Has to be the headline of the day

Sandy Ikeda titled his blog entry on the Obama Administration’s decision not to auction landing slots at NYC airports, Airports: Coase, but no cigar.

Ikeda writes

A year ago the Bush administration proposed auctioning landing slots at Kennedy, LaGuardia, and Newark airports in the New York region. Yesterday the Obama administration canceled these plans. From the NYT article:

“In proposing to rescind the auctions, the department noted that the rule making was highly controversial and that most of those filing comments opposed the slot auctions,” the Transportation Department said in a statement. “The Department also noted that circumstances have changed since the rules were issued, including changes in the economy.”

Interestingly among those who were opposed to the auction were the airlines themselves. It turns out that the Bush administration argued the slots are the property of the FAA while the airlines claimed the slots belong to them. This looks like just a fight over who gets the rents from the auction rather than a efficiency issue.