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Friday, 11 September, 2009

Good morning

This week will be the final week of our PBS style annual reader fundraiser - although I hasten to add that support is, of course, welcome at any time of year.

The last week has seen the number of supporters swell up to a heartening new total of 611 people.  Special thanks in particular to the latest 'super supporters' - Leah M, Suzanne C, Charles J, Dean V, Antoinette W, Ken A, Teri M at Travelrest, Steve W, and Richard H.

We need just nineteen more readers to help out, and we will then reach this year's target of 630 supporters. This is tremendously encouraging, and I'm now hoping for 20 or more extra supporters, so we can exceed our (modest) target, even in these tough times. Thank you to all 611 supporters so far, and to the 20+ extra who I hope will respond to this last call.

I'm not going to go on at length again about the vital need for your support - you've probably read this in the last few newsletters already.  Instead, here is an extraordinary letter from a reader that says things I can't say, and better than I could say.

As you hopefully also know, I never wish anyone to send me more than they conveniently can afford, and in this case, I ended up refusing to accept this person's contribution, because it did not feel fair and equitable.

Dear David

I am enclosing a check for $50, in response to your 2009 Fundraising Drive.  This is twice the amount I sent you last year, even though times are tough for me (unemployed for a year and four months, no end in sight).  I can see how much work you put into The Travel Insider, and I feel you deserve a contribution from every one of your readers for that reason.  Frankly, I am shocked that so few respond to your fundraising effort.

Even though I cannot afford to travel right now, I learn a lot from your writing.  I look forward to the day (and I know it is coming) when I join some of the tours you arrange.

So, I close this year's fundraising drive with a request - can you too now help us reach our target, and send in some part of the $50 that reader K so kindly offered but which I didn't feel able to accept?

I'll give you a final total of reader support next week, and will trouble you no more this year on this important topic.

Today is 9/11 - eight years after that 9/11.  And, almost to the day, we have a would-be hijacker who succeeds in smuggling not just a box cutter but a mock bomb, including three juice cans filled with sand, wires, electronics and a stop watch on board a plane flying from Cancun to Mexico City.  This was not something he hid in his shoes - it was much too big!  It was simply brought through security and onto the plane in a carry-on suitcase.  Details here.

Okay, sure, it was a domestic flight from Cancun to Mexico City, and as such not subject to US oversight or security regulations.  But you could still have been on that flight, and a bomb is a bomb, a hijack is a hijack.

My question, eight years after that fateful day in 2001 is simply this :  Are we safe?  Are we safer?  And so, for this week's article, I'm featuring a column I wrote five years ago, on the third anniversary of 9/11.  The article has not been updated in five years.  But there is almost zero need to update it - sadly, almost nothing has changed in five years, unless you feel that the need to now give our full names and dates of birth, or to have no more than 3 oz of liquid per container are positive steps that enhance our safety.

This Week's Feature Column :  Are We Safer?  Are We Safe?  :  Written three years after 9/11, but largely the same story four, five, six, seven and now eight years later.  The situation is much the same, as is the 'security' with the only notable development for most of us being being new restrictions introduced on liquids and having to match our full name and date of birth to our ID.

One of my frequent laments is that airport security remains an ineffective charade - whenever its effectiveness is tested, it seems that about 20% of weapons continue to be smuggled through X-ray machines undetected, the same as has been the case for many years past.

In other words, five terrorists go to the airport.  Maybe four will be caught, but the fifth will get through security undetected.  And, if they're clever (believe it or nor, terrorists can be clever) maybe two or three (or even all five) might get their weapons through 'security' with no problems at all.

What is to be done?  A hint comes from the news this week from Britain of the 'liquid bombers' being found guilty of attempting to blow up planes in the mid-Atlantic.  These people, who were the cause of the 3 oz liquid limits we now suffer, were not caught at airport security.  They were caught by good old fashioned police work and counter-terrorism intelligence, long before they headed to the airport.

The most surprising thing to me is that the 9/11 events have not been repeated in some form or another.  We still have gaping vulnerabilities - not just in aviation, but in every other part of our lives, and in every other place where people congregate.  A terrorist group could kill more people by bombing a single multiplex cinema while a popular movie is showing than the total number who died on 9/11/01 (266 passengers on the four planes, 2595 at the WTC site and 125 at the Pentagon - a total of 2986 people).

