PlaneBusiness Best of the Banter

Lee Moak had just been elected Chairman of the Delta Air Lines Air Line Pilots Association Master Executive Council. It was not the best time for a pilot to jump into the fray with management. Much less take over leadership of a 12,000 member pilot group that was not very happy.

The airline was precariously close to bankruptcy. Relations between management and the previous MEC Chairman had been "strained." Relations between a good number of Delta ALPA members, members of the press, and the previous MEC Chair had been oftentimes antagonistic.

On the personal side, Lee and his wife Kay had also just moved back to New Orleans. The ex-Marine fighter pilot had originally lived in New Orleans in the late 80s, when he first began flying for Delta Air Lines. But that was before the massive Delta "restructuring" of the early 90s. You remember, those infamous "Ron Allen Leadership 7.5" years. Lee shifted to the JFK domicile.

But now, he was back in New Orleans, a place he now says, "I never should have left." The moving boxes were still sitting unpacked in his new house – a two-story "double" located in the Mid-City area of New Orleans -- when, 40 days after moving to the city, (thankfully just long enough for his homeowners insurance to kick in), and just a couple of days before he was scheduled to report to Atlanta to begin the formal transition to MEC Chairman, the city of New Orleans took a direct hit from Hurricane Katrina.

He called a good friend, "Boudreaux", a Federal Express pilot based out of Memphis, and the two of them came to the conclusion that – literally, come hell or high water – they were going to get into the city – and make sure that Lee's house and his neighbors were okay.

Launching the canoe in Metairie, which is west of the city, the two paddled all the way into Mid-City, at one point canoeing directly alongside the historic Metairie Cemetery.

As many of you probably know, in New Orleans people are buried above the ground. Many of the large family crypts are adorned with large statues and sculptures. The cemeteries are known locally as "Cities of the Dead."

As Lee told me last spring when we first talked about his experience, "Can you imagine – looking out over this expanse of water, perfectly silent….and you're both just paddling…and then we look and we began to see graves. Only then did it dawn on us where we were. We were next to the cemetery. We began paddling along the tops of the graves. They were like houses coming out of the water. That was all you could see. "

As Lee says now, "I really just wanted to go back and see how the house was and how the neighborhood had fared. I didn't know I'd be caught up in a full-blown rescue effort – complete with black helicopters."

He and Boudreaux eventually made it to Lee's neighborhood. His newly-moved-into house was there. It had not been looted. While it had only taken in 4-6 inches of water, that was enough to destroy the bottom floor of the house.

With water levels continuing to rise, he quickly realized there were a number of people from the neighborhood who had not evacuated. Those neighbors who, as he said, were too proud, too old, too poor, or too sick to have left the city in the first place. Or those who refused to leave without their animals. (Yes, this is a fact that many outside of the New Orleans area, for some reason, found hard to grasp after the storm.)

Using the canoe he got some of them to higher ground, and then acted as a connection between his neighbors and the military response teams that finally arrived, seeking out those neighbors who were reluctant to leave – urging them to do so. As he reminded me this last week when we talked, "When you go through something like that – I know it sounds trite – but you really do come away with a very different view of what is really important in life."

Not two weeks after Katrina struck, Delta Air Lines filed for Chapter 11 bankruptcy protection. In tandem with Northwest Airlines.

It was time for the new ALPA MEC Chairman to get to work. With a much better perspective on where this industry's labor/management troubles should fit – in the grand scheme of things.

Lee Moak: Can you hear me okay? I've been having problems with my phone here in the office, and I've come to the conclusion it's not the phone, it's the phone lines coming into the house.

PBB: I can't imagine that being the case. Never. Infrastructure issues in New Orleans?

PBB: Okay, well, since we're already on a New Orleans theme here, who do you think is going to be the next Mayor of New Orleans?

