In the economic sphere an act, a habit, an institution, a law produces not only one effect, but a series of effects. Of these effects, the first alone is immediate; it appears simultaneously with its cause; it is seen. The other effects emerge only subsequently; they are not seen; we are fortunate if we foresee them.
— Frederic Bastiat
A program designed to bring low air fares to Wichita appears to meet that goal, but the unintended and inevitable consequences of the program are not being recognized. In particular, the number of flights available at the Wichita airport continues to decline.
Of particular note is that over the past two or three years, the trend of flights nationally is level, while the trend of flights available in Wichita is declining. The gap between Wichita and the nation is increasing.
According to Regional Economic Area Partnership, the goal of the Kansas Affordable Airfares Program (KAAP) is “to provide more air flight options, more competition for air travel, and affordable airfares for Kansas.”
Is the Affordable Airfares program meeting its goals? If we look at “air flight options,” and if we consider the number of monthly departing flights as a measurement, Wichita isn’t doing well compared to the nation. The chart at the end of this article illustrates.
In its Kansas Affordable Airfares Program Fiscal Year 2011 Report, REAP addresses the goal of “more air flight options” and reports:
“Air service through Wichita Mid-Continent Airport addresses the statutory objective of more flight options, as follows: A total of 11 airlines provide service from Wichita to seven nonstop destinations with connecting service and four nonstop destinations with no connecting service. Overall, there are on average 38 daily (with 40 on weekdays) nonstop or one-stop flights by commercial air carriers, providing access to 4,989 U.S. and international destinations.”
This statement simply addresses the current situation. But the goal is more flight options. Which is better evidence of meeting the statutory goal: A simple recitation of what’s available today, or looking at the trend, especially comparing Wichita to the nation? REAP’s statement provides very little information as to whether the program is meeting its stated goals, or whether the program is desirable. We should ask that REAP recognize the data and its implications.
This trend is an example of unintended consequences of government intervention and regulation. The Affordable Airfares program imposes a rough form of price control on airfares in Wichita. If the program didn’t do that — and it appears it succeeds at this goal — then there would be no point in having the program.
The inevitable effect of price controls is that less is supplied, compared to what would have been supplied. This economic phenomenon is reliable and predictable.
While travelers prefer low air fares to high, this is not the only consideration. For those who need to travel on short notice, the availability of flights is very important, and on this measure, Wichita is doing much worse than the nation.
Data is through March 2013, from Bureau of Transportation Statistics. Since this data is highly seasonal, I present a 12-month moving average, so that each point plotted is the average of the previous 12 months data. Also, I index January 2000 to 100.
The new airport terminal is funded, in part, with passenger fees and the decrease in passengers will reduce the funding for the airport. Higher taxes for the average underemployed and unemployed Wichita residents. Thank You, Mayor Brewer!
Cheapflights.com just announced their fourth annual airport affordability index and it ranked Wichita (ICT) number 70, last year ICT ranked 26. The lower the ranking the less expensive the average price of the tickets.