Why is Transporting Such a Cluster?

With all the technology available, transporting people or things from one place to another should not be a complicated task, and yet the government always manages to find a way.

March 18, 2019

By: Bobby Casey, Managing Director GWP

transport airline mail

Getting from point A to point B, whether it’s a person or a thing, is such a cluster.  And it really shouldn’t be, considering the technology available to make it all happen.

Email and digital document authorizations, for example, has done away with the need for people to send hard copies of physical paperwork.  Online conferencing has saved people the trouble of having to drive or fly in for basic status meetings. 

Obviously, the need to transport yourself or physical things isn’t going anywhere, though.  I know I still like to travel!  And I know that still need physical things to be delivered either to me, or within close proximity of me.

So why is physical transport of people and things still such a cluster?

Short answer: the government.

Air Travel

A while back I wrote about the US domestic airline cartel, and how they could stand to have some more competition.  At the very least from existing foreign carriers.  That could improve service and help drive prices down!  It’s not happening any time in the near future, but this is just one of the examples of how the government complicates air travel.

Prior to this, I mentioned another service that unfortunately never got off the ground (pun intended): FlyteNow.  The basic structure was similar to Uber in that if you wanted to take a commuter flight somewhere, you could look for flights leaving the area around the time you were looking to go and basically pay to hitch a ride.  It’s not a scheduled regular flight the way the major carriers have.  That pilot was already on his way to your destination for other business, so you can hitch a ride at an affordable rate.

The FAA was not going to have it, and of course the lobby was very strongly against them. Even the SCOTUS turned them down to hear their case. 

Blackbird is trying its hand at potentially navigating around the hurdles that faced FlyteNow in the past.  Whereas FlyteNow was more like hitching a ride with someone already heading that way, Blackbird is an organized charger. 

The problem with the former is that pilots were not allowed to profit from anything other than the gigs they are chartered for.  So, if a pilot was on his way from Concord, NH to pick someone up from Cape Cod, MA and bring them back to Concord, NH, he can charge for the charter of bringing the person back from Cape Cod, but not for the rideshares from Concord to pick up that client.

With Blackbird, the idea is that all flights would in fact be chartered. 

Who knows if this is a sufficient work-around for these regulations, but thus far, it’s received about $10 million in investments because people are chomping at the bit for a service like this.  I don’t think they will have any difficulty filling the seats, but there might be a harder time finding the pilots and planes.  More people have cars and driver licenses to participate in ridesharing than they have piloting licenses and a plane!  Either way, I really hope these guys can overcome the obstacles, because Uber Charter would be awesome!

Mail Delivery

What about just getting a letter from one place to another?  As I’ve discussed before, the USPS runs on government fairy dust.

I’ve talked quite a bit about the insolvency of the USPS: year over year losses, even when revenues are up from the previous year; approximately $100 billion in unfunded liabilities; $13 billion in debt; defaulting on their health insurance benefits since 2012… They are broke as a joke! 

But wait!  There’s more!

Public opinion about the USPS is slipping.  Their punctuality and customer service are slipping, but what’s more is reports of theft are starting to pile up.

All of that you could say is not really shocking.  I’m with you.

Here’s where things get a little less easy to accept.  The USPS falls under the protections of the FTCA, or Federal Tort Claims Act of 1946.  The SAME protection enjoyed by the TSA when they go too far with their “inspections”: 

The FTCA generally affords the government sovereign immunity when employees commit intentional torts, a type of civil wrong.”

What does this mean for the USPS?  It means there’s no legal recourse for items not delivers and they cannot be sued for “[a]ny claim arising out of the loss, miscarriage, or negligent transmission of letters or postal matter.”  So good luck proving your stuff was stolen rather than lost.

That’s not the worst of it… the USPS isn’t bound by any patents either.  Whatever your position is on intellectual property, it is currently very much a part of our market landscape.  And if the private sector has to follow those rules, then certainly the government should as well!

Nope.  As FEE points out:

“[I]f USPS starts using a valuable piece of scanning technology dreamt up and patented by somebody else, the patent holder can at best get some compensation from USPS if the court rules in their favor. But after paying damages, USPS can simply carry on using it as before…”

There is currently a case before the SCOTUS, as to whether the USPS can seek invalidate a patent directly with the Patent and Trademark Office via “ex parte reexamination”.  This is something a private party can do, but the government isn’t a person by legal definition.  Right now, due process is being preserved by a semantic technicality!

It has the protections of the law against competition.  It has the protection of the state against any consequences for improper handling of goods.  It is above patent laws.  It gets $3.6 billion in assorted government subsidies including tax exemptions and low interest treasury loans (the likes of which are NOT available to private carriers).  And it still can’t turn a buck!

Whether we are trying to transport ourselves or things, the government has found a way to make what should be a simple task given the immense technology available into the most mind-numbing experience ever.

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