for free-market principles.
Just a few months ago, American was in bankruptcy and roiled in ugly fights with its labor unions. Although US Airways didn’t have similar internal drama, it needed a partner to remain relevant in an increasingly competitive industry. American’s emergence from bankruptcy and planned merger with US Airways would solve each airline’s problems. Instead, the Justice Department stepped in.
The department contends that the proposed merger is bad for consumers because it would result in fewer route choices and higher fares. What the government seems to have forgotten is that the airline industry is globally competitive — and airlines have to exist before they can compete. Airline history is littered with once-popular carriers that became too small or too weak to survive.
The fact remains that the Justice Department’s attempted block is inconsistent with previous rulings. In recent years, the department approved mergers of Southwest and AirTran, United and Continental, and Delta and Northwest.
Isn’t there a middle ground that would serve the interest of consumers and allow US Airways and American to merge? And isn’t the place to find that solution at the negotiating table? Creative options are available – for instance, the airlines giving up some landing slots at Reagan National Airport in Washington or making legally binding agreements to maintain certain service levels.
From the day it filed the lawsuit, the Justice Department has maintained that the market leverage of a combined US Airways and American can only be resolved by keeping the airlines apart. It is better for all that this impasse is talked out, not fought out.
— The Dallas Morning News