Merger of 2 airlines could turn Detroit into 'Airport City'

2/29/2008

DETROIT - Whatever anyone thinks about Southeastern Michigan, this much is clear: It badly needs economic revitalization. It's also clear that a newly resurgent Detroit economy would help the rest of the state. Ed McNamara, the late Wayne County executive, dreamed of a concept he called "Airport City."

That would involve creation of a bustling, job-rich, consolidated passenger and freight-handling center that would stretch from Detroit Metropolitan Airport in Romulus to Willow Run Airport in Ypsilanti.

Warehouses, modern-day marshalling yards, and assorted businesses would spring up in the 27,000 mostly undeveloped acres between the two airports, creating thousands of jobs.

Everyone agreed that sounded like a wonderful idea. Sadly, until now, all the signs have been that it would stay just that - a wonderful idea - since the critical mass needed to make it happen was lacking. But then, Northwest Airlines and Delta began serious merger talks that just might change everything. Most airline mergers have been ballyhooed as being great for the industry and great for the consumer, but have turned out to be neither.

This one, however, may be different. The two airlines service substantially different international routes. Delta is strongest in service to Europe and South America. Northwest focuses on Asia. (It used to be called Northwest Orient, after all.)

A merger of the two would create the world's biggest airline, and, longtime Minneapolis-based industry analyst Terry Trippler estimated, result in the loss of no more than 2,000 or so jobs worldwide.

Phil Power, the founder of the nonpartisan, pro-growth Center for Michigan, is big on the deal. "A merger could play to Northwest's Michigan-based crown jewels: the magnificent airport hub at Detroit Metro and the airline's profitable and rapidly growing routes to China, Japan, and the rest of rapidly booming Asia."

That, he thinks, could easily make Detroit "the premier gateway to Asia and a tremendously attractive hub for travelers to Europe and South America." And in the process, he thinks it at last could provide the "critical mass" needed to spur Airport City into reality.

Mr. Trippler, a recognized national expert on airline industry trends, agreed in a telephone interview that the deal could easily spur economic growth in the region.

Merger talks have hit a snag, based largely on difficulties involving seniority issues between pilots for the two airlines. Rep. James Oberstar (D., Minn.), chairman of the House Transportation and Infrastructure Committee, also opposes it. Such a merger would mean a loss of perhaps a thousand administrative jobs in his district, which is home to Northwest's world headquarters.

Nevertheless, Mr. Trippler said there was a "90 percent chance" the merger would go through. "It's going to happen," he said.

Happen, that is, if the anti-trust division of the U.S. Department of Justice approves. There is some concern lest the merger choke off domestic competition, especially from new, low-cost carriers such as Spirit and Jet Blue. But most anticipate that won't be a big problem. And if a Delta-Northwest merger creates anything like the "thousands and thousands" of support industry jobs Mr. Power anticipates, it will be welcome indeed.

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So what now for Detroit's mayor? Beyond the shadow of a doubt, Kwame Kilpatrick's conduct clearly makes Richard Nixon look like a choirboy in the church of good government.

That's clear from a passel of documents released Wednesday, after the mayor's final appeal was rejected by the Michigan Supreme Court. The documents leave no doubt that the mayor lied under oath about his sexual escapades and about plotting to fire a police chief.

He also orchestrated a massive cover-up designed to deceive city council into paying $8.4 million to police officers whose careers were ruined after they attempted to investigate the mayor.

Sharon McPhail, the mayor's general counsel, blithely said she saw "nothing here that substantively is of concern." But she was out there, pretty much by herself, on that one.

Detroiters are waiting for the final shoe to drop, to see if Wayne County Prosecutor Kym Worthy moves ahead and files criminal charges for perjury and other offenses. But behind the scenes, several politicians are already quietly planning campaigns for the special election that - if the mayor resigns - would take place 90 days later.