Price Point

There has been a lot of talk about Montana losing its Essential Air Service(EAS) since Big Sky Air shutdown. EAS is a Federal Government subsidy to help airlines fly routes to places that don't have enough traffic to make it pay for airlines to run regular flights.<br />n<br />nI see now though that since there is no EAS service, a private company is flying some of the routes to these places.<br />n<br />n<a href="http://billingsgazette.net/articles/2008/03/24/news/state/60-airtaxi.txt">Air taxi filling void left by Big Sky</a><br />n<br />n<blockquote>A private air charter company is stepping in to provide passenger service that was discontinued when Big Sky Airlines ceased operations earlier this month.<br />n<br />nBig Sky Airlines had a federal contract to provide Essential Air Service to seven Montana cities: Havre, Lewistown, Glasgow, Wolf Point, Sidney, Miles City and Glendive. The company quit providing flights to Billings and Helena from those cities March 8.<br />n<br />nGreat Lakes Aviation, based in Cheyenne, Wyo., will take over the contract and flights, but not until it can get planes and pilots in place, which may be July.<br />n<br />nIn the meantime, Prairie Aviation, an FAA-certified air-taxi service, is flying people to Helena and Billings from Glasgow and Wolf Point in a four-seat Cessna 172 or a six-seat Cessna 310.</blockquote><br />n<br />nCheck out the price points though. Under the government sponsored EAS, a Big Sky airline flight Glasgow to Billings "cost $303, with a $2,818 federal subsidy per flight." The private company with no Government support? <br />n<br />n<blockquote>Flights from Glasgow to Billings are as low as $149 round-trip, with standby charges of $17.50 an hour as the pilot waits for the return trip.</blockquote> <br />n<br />nDo we really need EAS back if private enterprise can do it this cheap? I don't know but the price points are awful interesting. It's always interesting to me how government subsidies drive the price up on things instead of bringing it down like it is supposed to. Can anyone explain this Phenomenon?<br />n<br />n<strong>Every law is an infraction of liberty. Jeremy Bentham</strong>