Patriotism Wanes for Fly America Act

n October 1996, State Department employee Desiree Fray flew from her duty station in South Africa to Washington on business. She was routed through Miami. On her return, that flight wasn't available, so her travel management agency routed her through London for the same fare. When she filed her travel voucher, Fray was assessed a penalty of $1,357.88. What did she do wrong?

Fray flew back to her post on South African Airways. The Fly America Act, passed in 1958, requires anyone traveling on U.S. government money to fly U.S. carriers, with only limited exceptions. While many federal employees and service members aren't bothered by the rule, others say it makes getting their jobs done more difficult and more expensive.

John Wasielewski, who's on the road one-quarter of his time for the Agency for International Development, finds that flying only U.S. carriers sharply reduces his choices of routing and departure and arrival times. The bottom line: It costs his department more, he has to take longer flights with more stops, and sometimes he misses a weekend he could have had at home. "It's just inconvenient," he says.

Other frequent overseas travelers at the State Department, AID and the Defense Department go further: "It's a nightmare-it's insanity," says a federal lawyer who makes two to four overseas trips a year for two weeks at a time. "A bust," says a Navy civilian. "A real pain in the butt," says a DoD official. "A rip-off of U.S. taxpayers, and an inconvenience to those flying on the federal dime," says a Capitol Hill staffer who watches the issue closely.

"I'm always outraged by the cost," says the traveling lawyer. If allowed to fly with a foreign carrier, "I know I could get a better price." But if someone tried to "creep up to the Hill and change the law," says the DoD official, "no way."

Another federal worker, who traveled to six countries last year, asks, "Why do we have the Fly America Act? "Is this a boon to corporations only?" She and others point out that the law runs counter to national policy moves, such as the North American Free Trade Agreement and normalized trade status for China, that open up the U.S. economy.

National Interest

According the General Accounting Office's Civilian Personnel Law Manual [OGC-89-8], "[T]he act's purpose was to counterbalance the dominance that foreign carriers enjoyed with respect to business and government air traffic originating abroad, while rectifying an imbalance in the international air transportation market favorable to foreign air carriers, many of which are subsidized or otherwise assisted by their respective countries, and, therefore, able to offer reduced fares or more attractive routings." But it's more complicated than that.

To really understand the Fly America Act, you have to take a trip back in time to the years right after World War II. Congress, the Defense Department, the President and the airlines were debating the circumstances under which DoD could commandeer civilian aircraft and their crews for military use.

Defense set up the Civilian Reserve Air Fleet (CRAF) under which commercial airlines will lend their equipment, staff and services to the department in times of national security. The program is voluntary, but there's a catch: Any company that does not participate may not bid on any military or government business, including the city-pairs program. The Fly America Act, says Delta Airlines' Jerry Ellis, is "payback" for that obligation.

"We're making a commitment to the government in a time of crisis," says Mike McFarland, military sales director for Delta. He sees CRAF as the industry's role in protecting the national interest. "If [the government] needs people or cargo moved around, they can't depend on a foreign carrier to lend an airplane."

CRAF has only been activated once: during Desert Shield/Desert Storm. In 1990 and 1991, commercial carriers, not Defense aircraft, moved 70 percent of U.S. military passengers and 80 percent of cargo for that conflict. That added up to some 5,000 trips by more than 30 commercial carriers, says National Air Carrier Association director Ron Priddy, each averaging six legs. Priddy, a former Air Force colonel, was director of CRAF and oversaw the Desert Storm call-up.

In 1998, the General Services Administration relaxed part of the Fly America Act rules. Key changes included dropping the requirement that tickets be on a specific kind of paper, reducing the number of layover hours needed to allow a Fly America Act exception, and clarifying when code-share arrangements can be used.

Airline Allies

As airlines have paired up and formed alliances, travelers have found themselves mystified about what companies they are doing business with. An itinerary or ticket might bear one name, a check-in counter or aircraft another. This confusion could have major (read: big bucks) consequences when the alliance is between a U.S. flag carrier and a foreign flag carrier. The new rules state that a foreign flag carrier may be used if it is under such a code-share arrangement with a U.S. airline.

The regulatory revisions brought significant opposition from the airline industry, says GSA travel policy director Bill Rivers. The industry's reaction was "if you start chipping away at Fly America, we'll wake up one day and it won't be there," he says.

The major organized opposition to the Fly America Act comes-no surprise-from foreign carriers and their governments, who see the law as protectionism and want to be able to compete for government business. In a May speech to the international aviation club, Swissair president and CEO Jeffery Katz called it a "vestige of the past."

For those in the United States and overseas who want to change the law, the outlook is bleak. "There are entrenched interests against changing it," says one congressional staffer. He sees "compound obstacles to a wholesale change." So at least for the time being, Fly America is here to stay.