Not many people were surprised to learn, in October, that the CIA undertook 'economic' spying on US trade rival Japan. The high-profile impetus for the intelligence gathering was the US-Japan automobile trade talks that were resolved in July after the two sides negotiated an eleventh-hour settlement under the spectre of threatened sanctions by the US.
After the news was leaked Asian countries protested against the intrusion while the US, just as predictably, dismissed such complaints. (The quality of the gathered information, it was said in a mysteriously unresponsive attempt to mollify the aggrieved, was inferior anyhow.)
What the US did not say was that car manufacturing was not the only sector that the CIA was monitoring. In casting its information gathering net out to retrieve sensitive negotiating-stance information, the agency apparently caught several official communiqués regarding Japan's negotiating stance on its aviation relationship with the US. At the time, aviation trade was producing as much friction as the auto trade talks, because of Japan's refusal to allow Federal Express to increase its services beyond Osaka. Department of Transportation secretary Federico Peña went so far as to threaten sanctions against Japan's cargo airlines, though all the tension was defused at the last minute.
According to congressman James Oberstar, US intelligence officials contacted him in July and said that several sensitive voice cables being transmitted between Japan and outlying embassies had been retrieved. Before coming to his office in Rayburn House, the CIA sent an advance team to prepare the quarters by searching for bugs and taking other precautions to assure secrecy. There, along with House speaker Newt Gingrich, the cables were played and translated. As with the CIA's information gathering abilities for auto negotiators, the presentation contained nothing of any merit to negotiators, according to Oberstar.
AMR is outflankedThe failure of the US-UK bilateral negotiations in October has thrown secretary Peña's international aviation strategic vision into question. This has been the end result of a negotiation that was near to fruition before an internecine battle between US carriers resulted in TWA politically outmanoeuvring American Airlines, the traditional lobbying powerhouse of US carriers.
The decision not to accept the UK's offer for two US airlines serving Gatwick to move to Heathrow while permitting another airline to serve New York-Gatwick was criticised as a backward step by Peña, who this year has continually talked up the benefits of negotiating interim 'mini deals' towards liberalising the US-UK aviation accord. If that was the case, observers noted, why refuse to accept a deal that in the end was likely to have given American access to Heathrow from Dallas, while permitting TWA to get back into US-London, a market that it forsook in 1991 when Carl Icahn sold the airline's Heathrow rights to American?
The reason was because TWA long ago decided that Gatwick simply would not do. Having concluded that the only acceptable US position would be one that got it into Heathrow, the St Louis carrier went on the attack to sink the deal when it was clear that US negotiators wanted to conclude this phase of negotiations. Missouri congressman Richard Gephardt made it clear to Peña that he was not pleased with the prospect of TWA having to serve Gatwick.
All this leaves TWA without any London service, American without its coveted Heathrow service from Dallas, and Peña having to face hostile questions about policy consistency when he testifies in a Senate hearing that Arizona senator Tom McCain has called. AMR officials are prodding their allies in Congress, like McCain, to ask why mini deals were good for getting United Airlines access to Heathrow from Chicago, but not for getting what American wants.
FAA takes Latin heatWhen Federal Aviation Adminis- tration associate administrator Anthony Broderick announced the latest results of the FAA's international aviation safety assessment programme at the November Airline Business/SH&E conference in Miami, he knew he would be targeted for criticism.
The five new countries rated against Icao safety standards as 'Category 2', also termed 'conditional', are Ecuador, Peru, Venezuela, Israel and Jordan.
Category 2 is the middle ground between Cat 1 and Cat 3, the latter being the most draconian in that airlines from the affected country are not permitted to fly to the US. Still, 'conditional' listings cause airlines economic pain as well. Airlines from a country like Peru may continue service to the US but may not incre- ase capacity or frequencies, and cannot introduce extra aircraft or codesharing deals.
This obviously rubs carriers from Cat 2 countries the wrong way. Broderick was, subtly if not overtly, accused of wielding an imperialistic test that would, in the end, give US carriers solid economic benefits. Henry Boulton, CEO of Avensa of Venezuela, was clear with his criticism: 'You have an airline that is operating under all the Icao compliances and then the country is put under Category 2. The travelling public thinks the flag carrier is dangerous, and I don't think that is fair. There is direct damage.'
Officials from Colombia, soon to be ranked as conditional, were also irate, as were Peruvian industry executives. Being placed in Cat 2 is particularly injurious to the likes of Faucett, which is taking delivery of a new A300 for service to the US. It will not be able to put the aircraft to work because of the freeze, while the new US-Peru bilateral will permit Continental Airlines to begin serving the country.
Broderick, who continuously insists that countries - not airlines - are the subject of study, hesitantly admits that the ranking does have a bottom-line effect. But, he adds, the US believes some economic harm could induce political activism for air safety. 'The most powerful people in some of these countries are executives at airlines.'
Mead Jennings
Source: Airline Business
