A front-page news article, an editorial, and a business-section column in today's Times all essentially echo the Justice Department line that the proposed merger between American and USAirways must be blocked on antitrust grounds to protect consumers.
This is an unfortunate example of the Times giving just one side of a story. Here are some other sides to the story that are not included in the Times coverage:
Airlines don't just compete against each other. Particularly on shorter routes, they compete against other forms of transportation, including buses, driving, and trains, in a broader market for inter-city transportation. So if the airlines are doing what the Times accuses them of, raising prices because of their monopoly or oligopoly power, people have the option of driving or taking a train or a bus.
Passengers have a choice of airports. The Times editorial says, "At Reagan National, for instance, the combined airline would control 69 percent of all takeoff and landing slots." But passengers in the Washington, D.C., metropolitan area don't have to use Reagan; they can fly from Dulles or from Thurgood Marshall/Baltimore Washington International Airport. The editorial says, "The two airlines have more than 1,000 overlapping domestic routes and together control a large majority of the traffic at important airports like Dallas-Fort Worth International and Ronald Reagan National near Washington." Dallas-Fort Worth is the same story as Reagan; passengers can use Love Field and avoid DFW.
New entrants and new models bolster competition. The Times had a fascinating feature the other day on Surf Air, a startup that offers unlimited service between Burbank and San Carlos, Calif., for $1,650 a month and a $500 membership fee. That kind of innovative pricing is not mentioned in the Times merger coverage, which assumes a pretty much static business model for airlines.
Restrictions on foreign investment retard competition. No mention in the Times coverage of the archaic rules that limit foreign ownership and investment in U.S. carriers.