Lee Moak: Oh my gosh. You really are starting with the tough questions. I can say what I think, right? Okay. I'm going to vote for Mitch Landrieu. I can't tell you who Kay is going to vote for though, because, well, she has her own opinions. And she'll make up her own mind. I actually don't think she's decided who she is going to vote for, but I think Mitch is going to do a great job. As you know, the politics in this city are pretty complex. In fact, watching the poltitics here and being involved in a couple of campaigns on the periphery, it makes it a little easier to do work with the Air Line Pilots Association.

PBB: So let's set the stage here for our readers. When did you first move to New Orleans and when did you first start working for Delta Air Lines?

Lee Moak: I left the Marine Corps in 1988, and was hired by Delta. I then came to New Orleans. At that time New Orleans was still a crew base. It was one of the original Delta crew bases, actually.

The base had a rich history and they flew primarily 727s out of here. It was my introduction to commercial aviation and it was very exciting, very interesting, lots of characters, and it really was pretty representative of the best of …the airline business.
At that time we flew routes like New Orleans-Jackson, New Orleans-Atlanta, New Orleans-Shreveport, New Orleans-Monroe, (after flying through Atlanta), and we still had a lot of old time Delta folks still working at all those out stations, much less here in New Orleans.

PBB: So all of this was before the first "restructuring" of Delta that took place in the 1990s. This was classic old-line Delta.

Lee Moak: Yes. As you know, then we had a change in our domiciles, we had a change in chief executive officers, and as part of all that, I left New Orleans and began to fly out of JFK. I returned to the city 40 days before Katrina. So I've been here since then, and I know I'll never leave again.

Lee Moak: Luckily it was 40. If it had been 29 days or less, my homeowner's insurance wouldn't have been in effect when Katrina hit and I wouldn't have been covered. Which is amazing. Who would have ever thought? I was kind of lucky I guess.

Lee Moak: You know, I have a thing for older aircraft. The new airplanes are fine, but you know, I really like the vintage aircraft. It was the same thing when I was in the Marine Corps. I flew the F-4, which was an "old" or vintage fighter and then I went to the new technology and the F-18 for a few years. But yes, I thought the L-1011 was a great airplane to fly. I like the vintage aircraft. But you know, I like them all, and I always like the plane I'm flying at the moment.

PBB: I wondered if you were going to say the L-1011 was your favorite. Many of our subscribers have a very soft spot for that airplane.

PBB: When Delta began to retire the aircraft I know many of our subscribers were very sad to see them go.

Lee Moak: You know, I'm kind of witnessing the same thing at Delta as we retire the Northwest 747-200. There's a strong attraction for that aircraft and I can understand that.

PBB: Yes, I had a subscriber write in to PBB with a detailed review of one of the last flights of a Northwest 747-200 a couple of months ago. Very emotional event for all the employees involved.

Lee Moak: I was on active duty in the Marine Corps for 11 years. Then I went into the Navy Reserves and I flew A-7s down in New Orleans at Callender Field. Then I flew F-18s there for a number of years, and ended up retiring from the Navy Reserves. I retired from the Navy Reserves in 2001.

PBB: So, in your 22-year career as a commercial airline pilot, what would you say is the biggest change to affect what it means to be "an airline pilot?"

Lee Moak: Hmmm. Well, let me go back to when I came into commercial aviation. I came into commercial aviation as a pilot with a pretty good idea of what I thought the job entailed. And that is, you came to work, and you flew a certain number of hours -- a lot of more hours than one flew in the military, if you go back and take a look at that – and you had an incredible amount of responsibility. But when you were done flying, and being a professional pilot on the ground and in the air, when you went home you really didn't have to be involved in the [airline] "business" at that point.

So for me, the biggest change has been coming to the realization that this scenario no longer works. The realization that this business is going to change. Whether you like it or not. And if you want to try and make sure that it changes for the better, in terms of the pilot profession, you have to be involved with that process – no matter what the issue is.

I had no understanding of how the airline business worked. I thought it was relatively simple.

I mean, I thought okay, so somebody buys a ticket, they show up at the airport, they fly to their destination and then they come back.

I had no understanding of restructuring, bankruptcy, competition, debt obligations. I mean, in the Marine Corps, we had a budget every year. But if we went over, I guess the government just printed more money.