I'm not saying we should discontinue airport security.  But perhaps we need to recognize that airport security is only our last ditch, final, desperate, and imperfect attempt at impeding only one type of terrorist attack, and task some of the billions of dollars and tens of thousands of employees towards more counter-terrorism resources to detect and catch terrorists long before they get to the security line, or to the multiplex, or to anywhere else.

One last thing.  Is it only me who feels some sadness that we've yet to complete the memorial on the WTC site?  It isn't as though we're talking about a massively overwhelming piece of construction, either.

Dinosaur watching :  Do you remember, from time to time, whenever one of the major airlines 'threatens' us with bankruptcy and closing its operations entirely, all sorts of 'experts' pop up and proclaim that the loss of the airline and its services would be very harmful to the nation as a whole, for reasons that are always vague and unclear.

Now here's an interesting statistic to put such claims into perspective.  It is projected in this article that airline capacity at the end of this year will be 6.8% down from capacity at the same time last year.  That mightn't sound like much, but it equals the entire market share of US Airways.  Add to that the 10% or so reduction in passenger numbers in the year prior to then, and you're talking about not just one but perhaps two airline equivalents being taken out of the market.

So the airlines are voluntarily shrinking themselves by an entire major airline (or even two) capacity share equivalent, and there's little appreciable harm or even inconvenience being suffered by any of us.  Let's remember that the next time an airline threatens us with closure.  We can manage just fine without them.

The poor airlines - not only are they suffering from reduced passenger numbers, but they're also suffering from jet fuel costs that are starting to rise upwards once more, right?

Well, actually, wrong on both counts.

Firstly, I have never accepted that the capacity cuts are because of shrinking passenger numbers.  Let me ask you - is it your perception that flights are emptier these days than they used to be?  Absolutely not!  Capacity cuts are causing the reductions in passenger numbers, rather than vice versa, as is confirmed by the fact that capacity cuts are often preceding the reductions in passenger numbers (ie flight loadings are increasing).  My three part article series written in January about the shrinking airlines (and cited approvingly in no less an august journal than The Economist) is even more true today than it was eight months ago.

Secondly, jet fuel.  We all know that petrol prices bottomed out and have been inching upwards again, and I now find myself sometimes paying over $3 a gallon (for regular unleaded).  However, the price of jet fuel is only mildly linked to the price of automobile gasoline.  So - get this.  Jet fuel prices in July reached a five year low (see this article).  Jet fuel has never been cheaper at any time between July 2004 and now.

And, thirdly (a bonus point), let's not forget that the airlines today are leaner (and meaner!) than they ever have been.  Their staff are paid less and work harder.  They've saved themselves 10% in travel agent commissions.  They've saved themselves more in call center staff, and even in checkin counter staff, using websites and machines instead.  Airlines and their staffing today are vastly more efficient/productive than they formerly were.

So tell me again about the need for fuel surcharges, and baggage fees, and every other bit of financial pain and travel inconvenience the airlines are foisting on us?  Rather than 'sharing their pain' with us, shouldn't they be celebrating some of the most wonderful underlying business fundamentals they've ever had?

Oh - yes, that's right.  Our recession.  The collapse in business travel.  Well, at the risk of stating the obvious, the collapse in business travel isn't quite as the airlines define it.  Business people are still traveling.  But they've revolted and rebelled against the airlines and their ridiculously high fees for appallingly poor 'first class' service, and are now flying in the back of the plane on the cheapest fares they can find.

The airlines kept on 'saving money' by removing lettuce leaves off their first class salads until it got to the point that people started to realize 'hey, first class isn't worth it any more' and stopped paying the exorbitant price premiums the airlines seek.

As much as the airlines try and blame everyone and everything else; they are, and have been, responsible for their own destinies and their own failures.

Here's another transparently ridiculous reason for raising baggage fees.  Ryanair said that because its average fare has decreased some 20% this year, it needs to raise its baggage fees.  This is nonsense - no-one forced the airline to drop its fares; it is simply shifting how it collects money from its passengers.  As for their increases in baggage fees, they're not too bad for your first bag, but if you're traveling with two bags, the second bag will now cost three times what it formerly cost (new price, each way, of /70 if checked in at the airport, half that online).

And don't think you can outsmart the airline by simply squashing everything into one big bag.  They impose a 33lb per bag weight limit.  With an empty suitcase sometimes weighing half that, you try to pack a week or two of vacation clothing into a 16lb weight limit!

With Ryanair, two checked bags could now add 200 (almost US$300) to your ticket price.

