Service Cuts May Follow Merger Of Airlines

The airline industry took a decisive step toward greater concentration on Thursday with the announcement that American Airlines and US Airways had agreed to merge, forming the nation’s biggest airline.  The merged airline, to be called American, leaves just three major carriers — Delta Air Lines and United Airlines too — able to offer extensive domestic and international service, a sharp contraction over the last decade.

But while airline executives argue that mergers are good for passengers because they bring more service to more destinations, some economists and consumer advocates warn that all this consolidation comes at a price for travelers.

With fewer carriers, passengers have fewer options; fares and fees are now more likely to go up, particularly for flights between midsize cities.  And more cities, especially smaller ones, can expect to see further reductions in service.

“It’s much easier to have tacit collusion with just three airlines,” said George Hoffer, a transportation economist at the University of Richmond.  “It’s not illegal.  But it’s like having a few big people in a small boat. Anyone’s decisions tie you all together.”

Read more:  http://www.nytimes.com/2013/02/15/business/airline-consolidation-may-be-costly-to-travelers.html?pagewanted=1&_r=0&hp

Governor Christie Quietly Takes On New Jersey Lottery

English: , U.S. Attorney, Governor-elect of Ne...

English: , U.S. Attorney, Governor-elect of New Jersey (Photo credit: Wikipedia)

TRENTON – Gov. Christie hasn’t held a news conference about it, and his treasurer has refused to testify on it.  But the Republican governor is close to privatizing the bulk of a $2.8 billion New Jersey institution.

Following a national trend already under way in Pennsylvania, Christie is negotiating a 15-year contract with a company to operate the state lottery in an effort to increase sales, thereby building more revenue for schools and state institutions.

Like Pennsylvania’s Republican Gov. Corbett, Christie bypassed the Legislature, much to its chagrin, in bidding out the system.  And like Pennsylvania, New Jersey got just one bid in response to its request for proposals.

Unlike in Pennsylvania, where the pending contract was ultimately posted online and must be submitted for approval to the Democratic attorney general, New Jersey’s lottery bid is not public.  Christie could just sign a contract in the next two months.

Read more:  http://www.philly.com/philly/news/politics/nj/20130128_Christie_quietly_takes_on_lottery.html