Testimony issued by the Government Accountability Office with an abstract that begins "Earlier this month, United Air Lines (United) and Continental Airlines (Continental) announced plans to merge the two airlines and signed a merger agreement. This follows the acquisition of Northwest Airlines by Delta Air Lines (Delta) in 2008, which propelled Delta to become the largest airline in the United States. This latest merger, if not challenged by the Department of Justice (DOJ), would surpass Delta's merger in scope to create the largest passenger airline in terms of capacity in the United States. The passenger airline industry has struggled financially over the last decade, and these two airlines believe a merger will strengthen them. However, as with any proposed merger of this magnitude, this one will be carefully examined by DOJ to determine if its potential benefits for consumers outweigh the potential negative effects. At the Committee's request, GAO is providing a statement for the record that describes (1) an overview of the factors that are driving mergers in the industry, (2) the role of federal authorities in reviewing merger proposals, and (3) key issues associated with the proposed merger of United and Continental. To address these objectives, GAO drew from previous reports on the potential effects of the proposed merger between Delta and Northwest and the financial condition of the airline industry, and analyzed Department of Transportation (DOT) airline operating and financial data."
We investigate the competitive effects of the merger between Delta Air Lines and Northwest Airlines (2009) in the domestic U.S. airline industry. Applying fixed effects regression models we find that the transaction led to short term price increases of about 11 percent on overlapping routes and about 10 percent on routes which experienced a merger-induced switch of the operating carrier. Over a longer period, however, our analysis reveals that both merger efficiencies and post-merger entry by competitors initiated a downward trend in prices leaving consumers with a small net price increase of about 3 percent on the affected routes.
The collection consists of papers of W. J. "Bill" Usery from 1940, 1942, 1952-2004. The International Association of Machinists series (1940, 1952-1969) documents Usery's involvement and participation with labor unions and the arbitration process. The United States Government series (1969-1977) pertains to Usery's government career, while the Bill Usery Associates series contains material relating to Usery's labor-management negotiation firm in Washington, DC. The Client and Mediation Files series (1942-1997) documents Usery's personal, and his Bill Usery Associates, Inc. labor-management consulting firm's, involvement in dispute resolution, strike settlement, and workplace productivity; it forms the bulk of the latter portion of the collection. The Name and Subject Files series (1963-1965, 1970-2004) includes material related to Usery's appointments to Presidential Commissions, while the series Oral History Transcripts and Materials (1967-1986) relates to Eastern Airlines and the Federal Mediation and Conciliation Service. The 2,265 photographs mainly consist of Usery at various points in his governmental service and form the final series in the collection. Artifacts include model rockets launched at the Kennedy Space Center. ; Born in Hardwick, Georgia, December 21, 1923, Willie Julian Usery, Jr. has been known as "Bill" throughout his life. Educated at Georgia Military College (1938-1941) in Milledgeville, Usery worked as a machinist at naval shipyards in Brunswick, Georgia, and later as a Navy enlisted (1943-1946) underwater welder on a repair ship in the Pacific Fleet. While working as a maintenance machinist at the Armstrong Cork Company, Macon, Georgia (1948-1956), Usery attended Mercer University. Usery was a founding member of the International Association of Machinists' Local 8 (joining March 1, 1952, what is now Local 918), eventually becoming its president and later IAM Grand Lodge Representative from 1956 until February 1969. In 1961, while ""GLR"" Usery was appointed industrial union representative on the President's Missile Sites Labor Commission at Cape Canaveral (Kennedy Space Center from 1963 on) and at the Marshall Space Flight Center in Huntsville, Alabama. Additionally, Usery coordinated union activities at the Manned Spacecraft Center, Houston, Texas, and in 1967 became a member of the Cape Kennedy Labor-Management Relations Council, serving as its chair in 1968. In February 1969, Usery received his first Presidential appointment from Richard Nixon as Assistant Secretary of Labor for Labor-Management Relations. While administering the Labor-Management Reporting and Disclosure Act (LMRDA), Usery formulated and implemented Executive Order 1199, establishing standards of organizing and bargaining for more than two million Federal employees. In 1970 and 1971, Usery worked intensively to settle disputes in the railway industry involving the Brotherhood of Airline and Railway and Airline Clerks (BRAC) and the United Transportation Union (UTU). Employing his characteristic non-stop negotiations, Usery had already averted a 1971, nationwide strike by the Brotherhood of Railroad Signalmen. Also in 1971, Usery had obtained the first collective bargaining agreement in the United States Postal Service's history. From March 1973, and until February 1976, Usery held the post of Director, Federal Mediation and Conciliation Service, guiding more than 300 professional mediators in 79 field offices throughout