I had a pension in the Marine Corps. But that was the extent of my knowledge about pensions. I had no understanding that the outdated pension laws actually, probably, have contributed, for instance, to the termination of many pension plans.

“I had no understanding of restructuring, bankruptcy, competition, debt obligations. I mean, in the Marine Corps, we had a budget every year. But if we went over, I guess the government just printed more money."

Lee Moak: Right. When you are making a lot of money with an airline, at that point you can't put extra money into a pension plan. But when you're losing a lot of money, for whatever reason, at precisely the point you need to be putting money into a pension plan, you don't have the money to put into the plan. So pension laws…then how 'bout fuel prices?

I had no idea that somebody could take fuel "positions" who was not a user, and that these "positions" could then cause these huge fluctuations in fuel prices that would affect me – as an airline pilot.

Security, terrorism, how 'bout the whole history of airline managements and the various executives we've seen come and go? Taxes. The whole idea that Congress can increase taxes on aviation but the industry can't simply just "pass it on." Or how 'bout the idea that you can have a simple "weather event" and it costs your company millions and millions of dollars? I didn't understand that.

Safety? That's probably one of the few areas that was the same as the military. The emphasis on flying safely.

PBB: Then there is the whole joke of how the airline industry is supposedly "deregulated."

Lee Moak: I had no understanding of all the regulations that go along with what is supposed to be deregulation. No question, we are the most regulated "deregulated" industry. Just over the last month, I have been reminded that as a professional pilot, you have to be engaged with the DOJ, the DOT, the NTSB, the FAA, the TSA, the FAMS, the Department of Homeland Security, and I know I've left out a lot.
But you have to know about all of these and what they do – because every one of them can do something that completely changes what you do when you go to work. How you perform what you do.

PBB: So the biggest change to you has been that your earlier assumption about how you go to work, fly the plane, come home and go mow the lawn and don't think about flying until the next time – that's no longer the case.

Lee Moak: Yes, instead of the simple thing…I go to work, I plan for a flight, I take off, I go enroute, I land…what I found out was that it wasn't quite like that.
In fact, instead of being stable, I think the rate of change in this industry is picking up. It's accelerating. Every day. And no, when I started, I really did not see things being this way.

Lee Moak: I'm probably not going to give a popular answer here, but no, I don't think pilot union leaders have been telling their pilots about all the issues they need to be aware of. Because of this, then it comes as a surprise when all these things are changing, and the pilots realize that they have not been a part of the process of change in a way that would affect the change in a proper direction. So no, I don't think they all know that.

“We're all kidding ourselves if we still don't understand that this industry is still in survival mode.”

Lee Moak: Yes. I don't think there is a problem with the "unions" as much as there is a problem with some union leaders. I think some of them are pandering, instead of being matter-of-fact with their members.

PBB: I agree with you. I think there is a huge problem when a union leader, who is supposed to be the person who acts as the conduit between the pilots and the airline's management, fails to lead with a big picture mentality that embraces change, and what is best for the airline -- but instead engages in the same confrontational name calling and posturing that, if anything, seeks to keep the status quo. Which, as you say, simply doesn't work anymore. If you don't change, you're going to be left behind.

Lee Moak: We're all kidding ourselves if we still don't understand that this industry is still in survival mode. This industry just went through a period of ten years of incredible losses. Some people, those with a "short" view, think that now things are turning around and that for the next ten years things are going to be great. Well, the only way that the next ten years will result in sustained profits – a sustained rational industry – will be if labor and management is working together.

PBB: Let me set one thing out here. I don't think you are saying, and I'm certainly not saying, that certain labor leaders are the only problem and that management is blameless.

Lee Moak: No, there is enough blame on both sides. There are many cases where management is clearly the problem, but in that case, labor still needs to step up to the table. And then the challenge is that management has to be able to recognize this. Because if they are not able to work together, in the future, especially with globalization and the rate of this change that we are all enduring, they [the airline] are not going to be around. It's that simple.

