J. Randolph Babbitt

Lawmakers were shocked when it was revealed that an FAA supervisor for Southwest had allowed 47 planes to continue flying, even though the planes were due for inspections to check for cracking skins. The FAA fined Southwest $10.2 million for the infraction, and under congressional pressure, began inspecting all airlines for similar maintenance violations. Up until April 2009, the FAA appeared to be continuing its tough oversight role.

Employee Ownership

Babbitt has twice worked on high-profile negotiations to obtain employee ownership of struggling airline companies. In 1994, United Airlines parent company UAL Corp. had suffered three straight years of crippling losses that ranged from $1 billion to $50 million. The airline needed to decrease its labor costs as sales began to decline because of the success of discount airlines like Southwest. Through Babbitt at ALPA and the International Association of Machinists, UAL eventually agreed to give 55% ownership to the employees of United. In exchange, United employees agreed to wage cuts and changes in worker-hour rules.

In 2000 as a private consultant, Babbitt worked for employees of Aerolineas Argentinas, which was seeking a buyer after suffering heavy losses. Three of the airlines employees' unions hired Babbitt to help save the airline and their jobs.

Babbitt devised a plan in which the employees would help purchase their airline with the help of a partner. The employees negotiated with the German airline Lufthansa, Air France, and Air Malaysia; those attempts failed. But with the help of Babbitt, Aerolineas managed to convince its largest shareholder, Spain's state-owned government holding company, SEPI, to inject $600 million into Aerolineas, saving it from destruction. Spain's Marsan Group purchased Aerolineas in October 2001.

Feuds

While heading ALPA, Babbitt had a memorable run-in with a former airline executive, who is blamed for ending the 60-year-old Eastern Airlines. Frank Lorenzo headed Texas Air Corp., which owned Eastern and Continental airlines, among others. Lorenzo refused to negotiate with unions, and led two different airlines into bankruptcy, including Eastern in 1989. Eastern's employees went on strike, and the company that both Babbitt and his father worked at was forced to fold in 1991. Lorenzo stepped down in 1990 from Texas Air.

But in 1993, Lorenzo tried to re-enter the airline business by starting a boutique company called Friendship Airlines. Babbitt and ALPA adamantly opposed Lorenzo's attempt to get back into the airline business in any way. Before Lorenzo had even announced his decision, ALPA issued a press release urging the Department of Transportation to deny any request from Lorenzo to start an airline. The union called Lorenzo "the very embodiment of evil." Then at a luncheon at the Aero Club in Washington, D.C., Lorenzo walked up to a table of pilot union leaders that included Babbitt, and said "I thought I smelled something." Lorenzo claimed it was a joke, but the hostility continued. Lorenzo was denied a government operating license in 1994.

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