Air Support

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US Airways had a tougher climb than America West. For two decades, beset by demanding unions and weak management, the airline has had the highest labor costs in the business. From 1985 through 2003, US Airways' labor costs have averaged nearly 40% of revenues, compared with 31% at other airlines, according to AirlineForecasts, an investment research firm.

It's not for lack of effort. US Airways has cut 18,198 of 46,579 jobs, replaced big, expensive planes with smaller jets, and jettisoned its pilots' pension program. Still, the airline lost money for two consecutive quarters this year, dropping $90 million in the third quarter alone. Like a damaged World War II bomber, US Airways is big, slow and vulnerable. And the fighter jets are closing in. Southwest is going to attack the Philadelphia "fortress" hub of US Airways, where it accounts for 65% of the flights and where it has kept out rivals by scheduling more flights of its own. "Southwest in Philadelphia may prove to be the straw that breaks US Airways' back," says Vaughn Cordle, CEO of AirlineForecasts.

If the ATSB helps United Airlines, a bankrupt legacy airline that in some ways is a big version of US Airways, the argument may get political. There are 62,174 jobs on the line, not to mention a lot of potential votes. United has spent the past year lining up political supporters around Washington, including Congressman Dennis Hastert, the House Speaker.

Surprisingly, United's decision to return to the federal trough is drawing flak within the industry. In a rare display of intra-airline bickering, Leo Mullin, the head of Delta Airlines and the industry's key lobbyist for government assistance since 9/11, said, "The ATSB should be limited to overseeing the outstanding loans. Then it should go out of business." Added Mullin, whose carrier did not apply to the ATSB for money: "Let the marketplace work." That's easy for him to say, since Delta will probably survive. Some other airlines flying today will not.