If you look back at the industry since deregulation, what is the number of bankrupt airlines – 180 or so – and if you look at the last few years – we've had what – 11 liquidations?

Do you realize that in the U.S. our original flag carriers no longer exist? They went away.

We don't think it could happen again. But again, TWA, Eastern, and Pan Am are gone. If we don't think it could happen again, we're kidding ourselves.

What we need to do, as pilots, is to be engaged with our management teams in changing our airlines so that we can increase revenues so we can cover our costs, and so that we can compete in a global marketplace.

If we don't adapt our business models, we're going to go away. We will fail if we don't adapt.

PBB: It's not popular because it forces a pilot to change his or her perceptions. It's much easier to put forth the same old, "Bash management" way of looking at the world.

Lee Moak: It's easier to say it's somebody else's fault, or that you are a victim.

PBB: But union/management cat fights are not the only problem facing the airlines. As I have written about more and more of late, the airline industry also has to contend with a government, particularly Congress, that appears to have zero knowledge of how the airline industry really works.

Lee Moak: Taxes and regulations. We already know the industry is overtaxed. But then there is the regulation side. Take a look at December for instance. We were all looking forward to 2010 right, and then we have this attempted bombing here at Delta/Northwest airlines.

And so then we get the resulting security directives from the Office of Homeland Security.

You have to wonder how those things actually passed from one desk to another. You had to sit there and just wonder, how in the world does anyone really think that any of these is going to help?

PBB: The whole reaction from Homeland Security and TSA was ridiculous. Embarrassing.

Lee Moak: Absolutely. And when you step back for a minute I think what happened here goes to the foundation and the credibility of those organizations.

PBB: I have something to ask you in reference to some of those directives that came down.

So let me get this straight. We're going to unplug it [onboard maps]so they can't see it, but we're going to tell them, "Hey, we're an hour and half out…." With the whole idea being that they don't have a watch, and they can't tell that the pressure is changing and they're descending.

This is pathetic.

How many people did this stuff go through before it went out?"

Another subscriber has told us that one of the directives issued from the Feds involved disengaging the real-time location maps inside the aircraft. Delta obviously flies aircraft that are equipped with those types of onboard maps. This particular directive infuriated this one subscriber of ours in that he told us that you can't simply do this – that these things are tied into the aircraft's public address system. True?

Lee Moak: We were directed to turn off the in-flight moving maps so that would-be terrorists would not know where we were over the United States. (Pause) Now, let me tell you something. The circuit breakers that control these maps also are connected to the public address system.

Lee Moak: No, not hardly. This is a safety requirement. So that's the first thing. But as you talked about recently, one of the other directives directed us to inform passengers when we were an hour and a half out, and at the point in time they were not supposed to have anything on their laps – blankets, laptops, etc. So let me get this straight. We're going to unplug it [onboard maps]so they can't see it, but we're going to tell them, "Hey, we're an hour and half out…." With the whole idea being that they don't have a watch, and they can't tell that the pressure is changing and they're descending.

PBB: And then the TSA decided to go after travel bloggers who dared to put the directives online. Now, listening to you, maybe the reason they sought to subpeona these guys is because they didn't want the sheer stupidity of what they had issued to show up in print. Online. Maybe it had nothing to do with security.

PBB: But this is just one example of how the industry has to interract with a government which, more often than not, seems to be clueless. What is holding up the slot transfer that Delta Air Lines and US Airways announced in August?

Lee Moak: We as pilots are very supportive of the slot transfer between Delta Air Lines and US Airways at LaGuardia and DC. Why? Because it will allow those markets to act rationally and profitably, which is good for the airline and ultimately good for the employees and pilots.

I was just up in Washington again this week making the case that this is a great deal not only for Delta but for US Airways.

Do you realize that we announced our merger in April of 2008, and had it approved in November?

We announced this slot deal in August and here we are coming up on the end of January and it's still not approved.

So let me get this straight. We can do a merger, but we can't do a slot transfer in the same amount of time?

