'Open Skies' Closing

The "open skies" treaty with the European Union, removing most restrictions on air travel between here and there, is a good deal all around, especially for travelers - more choices, more destinations, perhaps even lower fares.

The treaty would allow EU airlines to fly to any destination in the United States and U.S. carriers to fly to anywhere in the 25-nation EU. Previously, foreign airlines could fly here only from the country where they were based - Air France from France, Alitalia from Italy, etc. They still would not be allowed to fly domestic U.S. routes.

But the treaty is being delayed by a separate dispute. U.S. regulations limit a foreign airline's ownership stake in a U.S. carrier to 25 percent, and still further restrict the foreign firm's say in the American company's management. Not surprisingly, foreign airlines have seen fit to forgo that investment opportunity.

Easing the 25 percent ownership cap and the management restrictions might attract fresh capital and fresh ideas to the industry. But the Bush administration is considering tightening the regulations instead.

The administration seems to have lost the heart for free-trade battles, so the tighter regs may be issued.

There are, according to Web sites that follow the industry, four U.S. airlines, including Northwest and Delta, in bankruptcy; and a fifth, Independence, being liquidated; and others, including United, US Airways and Continental, that have reorganized under bankruptcy protections.

Just who are we protecting here? Domestic airlines from competition, or foreign airlines from making bad investments?

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