Don't Give Up Fifth Freedom Rights

<H1>Don't Give Up Fifth Freedom Rights</H1><H3>by Richard B. Hirst</H3>Enough is enough, Gov. Baliles. For months, ACCESS U.S.-Japan and your primary sponsor, American Airlines,have been misleadingthe public about the success of U.S. aviation relations with Japan.

Here are some indisputable facts. The source is totally objective-a recent study, "Turbulence Over the Pacific," by the Economic Strategy Institute. The principal author is Japan trade expert Clyde V. Prestowitz Jr.

First, air travelers between the United States and Japan are not being turned away for want of seats. Department of Transportation data show 28 percent of the seats between the U.S. and Japan fly empty-more than are vacant between the U.S. and Europe.

There is more service between the U.S. and Japan than between the U.S. and the United Kingdom-32 percent more based on seats and 5 percent more based on flights. In advancing your contrary and false proposition, you left out Hawaii-the number-one destination for Japanese tourists.

Second, consumers do not pay comparatively high prices for flights to Japan. Trans-Atlantic and trans-Pacific fares are virtually indistinguishable on a cost-per-mile basis. In its study, Economic Strategy Institute found a roundtrip between Los Angeles and Tokyo cost .0486 cents per mile, and a roundtrip between Los Angeles and London cost .0522 cents per mile.

To support your false assertion that passengers to Japan pay 25 percent to 60 percent more than they should, you chose to rely on "published" fares instead of selling fares. That's like saying that a car that sold for $20,000 really cost the consumer $32,000 because that was the price on the manufacturer's sticker. Actual fares in the Japan market are heavily discounted from published fares.

You claim that the Access proposal would generate more than $9 billion in annual economic benefits to the United States. That too is a mirage. Your $9 billion figure is driven by assumed increases in traffic stimulated by assumed decreases in fares.

You say your coalition seeks to expand access for all carriers, but it is nothing more than a front organization for American Airlines. Despite your claims of a broad-based membership, there is little evidence of member involvement in your activities.

Economic Strategy Institute calculates that if the U.S. were to agree to your proposition-that is, trading existing U.S. "Fifth Freedom" rights to fly to Asia through Japan-the impact on the U.S. economy by the year 2010 would be devastating: 168,000 lost jobs, $3.9 billion in lost U.S. carrier revenues, $6.4 billion in reduced U.S. economic activity and $3.7 billion in reduced U.S. trade receipts.

To serve Asia, U.S. carriers must have hubs in Japan. Today's aircraft are unable to fly non-stop from North America to many points in Asia. Even as aircraft ranges are extended in the future, most Asian cities do not generate enough traffic to justify high-frequency direct service with the U.S. Without Fifth Freedom rights, U.S. carriers will be forced to cede the lucrative U.S.-Japan-Asia market to the higher-priced Japanese carriers.

As the U.S. works through this difficult negotiating process, we all should focus on the overriding issue: The need to protect existing U.S. Fifth Freedom rights.

These rights, which are being withheld by Japan, are far more valuable to the U.S. than a few more point-to-point routes. Japan's longstanding agenda has been to constrain our rights. We should not invite them. If we do, Japan will make us pay dearly.