PBB: Is one of the reasons for this because of opposition from the pilots at US Airways?

Lee Moak: I don't think that's a factor. I just think it's a bureaucracy thing up there between the DOJ and the DOT.

But again, going back to what we started talking about today, who would have thought that, as a pilot, that all of this would have a direct effect on what we do? But it does.

PBB: Then there is Congress. I sometimes think that the only thing members of Congress understand about the airline industry is that "fares are too high."

Lee Moak: It's funny. As many times as I have met with various folks in DC, on many different topics, you know, more often than not, before I leave their office, there is some comment made that goes like this, "You know, airline ticket prices are too high."

I'm not shy about telling them, "How do you reconcile your view that you are pro-airline industry at the same time our current ticket prices do not cover our costs?" Or they'll mention that we don't fly to some particular community.

So here we have someone who claims to be pro-industry but they tell me this? Or they tell me that they think there is not enough competition? Not enough competition?

Listen, everybody has competed to the point that they've gone into bankruptcy, they’ve restructured, it's changed many people's lives, it's moved jobs all over the country, it's caused pensions to terminate. There's been a lot of misery as a result of free-market competition.

And now, we have a simple slot transfer that should have been approved fairly quickly and now has dragged on for months, as the government tries to pick winners and losers, and maybe remove slots that have been paid for through this "free-market system."

And then there is this tarmac rule. I mean, what person in their right mind does not understand that every employee of an airline wants nothing more than for an aircraft to get to where it is supposed to go – ontime? That our only objective is to get people to where they want to go?

PBB: Reminds me of the analogy I always use about cell phone service. Can we please have a regulation that gives me a refund everytime AT&T drops my call?

PBB: Let's move to another topic. The hostile attempt to merge with Delta Air Lines that US Airways launched. As I think you know – I did not think you were giving the possible deal with US Airways a fair shake when you sided with management so tightly against the proposal.

Lee Moak: No, I did not know that. But I'll be happy to tell you why it was that I did not think a deal with US Airways was in the best interest of Delta Air Lines. Having said that, I can perfectly understand why a deal with Delta was in the best interest of US Airways at the time. As it has played out, I can perfectly understand why they were trying to do it.

I didn't think that it was a good deal for two reasons. One, I thought it would keep us in bankruptcy longer than would otherwise be the case. And that posed a bigger risk. Second, using analysis, and not emotion, I came to the conclusion that this would not have been an example of "rational" consolidation. There was a lot of overlap. My thinking at the time was that it was more of a "transactional" bankruptcy deal.The team believed it was a risky decision.

If you compare the proposed US Airways deal to the eventual Northwest merger, this one was more of a "rational" type of deal. A deal with United would have been the same.

Having said all that, I'm not sure too many people understand how close the deal came to going through.

Lee Moak: Yes. That was very close. We were almost US Airways pilots. That vote is never made public, but I can tell you that the vote was not unanimous by any means to turn down the US Airways offer.

PBB: I would be remiss if I did not revisit, in more depth, the concept of globalization, which you have touched on today. I want to give you a compliment, in that the Delta pilot group has been front and center in accepting and promoting Delta's massive growth internationally, even though a lot of that growth also involves codeshare partners. Unlike other pilot groups, who continue to look at globalization as merely an attempt to "outsource" jobs and lower pay rates, you, as the leader of the Delta pilot group have taken the approach that this is a change that airlines, and airline pilots, have to make. Talk to us a bit about that – and how hard it is to get pilots to believe that this is the case.

Lee Moak: Okay, so I talk about this a lot. I usually start out by saying, "How many people in this room were born after 1978?" And you'd be surprised how many of the pilots are now raising their hands.

So, if we had a certain style of engagement with management and government, prior to 1978 [and deregulation], we probably should have adapted after 1978.

Prior to 1978, if you had a job action, you couldn't have replacement flying on your routes, other airlines couldn't pick it up, we could go on and on. But after 1978 you could.

Yet, today, we have the same tactics within the labor world that we had prior to the deregulation act.

