Peña’s New Airport Still a Failure

by Dave Kopel

February 19, 1997

Denver International Airport, which marks its second anniversary this month, has proven itself a failure and a gigantic waste of money, even by federal standards. Amazingly, President Clinton and the Republican Senate stand poised to give Federico Peña, the former Denver mayor responsible for the disastrous airport, yet another Cabinet appointment, this time as Secretary of Energy.

If Federico Peña succeeds in doing for American energy what he did for Denver, consumers should start hoarding coal. Because the operating record shows that Peña’s new Denver International Airport is performing far worse than Peña promised, and worse than the airport which DIA replaced.

For example, Peña predicted that DIA would attract "non-stop service from Europe, South America and the Far East." One of Peña’s consultants foresaw fifty flights a week to Europe. In fact, DIA has not a single non-stop to another continent. Denver "International" is an international airport only for folks going to Canada or Mexico.

The "need" for DIA was premised on ridiculous projections of passenger growth. But DIA has driven away passengers, thus solving the growth problem. For example, through August 1996, American Airlines’ traffic at DIA was down by 40,000 passengers, while their traffic at the Colorado Springs airport was up 100,000.

Mayor Peña predicted that DIA would attract more passengers than Dallas/Fort Worth and O’Hare combined. More modestly, the City of Denver forecast that DIA would have 17 million passengers in 1995; actually, there were only 15.6 million. In 1996, DIA traffic grew four percent, much slower than the national rate of six percent.

Before DIA, Denver had the fifth-busiest airport in America. Now, DIA has slipped to sixth behind Miami. According to a new study by Aviation Systems Research Corporation, DIA will likely be overtaken by Phoenix and Las Vegas in a few years.

By federal law, DIA is protected from competition; Denver’s Stapleton Airport was required to close the day that DIA opened. But even with a federally-guaranteed monopoly, as well as some of the highest landing fees in the United States, DIA can’t make money. The City of Denver estimates that DIA will lose nearly 300 million dollars in its first three years of operation. In contrast, Stapleton Airport was earning a profit of over 100 million dollars annually.

DIA’s high landing fees, which must be passed on to consumers, have devastated intra-state air transportation in Colorado. Air service to Grand Junction, Durango, and other communities has been slashed, as travelers cannot afford to pay the huge fares which airlines must charge to recoup their DIA expenses.

Once it became apparent that DIA would not become the huge international hub as promised, Peña began claiming that DIA’s main benefit would be increased on-time performance. But even there, DIA is in the bottom half of major U.S. airports, trailing ancient LaGuardia in New York, and the congested O’Hare in Chicago. Stapleton Airport could have been improved to meet or exceed this sorry standard, and for much less than the five billion dollars that DIA cost. Indeed, one of DIA’s major performance advantages is that it handles many fewer flights than Stapleton did, because of DIA’s high landing fees.

Moreover, whatever small gains DIA offers in on-time performance are overwhelmed by the extra time needed to drive to DIA’s remote location, and to travel within DIA’s poorly-designed terminal and concourses. You have to take three escalators and ride a subway to get from the terminal to a concourse. Just to make things extra difficult for travelers with small children, baggage carts are not allowed on the subway or the concourses.

This is not to say that DIA has been bad for everyone. It’s worked out great for Federico Peña. The road to the airport is named "Peña Boulevard." Peña parlayed his airport experience into being appointed Secretary of Transportation. His Transportation tenure will be remembered primarily for the ValuJet catastrophe, and the subsequent cover-up regarding ValuJet’s well-documented and miserable safety record. Peña’s other major accomplishment at Transportation was to massively increase air passenger surveillance, so that it has become impossible to fly anywhere in the United States without producing a government identity card; carry-on baggage is now hand-searched randomly, without the slightest suspicion.

According to the Peter Principle, individuals tend to get promoted until they reach their level of incompetence. But the last job Federico Peña was good at was Colorado State Representative. He’s now done lousy at two jobs after that, and on his way to becoming Secretary of Energy. Is replacing the Peter Principle (one level of job failure) with the Peña Principle (three levels) what President Clinton meant by "reinventing government"?

Dave Kopel is Research Director for the Independence Institute, a free-market think-tank located in Golden, Colorado.

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