The good news :  The Senate has now passed the Travel Promotion Act in a 79 - 19 vote.  The bill has already been passed by the Congress.  This will create a new Corporation for Travel Promotion as part of the Commerce Department, and will be tasked with promoting the US as a tourist destination to people in other countries.

The even better news :  There will be no cost to us as taxpayers for this new government department.  Huh?  Which, alas, leads to -

The bad news :  The cost of this new program will be recovered by charging visitors from 'visa waiver' countries (countries where visitors to the US don't need to get a full visa prior to traveling) a $10 per visit fee.  Which is sort of an extension of the concept long espoused by cities, counties, and states when they charge visitors to their region taxes on things like rental cars and hotel rooms.

Why is this bad news?  Because other countries, especially in the EU, are somewhat upset about this, and are threatening reciprocity - ie, they may start charging us $10 fees when we visit their countries, too.  Don't think these countries are bluffing.  They'd love to be able to charge visitors rather than taxpayers for their own longstanding tourist development organizations, and now that the US is about to become the first country to actually take the step of charging visitors for the cost of encouraging them to visit, expect to see a spiral of other countries start charging visitors more and more fees for more and more things.

I remember when the total taxes on an international air ticket were less than $10.  Today they can be anywhere from $100 to $200.  What's another $10 on top of so much already, you might ask?  But that's the logic that has seen less than $10 in total balloon out to sometimes more than $200 in the last 15 - 20 years.  We're being nickeled and dimed to death with taxes and fees on our tickets.

And where are the airlines in all of this?  Do they not realize this $100 - $200 is a disincentive to us to travel?  For that matter, do they not realize this $100 - $200 is money that, if it weren't going to the various governments and other taxing/fee-levying authorities, could be going to their pockets instead?  Maybe the blow out in fees for international travel is another part of the reason why airfares are so soft and passenger numbers so low?

So how should this new department be funded?  Simple.  The people who benefit should be the people who fund it.  And we are the people who benefit.  Studies consistently show that every dollar spent on tourism promotion brings back many dollars in extra benefits to the region that is promoting itself.  Indeed, as amazing as it may seem, studies suggest that not only does the promotional investment benefit the region, but the rise in taxes (sales taxes, income taxes, all taxes) as a direct result of the increased tourism activity is also greater than the amount spent on tourism promotion.

So, it sort of truly could be free.

Talking about fees, last week I'd mentioned KLM adding a surcharge for ticket purchases charged to a credit card and had wondered how else the airline expected people to buy tickets.  Two follow ups to that :

First, debit cards are more widely used in other countries to pay for such things, as are other forms of electronic payment such as direct transfers out of a person's bank account.  The US tends to lag behind much of the rest of the world when it comes to banking services.

Second, it is not only KLM that is doing this.  In the UK alone, I'm aware of the following charges - British Airways credit card fee is 4.50; no fee for debit cards (charges are per passenger, per booking).  Brittany Ferries charges 5 per booking for a credit card fee, none for debit cards.  BMIbaby charges a credit card fee 3.75; debit card fee 2.75 (per person, per one-way fare).  easyJet charges a credit card fee  of 2.95% of the total transaction with a minimum charge of 4 or a debit card fee of 2.95.  Eurostar charges a credit card fee of 3 per booking, none for a debit card.  P&O Ferries charges a credit card fee per booking of 2; no fee for debit cards.  Flybe charges a credit card fee of 3.50; debit card fee 1.50 (minimum 2 per booking, and charges are per person, per one-way flight).  Ryanair's fee is 5 for a credit card, debit card fee 5, per passenger, per one-way fare.

Is this an unstoppable wave of the future that will arrive in the US too?  Almost certainly.

Here's an article that suggests airlines are worried by unhappy passengers now complaining on Twitter.  I disagree.  If airlines truly cared what their passengers/customers thought, wouldn't they simply take some steps to providing consistent decent service?

Longer term readers know that I'm what could politely be termed a global warming skeptic.  Some readers sometimes castigate me for airing these doubts in the newsletter, and for highlighting, for want of a better term, the inconvenient truths that rather negate the main thrusts of the global warming advocates, and say that a discussion about global warming has no place in a newsletter with a primary focus on travel and travel related technology.

I wish that were true.  I wish we could all allow the global warmers to do whatever they wished, and not to have to fear the consequences of their actions and how such actions might intrude on our lives as travelers (and technologists - I've seen studies pointing out that computers cause more carbon emissions that airplanes).