the United States. During this period, Usery was chief mediator in major labor-management disputes, plus he advised Presidents Nixon (Special Assistant to the President for Labor-Management Affairs, August 1974) and Ford (Special Assistant for Labor-Management Negotiations, April 1975) on the status of the nation's labor-management relations. In October 1973, the AFL-CIO Council voted unanimously to offer Usery the directorship of the Department of Organization and Field Services, which he accepted but then declined at the request of President Nixon. In February 1976, President Gerald Ford appointed Usery United States Secretary of Labor, a post which he held until Jimmy Carter became President on January 20, 1977. Almost immediately following the end of Usery's government service, he founded Bill Usery Associates, Inc. (BUA), a Washington, D. C.-based firm providing consulting services in all areas of employer-employee relations. Usery has also been selected to serve on Presidential Commissions, i.e. the Commission on the Future of Worker-Management Relations and the ""Coal Commission."" Bill Usery and Associates served as the catalyst for pioneering negotiations among the United Auto Workers, Toyota and General Motors to produce the entity popularly known as "NUMMI" the New United Motors Manufacturing, Inc. (established 1983). NUMMI's inception involved Usery's firm in international negotiation, planning for productivity, and a wholly new way to foster labor-management cooperation. High profile strikes involving Usery and his firm's mediation talents included the Pittston Coal Strike (1989-1990) and the Major League Baseball Players Association Baseball Strike (1994-1995). Usery remains ""on call"" as a special mediator as presidents seek to resolve labor conflicts. Usery was a Co-Commissioner of both the Coal Commission, seeking to resolve thorny issues involving miners' retirement funding, and the Commission on the Future of Worker-Management Relations (1993-1995). In 1985, Usery established the Bill Usery Labor Relations Foundation, which helped create Partners in Economic Reform, a group working with democratic labor and management in the former Soviet Union. In the mid-1990s, Usery's vision of labor-management cooperation found a home in the W. J. Usery, Jr., Center for the Workplace at Georgia State University, a entity with wide programmatic aims in collective bargaining, workplace productivity, and dispute resolution serving company and union leaders. In early 2000, Usery scaled back his work in the Washington, D. C. area to shift his focus to the work of the Center.
A letter report issued by the General Accounting Office with an abstract that begins "In May 2000, two of the nation's largest airlines, United Airlines and US Airways, proposed merging. As part of the agreement, United and US Airways also proposed divesting some of the US Airways' assets at Ronald Reagan Washington National Airport to create an airline to be known as DC Air. The Justice Department is now reviewing the proposal to determine if the merger would violate U.S. antitrust laws and, if so, whether the proposed divestiture constitutes an adequate remedy. GAO reviewed the proposed merger and found that it would create an airline so large that it would spur further industry consolidation. The new airline would have more than 25 percent of the total U.S. market and would take in almost $9 billion more than the next largest airline. Although the proposed merger may benefit consumers by boosting competition in some areas, it could also eliminate competition in other areas and reduce consumer choice. DC Air would face significant competitive challenges from other airlines. DC Air would offer smaller aircraft and less frequent service but would seek to compete with other airlines by reducing its fares."
"(96-5)" ; Text of Airline deregulation act of 1978: p. 1-50. ; At head of title: 96th Congress, 1st session. Committee print. ; Mode of access: Internet.
Corporations intent upon expanding via the acquisition route have had three statutory hurdles placed in their way by the Congress of the United States. As hurdles, the first two, the Sherman Act of 1890 and the Clayton Act of 1914, were failures. A judiciary which refused to give effect either to the language or intent of the acts nullified completely their usefulness as anti-merger weapons. The third hurdle, the Celler-Kefauver Amendment to the Clayton Act, was enacted in 1950. Relatively few judicial opinions have interpreted this act, "new section 7," as it is called. It is clear, however, that it has little to fear in the way of a hostile judiciary or Federal Trade Commission. So far at least, delays which can be characterized only as incredible have been the sole serious problem for "new section 7. "Shortly before the turn of the century, a great merger movement began in the United States. Although the Sherman Act was the law of the land, effective action under it could be taken only after a monopoly had been achieved, if then. By 1914, it was clear to a majority of the Congress that, if the growing merger movement was to be checked, new legislation was needed. As enacted into law in 1914, section 7 of the Clayton Act contained a civil prohibition against the acquisition of stock of one corporation by another where the effect of the acquisition "may be to substantially lessen competition between the corporation whose stock is so acquired and the corporation making the acquisition, or to restrain such commerce in any section or community, or tend to create a monopoly of any line of commerce."
