Monday, July 24, 2006

One Good Idea for Today

There is a scene in the film Syriana where Matt Damon's character is talking with the Prince of the fictional Emirate and after the Prince appoints him economic adviser Damon says, "You want an idea, here's an idea." Then, he proceeds to lay out a strategy to change they way they market their crude oil. He concludes with, "Your profit just went up by a factor of three, possibly four. I think that's a pretty good idea."

For a movie about the power of oil, the point of this scene is to illustrate that those blessed with the riches often satisfied to let the world beat a path to their door instead of using it as economic leverage.

Take, for example, the fact that New Orleans has/had a tourism dependent economy. Given that, it is unlikely to recover while the worldwide perception of New Orleans remains a place of devastation, martial law, crime, and blight. For now New Orleans is somewhere between Sarajevo and Beirut in "Top Ten Cities Destroyed By Armies" tour, and that's it.

Meanwhile, the global airline business is in the process of modernizing. Longer range aircraft are soon to be delivered by Boeing and Airbus. These are planes that can bypass the hub and spoke system, particularly for international travel.

Louis Armstrong Airport has one 15,000 foot runway that would accommodate either the 787 or the Airbus 380, but there is a fat chance that Lufthansa or JAL wants to send their new flagships our way, unless...

... we made it worth their while. Forget subsidizing Home Depot and Lowe's with our recovery plan for a moment. What if Louisiana took some of the funds it received from record high oil prices and created a fund to subsidize fuel purchases by airlines servicing Louis Armstrong Airport for the next two years? The caveat could be that it would be targeted at large planes from more than 1,000 miles away.

Oil is power. In a world dependent upon petroleum, why not use that power to influence the behavior of others?

This is a perfect alignment of Louisiana's strengths and weaknesses with that of the airline industry.

Even better, it is one area in the airline service sector where Louisiana has a competitive advantage over Mississippi's gigantic Stennis facility. And, speaking of Mississippi, it is very likely that visitors from Europe, South America and Asia that come to New Orleans as their port of entry to the USA would want to be in New Orleans, and are not going to be tempted by cheap rooms in Biloxi like some kind of bowl game crowd.

Unfortunately, though nearly painless, one can suspect that the smugly emboldened Kenner-diots [those who bought homes next to an airport and then wanted it closed to improve their property values] would not see this as an elegant solution. For them, picturing the view of giant aircraft stacked up over the Manchac swamp as far as the eye can see would provoke the look of Tom Cruise in "War of the Worlds". Further, can you see other parts of the state 'giving away' windfall money from high oil prices to something in New Orleans?

Coda: I am reposting a few of the points I made in my inaugural post...

5) Government spending alone will not return the City from the one hundred fiftieth or so largest city in the nation back to the 31st largest.

6) Outside money does not create opportunity, it finds it.

7) World Class is not going to come from above, it is only going to come from within.

8) "If nothing changes, then nothing changes"


Anonymous said...

An interesting idea.

LatinTeacher said...

I think what are proposing is called "synergy." And its an outside the box thought. Now to find the right audience for such a great proposal...

Nabil said...

Great idea in theory, but it would require some inter-agency cooperation on the local level that I find unlikely to emerge. Can you combine an oil subsidy with airline incentives? There's got to be some anti-trust issues out there somewhere. That said, it's a real neat idea.

Mr. Melpomene said...

This idea stems from an argument I had with an attorney friend of mine who has consumed way too much Landrieu Cool-Aid. His statement was that Mitch was the 'Best Lt. Governor' we had ever had and had done a great job at recovering tourism in time for Jazz Fest. I said, if he wants to show how powerful Team Landrieu could be in DC and Perdido, why doesn't he give us a taste of that by, say, getting the FAA to open new international routes to NO.
I think this idea (my subsidy idea) is a intriguing discussion point and maybe it will evolve into something. Anti-Trust is not a factor, as it accrues a surplus to the public, does not lead to higher prices.