But the sad reality is that, even though air travel represents as a teensy tiny source of the much vaunted 'carbon emissions' (about 3% of the global total) it has been seized upon by the global warmers as a vulnerable and evil villains, and one to be mercilessly restricted and controlled.  This week's example is a recommendation by advisers on climate change to the UK government that air travel be rationed in the future.  Needless to say, the rationing mechanism is being suggested to be the imposition of massive fees to be added to each airline ticket so as to restrict our ability to afford air travel.

The tens of billions of pounds in fees that would be added to tickets in Britain alone are being suggested to be spent helping developing nations build flood defenses in response to climate change.  Why not, ahem, spend some of the money to encourage the developing nations (most notably China and India) to reduce their burgeoning carbon emissions - emissions that are rising at rates that make the emissions from ever-more-efficient planes a trivial non-event on the global carbon emission stage.

This issue is actually unrelated to global warming.  Whether you support the view that carbon emissions cause global warming or not, my point here is simple.  If we want to reduce the world's carbon emissions, there are a dozen much more cost effective and appropriate ways to tackle the problem.  Airplane related emissions are a trivial part of the issue that are being unfairly picked on.

In addition to the suggestion that developing nations improve the ecological standards of their industry, here's another suggestion about controlling carbon emissions.  Carbon emissions track population growth - twice as many people cause twice as much carbon to be emitted.  As reported in this article, the London School of Economics has just released a study that shows money spent on contraception is five times more effective a way of reducing carbon emissions than any of the conventional green technologies.

What could be simpler than that?

A week is a long time in politics, or so they say.  And, occasionally, in an industry that these days more commonly moves at a glacial pace, it can be a long time in the aviation industry too.  Last week Boeing and its fans started gloating when the first 1,000 page part of a World Trade Organization ruling appeared to find for Boeing (another report and interpretation here) and against Airbus, supporting the claim that some loans to Airbus by EU member states were illegal subsidies rather than bona fide commercial loans.

But rather than being the conclusion to a dispute that dates back to 2004, this is - in Churchillian terms - not the beginning of the end but rather, the end of the beginning.  The WTO still has to rule on Airbus' counter claims that Boeing also received subsidies from the US government (in the form of NASA research projects and defense contracts), and even when the rulings are both in, there is the possibility of appeals.  Some observers predict that the case may not be settled until 2012 at the earliest, and even when the WTO ruling is finalized and absolute, it may have no real world impact on either company.

Boeing's brief flash of gloating and good news quickly faded, however, and then both Airbus and Boeing had to face bad news from a new source (and one which might also be susceptible to WTO claims as well!).  China's new passenger jet, the 168 seater C919, and built by the Chinese government-controlled Commercial Aircraft Corp of China, enjoyed another bit of public exposure with this news item, and just because it is not something we as lay passengers are familiar with, don't think for a minute that airlines aren't very aware of its development.

The C919 is - or should be - a terrifying threat to both Airbus and Boeing.  I've commented before that the current duopoly enjoyed by the two western airplane manufacturers seems to have an unwritten agreement between them - 'you won't replace your A320/737 family with newer planes and we won't either', causing these two families of closely competing planes to continue with a surprisingly long model life and massive profitability to both companies.  Although their technology has been somewhat updated, the planes are based on old and no longer 'best practice' aircraft design and construction (most notably, with the 737, a fuselage design dating back to the mid 1950s).

The 737 first flew in 1967, and so the original 737 is now 42 years old, with no announced plans for the 737 series be replaced.  Compare that to the 727, which first flew in 1963, and which ended production in 1984 (a production life half the 737s), or the more modern 757 (first flew in 1983 and discontinued in 2004 - again, a 21 year production life).

But, back to the C919.  It is due to first fly in 2014 and to be placed into commercial service in 2016; timings which mean that unless Airbus/Boeing immediately start work on a competing product, the C919 will enjoy a massive advantage over the older 737/A320 families.  How massive?  The purchase price of the C919 is not yet known, but it is unsurprisingly expected to be appreciably below the western planes.  And - as important as the purchase price - the C919 promises to be very fuel efficient, claiming to use as much as 15% less fuel than its western competitors.

There's a lot more to choosing an airplane than 'just' its purchase price and fuel economy, of course.  But you can be sure that customers in the world's largest airplane market - China/Asia - will be more than willing to positively consider the C919 when choosing their future airplane purchases.

Why is it I get the feeling that Boeing and Airbus are fixated on each other and are not giving sufficient attention to new competitors such as the Commercial Aircraft Corp of China and the new C919?

