United Airlines,

in trouble on a variety of fronts, has fired its president and hired a railroad guy.

Railroad guys have been freight guys for a century, indeed it was the freight guys who ruined rail passenger service in the US. And who could blame them? it’s really a pain in the neck to have the cargo expecting to be warm in the winter, fed at regular intervals, delivered on time, talked to politely…passengers are even more trouble than livestock!  We’re supposed to put an string of hopper cars full of nice docile coal on a siding for a handful of passengers? Get serious; we’ve got a railroad to run here.

What could possibly go wrong?

Author: Michael O'Hare

Professor of Public Policy at the Goldman School of Public Policy, University of California, Berkeley, Michael O'Hare was raised in New York City and trained at Harvard as an architect and structural engineer. Diverted from an honest career designing buildings by the offer of a job in which he could think about anything he wanted to and spend his time with very smart and curious young people, he fell among economists and such like, and continues to benefit from their generosity with on-the-job social science training. He has followed the process and principles of design into "nonphysical environments" such as production processes in organizations, regulation, and information management and published a variety of research in environmental policy, government policy towards the arts, and management, with special interests in energy, facility siting, information and perceptions in public choice and work environments, and policy design. His current research is focused on transportation biofuels and their effects on global land use, food security, and international trade; regulatory policy in the face of scientific uncertainty; and, after a three-decade hiatus, on NIMBY conflicts afflicting high speed rail right-of-way and nuclear waste disposal sites. He is also a regular writer on pedagogy, especially teaching in professional education, and co-edited the "Curriculum and Case Notes" section of the Journal of Policy Analysis and Management. Between faculty appointments at the MIT Department of Urban Studies and Planning and the John F. Kennedy School of Government at Harvard, he was director of policy analysis at the Massachusetts Executive Office of Environmental Affairs. He has had visiting appointments at Università Bocconi in Milan and the National University of Singapore and teaches regularly in the Goldman School's executive (mid-career) programs. At GSPP, O'Hare has taught a studio course in Program and Policy Design, Arts and Cultural Policy, Public Management, the pedagogy course for graduate student instructors, Quantitative Methods, Environmental Policy, and the introduction to public policy for its undergraduate minor, which he supervises. Generally, he considers himself the school's resident expert in any subject in which there is no such thing as real expertise (a recent project concerned the governance and design of California county fairs), but is secure in the distinction of being the only faculty member with a metal lathe in his basement and a 4×5 Ebony view camera. At the moment, he would rather be making something with his hands than writing this blurb.

8 thoughts on “United Airlines,”

  1. It really is difficult to run both freight and passenger rail services on the same tracks. They are different kinds of trains and they have different scheduling issues and different travel patterns. Europe, with great passenger rail service, ships about a tenth of much of its freight by rail as the U.S. does. Instead, freight is hauled by truck. Given the wear that truck traffic puts on roads, if you can only do one of them, the U.S. made the right choice and Europe the wrong one.

    1. It's true, but the origins of scheduling issues are that they were done manually, as was switching etc. With current control and switching technology, it doesn't look like a technical problem, but a political and financial one. Since in teh US, most rail lines are owned by freight companies, who have tremendous political power, changing the infrastructure seems unlikely. But it is possible to run both if you want to. Certainly at a better rate than currently, even if it's not optimal (for some value of optimal.)

    2. Wikipedia says rail share of freight is 42% compared to 18% in the EU. So no, not a tenth. How much US rail freight is coal and similar?

    3. In terms of ton-miles per capita for trucks, the difference between the US and Europe isn't actually that big; some European countries may do better, some do worse. The US uses rail a lot more because distances are longer. Freight rail doesn't become cost-effective until after a couple hundred miles or so.

      The problem is that trucks are flexible and cheap even with a sky-high gas tax, road tolls in all the major countries, and (in some countries) bans on driving at nights or on weekends. It's also not really about the wear that truck traffic puts on roads, but the carbon footprint. Fixing roads is relatively cheap (by nation state standards), and since Madrid is the capital of civil engineering in Europe, this is effectively a bit of stimulus for the Spanish economy. But trucks have a much higher carbon footprint than rail does. Ironically, more rigorous emission standards have also lowered the variable costs of operating trucks.

  2. You make a good, somewhat droll point. However, the real question is, can the new fellow manage his way out of a paper bag? Reminds me of working in the business jet realm, many years ago. My company, a business jet broker (buying & selling corporate jets) hired a sales force mainly from non-aviation businesses. A lot of ex-IBM big ticket computer hardware salesmen. They had the sales skill set to get the job done, selling & leasing multi-million dollar pieces of business equipment. No doubt the new guy at United has a lot to learn, but he's accustomed to moving large pieces of equipment from here to there, with all the attendant scheduling issues.

  3. From the article: "Given the complexity of the airline business, it is virtually unprecedented for a major carrier to pick an outsider as its chief."

    My goodness, that airline business must be REALLY complicated. Fortunately for IBM, the computer business must be a lot simpler, so when they brought in that Gerstner fellow from RJR Nabisco, he seemed to do OK.

  4. More interesting to me: whom does he know? If bribing public officials is a significant part of the job of CEO, whom is the new guy going to set up a personal flight (or other perks) for, and to what purpose?

  5. What could possibly go wrong?
    Nothing! United are already looking for a different upstanding governor to cosy up to, like Rick Scott or Bobby Jindal.

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