So at first, change in the industry was rather slow. Then it began to move much quicker. And now, it's even worse. So now, not only are you going to fail if you fail to adapt. You are going to fail if you adapt too slowly.

Lee Moak: Sure. There have been a few visionaries in the airline business. You could go back and say there was a visionary with frequent flyer miles with American.

You could say there was a visionary at United that built that airline up with an incredible route network and business markets and he went and purchased assets from flag carriers that really benefited that airline.

At that same airline, there was a visionary that came up with the alliance and codeshare idea. I think codesharing could have been handled a little differently, but that's 20/20 hindsight.

You look at those folks, and again, what pilots and pilot leaders need to do – is they need to be engaged. Not only with management. But with all these things that we have talked about today that have an effect on their careers.

What we can expect is to get our fair share of the flying from one country to the next. And if we have a way to connect passengers within that country, that will probably result in more flying – and a profitable airline.

A profitable airline, more flying…more jobs, more ability to increase pay and working conditions.

I believe there should be three U.S. international full-service airlines. Give or take.

I also believe that there should be three major alliances – which we already have.

If you look over at Europe, you see Lufthansa with Star. This was the most powerful alliance. Got ahead of the game with United. And you have SkyTeam AirFrance/KLM with Delta and then Oneworld with British Airways and American. And if you don't think that you're competing with those alliances, you're wrong.

Lee Moak: Look, all you have to do in this world -- union world and aviation world -- is say to yourself, where do I want to be a year from now? Three years from now and five years from now?

That is the way the Delta pilots' team works. Oh, and by the way, it is not just me – it's a very large team. They do a great job. I just end up getting my name out front.
So we, the team, looks at all that and we say, "What do we have to do, where do we need to engage, and how do we want it to be going forward – and then we back it up with actions that we do today."

PBB: But there are still those who think they are going to be doing all that flying.

Lee Moak: If you still think you are going to be doing all that flying, you're wrong.
I can show you how, where, you're wrong.

Granted, it would be nice. But the rest of the world has flying, and what we want to do is we want to fly to every capital in the world. Every city. And we want to encourage other airlines to do more flying. And if we do that, then the pie can get bigger. And if that happens, then that means we get more, and that's a good thing. Pie got bigger, we got more. So, I work hard to explain that and put that out, but it's a tough message.

PBB: Because that is not the message that they have heard, or been led to believe.

PBB: In Phoenix last year you and I shared a stage at the Phoenix International Aviation Symposium. At one point I reminded those in the audience of the significance of what Delta Air Lines management and ALPA had managed to do -- prior to the merger with Northwest. The airline and ALPA managed to get the pilots at Delta to agree to a new contract -- but more importantly, a seniority agreement with the pilots at Northwest -- before the merger was completed. I suggested that perhaps the bad example set by US Airways and its pilot union(s) had made your job easier. You accused me of being hard on you. I wasn't. That was a left-handed compliment.

Lee Moak: I was very proud of what we -- the airline and our pilot team -- were able to do in regards to the merger. Thank you.

PBB: Time to wrap up. But before we do, I hear that pilots fight to get on the Delta ALPA MEC – only so that they can attend the MEC meetings in New Orleans. True?

Lee Moak: Well, yes, I do try to have meetings here. It's good for the city, they are happy to get the money, the food is always great, and well, it's also pretty inexpensive.

PBB: So when I make my next trip to the city, where are you going to take me to eat? Give me your suggestions for somewhere that is not on the usual "tourist" lists.

Lee Moak: Oh, let's see. If you were not from here, of course I would suggest Galatoires. But since you are from New Orleans, I would probably take you to Café Amelie down on Royal. Incredible food. Very well-kept secret. I also like to go to Irene's. You know, Holly, it's hard to get a bad meal in New Orleans.

PBB: Oh, and now for the most important comment. Who dat, who dat, who dat say they're gonna beat them Saints?

Lee Moak: You have to have "faith" that this is the time when a city with so little, that has been through so much, will receive the inspiration that comes from an NFL Championship.