Something else that may be off the radar screen is the Mitsubishi MRJ regional jet, because it is 'too small' to be a threat to the Airbus and Boeing range of planes.  The MRJ will hold up to 96 passengers, but could well be the precursor to subsequent and larger models of airplane.  Need I remind readers of how the Japanese auto industry started off as a niche player making low grade small cars, and now dominates every sector of the market, including sectors that the 'experts' said the Japanese could never conquer such as luxury and sports models.

Interestingly, this week saw an announcement from Mitsubishi about its development of the MRJ.  The company has decided to switch from predominantly carbon fiber construction and will instead use traditional aluminium.  Oh - and showing that some things seem to be universal, it also disclosed about two years in delays to the program.  Look for the first plane to fly in Q2 of 2012 and the first plane to be delivered and commercially operational in 2014.

Amtrak, eat your heart out (continued) :  Here's a thrilling video of an experimental new train in Europe that reached a maximum speed of 574.8km/hr on a recent trial.  That's 357 mph.  Stunningly fast.  New York to Chicago in little more than two hours.  Boston to Washington, or Los Angeles to San Francisco, in little more than an hour.  And so on.  Oh well, one can dream, can't one.

Here's an interesting article on cell phone radiation.  Did you know that some cell phones emit four times as much radiation as others?

The article is incorrect on one thing, though.  It is possible to get radiation data for just about every cell phone, as is explained on the FCC website here.

Apple announced its new lineup of iPod devices on Wednesday.  I got one of the lovely new iPod Nanos on Thursday afternoon - too late to include a full review this week, but I'll be writing on the full model range and the specifics of the fun new Nano next week.

One of the new features is a built in video camera, and if you can't wait for my full review, you can see a silly short 20 second video clip I took immediately after getting the Nano as a demonstration of the quality of its video camera, and now on YouTube.

According to Steve Jobs himself, this is the prime purpose of the built in video camera - a way to capture casual, low quality (my words not his!) video for simple posting on YouTube, and he sees the Nano as an alternative to some of the other tiny and very basic digital video cameras that have been appearing for sale at relatively low prices.

More next week on the Nano and other new iPods.

This Week's Security Horror Story :  We were promised last year by the then TSA chief that the liquid ban/limit we all suffer at present would be removed by this fall.  Since then, liquid analyzer machines have been developed that are so sensitive that they can tell the difference between Pepsi and Coke, while still in the bottle.

But we're now being told that the liquid ban will not be removed or changed this fall, or indeed, any other time soon.

Instead, we're now getting hints that the restrictions on liquids might be extended to powders as well.  In an innocuous seeming announcement, the TSA said 'Passengers should know that while common powders are not prohibited, a small percentage may require additional screening. Typical security checkpoint procedures will remain the same. The vast majority of commonly carried powders, like most medication, infant formula and makeup, are unlikely to need further screening.'

Apparently the TSA has only now discovered that explosives can come in powder as well as liquid form.  Heck, I was making wonderful explosions with powders from my high school chemistry set decades ago.

Here's an article that makes several interesting points about airport security.  It contrasts the difference between the 213,000 passengers referred to 'secondary screening' by TSA 'behavioral specialists' with the apparently zero number of terrorists actually caught as a result of these 213,000 secondary screenings.

Kinda makes one wonder about the value of these secondary screenings, and the 2,400 TSA 'behavioral specialists' now roaming around our airports.

It also points out that these behavioral specialists can be a bit trigger happy - having one time questioned the article's author about what he was doing after noticing he was simply writing in a notebook.

Over-reaction?  In the UK, Boy Scouts are no longer allowed to take pocket knives with them when they go camping, writes the Daily Telegraph.  The ban extends on to parents who accompany their sons, too.  So much for the Boy Scout code which says 'The Scout is to be trusted' and the concept of always being prepared.

Britain, having banned most types of firearms such that only criminals and police now have them, is now fixating on knives as the next evil weapon to be restricted and controlled.

Here's a must-read article that will frustrate and anger you about how sellers of electronic items are not taking the reasonable and fair steps they should to help us when we have them stolen from us.

And, lastly, here's a must-visit webpage if you haven't already helped out in this year's fundraising drive. :)  Please do choose to become an active Travel Insider supporter.

You never know - the person who benefits from your support could well be you - either in the form, at present, of the article you'll receive in return about how to get thousands of free frequent flier miles (for US residents only), or in who knows what new 'how to' guide or review or something else that will be of value to you over the course of the next year.

Until next week please enjoy safe travels

David M Rowell aka The Travel Insider

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