What Lee Moak Learned in Washington

WASHINGTON ( TheStreet) -- The first thing to say about Lee Moak's assignment to Washington, where he is president of the Air Line Pilots Association, is that he maintains his currency as a Delta ( DAL) 767 captain. He even plans to fly a trip over the Christmas holiday.

After six years as chairman of the Delta ALPA chapter, Moak was elected national president and took office in January 2011. "Being ALPA president is a great job," he said. "You have the ability to affect government policy that directly impacts the day-to-day lives of airline pilots in the U.S., and that is rewarding.

"But it's quite difficult here," Moak said, in an interview. "If you compare Washington with Wall Street, on Wall Street everybody is interested in getting a deal done as soon as possible and moving forward. In Washington, some people want to get a deal done, but there is a cottage industry devoted to slowing things down and making sure you get nothing done. If you're trying to get something done quickly, Washington is going to frustrate you."

One key complicating factor for ALPA, as it seeks to represent pilot interests, is the number of agencies -- at least eight of them -- that oversee aspects of aviation. The agencies include the Department of Homeland Security and its Transportation Security Administration, the Department of Justice, the Department of Labor, the Department of State, and the Department of Transportation, including the Federal Aviation Administration, as well as Congress and the president's office. Unfortunately, despite all of the oversight, "there is a fundamental lack of aviation policy and there is a lack of cross-departmental policy through Washington," Moak said.

Fortunately, Moak arrived in Washington with coalition-building skills he had nurtured at Delta. He has put them to use working with Airlines for America, the airline industry trade group; the Regional Airline Association; the Transportation Trades Department of the AFL-CIO and various airline unions; and the Chamber of Commerce.

"We have a pilot-partisan agenda, and we are willing to build a coalition with anyone who will work with us on our issues," Moak said. "We do our best work when we bring our own executive team, government, industry and labor together -- that is how you get things done in Washington."

Delta CEO Richard Anderson said Moak realizes that "the real challenges for the U.S. airline industry are outside the borders of this country, where you have airlines that are government-owned or depend on governments for backstop financing and run a world-domination tour.

"We have two models: the Delta model, which doesn't get government aid, and airlines that don't care about profitability because they are economic development arms of sovereign governments," Anderson said, in an interview.

A major problem, the two leaders agreed, is that while the U.S. lacks a comprehensive airline policy, governments in other countries are intensely focused on financing and promoting the interests of their national airlines. For instance, several Middle East airlines rely heavily on government backing and the Japanese government bailed out bankrupt Japan Airlines.

Among ALPA's recent legislative efforts:

After the DOT adopted regulations imposing heavy fines on airlines whose aircraft sit on the tarmac for more than three hours, Congress considered including those regulations in the FAA reauthorization bill in 2012. But ALPA worked successfully to keep them out, because inclusion would have limited any ability for future modifications. Moak made the point that airlines are not typically responsible for tarmac delays -- an airport may lack facilities or infrastructure to allow unexpected passengers to disembark, or federal inspectors may not be available to process international travelers. Moreover, the regulations "have the tendency to usurp captain's authority and to have a negative impact on the airline industry," Moak said.

When the DHS announced last year that it would establish Customs and Border Patrol "pre-clearance" in the Abu Dhabi airport for passengers flying to the U.S., "We led the charge against that," Moak said. "No U.S. carrier even flies to Abu Dhabi -- it was there strictly to give a competitive advantage to a foreign airline." DHS has promoted the concept that it could establish customs pre-clearance stations in airports around the world. Language enabling the practice is part of a pending DHS appropriation bill, which is opposed by ALPA as well as the AFL-CIO, A4A, the Airports Council International and the Chamber of Commerce.

The creation of such a broad coalition "is a great example of how (Moak) has bridged that gap," said Michael Robbins, ALPA director of government affairs. "They have all signed the same letter."

ALPA opposed the long-standing practice by which the U.S. Export/Import Bank enables foreign airlines to secure lower cost aircraft financing than U.S. airlines. Boeing ( BA), the primary beneficiary, is so powerful in Washington that only ALPA and Delta were willing to speak out. Still, the 2012 Ex/Im Bank reauthorization bill requires, for the first time, public disclosure of financing for foreign airlines' aircraft purchases, giving parties a chance to object. The bill also requires the U.S. Treasury to negotiate with European export credit agencies to end similar discounts by Airbus, so that Boeing would not be disadvantaged if the practice were to end.

Soon after the Ex/Im Bank battle ended, and this demonstrates the ways of Washington, ALPA worked closely with Boeing and others to oppose a requirement for U.S. airlines to contribute to a European carbon-trading effort that would have increased trans-Atlantic airfares by $3.1 billion over the next decade. The money would have gone to the European Union general fund, not necessarily to fighting climate change. Last month, President Obama signed a law prohibiting implementation of the requirement.

-- Written by Ted Reed in Charlotte, N.C.

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