Mr. Chairman, the airline industry is going in the wrong direction. The region likely to suffer first, and the most, is the East Coast, which includes a lot of states with two Senators each, including a wonderful state called Vermont.

As I have pointed out in the past, control of landing and takeoff slots and control of gates by just two major airlines – United and American -- can become a stranglehold on competition on the East Coast.

I updated a chart which I used during our June hearing. Now, the situation has just gotten worse.

As you can see, the cost of a roundtrip ticket to Burlington, Vermont, is $772 – whereas similar advance-purchase roundtrip tickets to London are $338, and a trip to San Francisco costs $408.

If the airline mergers on the table are approved, two major carriers will control more than half the air traffic in the U.S. and will offer ticket prices based on what the market can bear – using monopoly slots, rather than providing low-cost service.

Landing slots, like the spectrum which carries television shows and wireless phone calls, have become a priceless commodity even though both are nothing more than the use of space, for a period of time.

From a more national perspective, these mergers will put us one merger away from an oligopoly of three major carriers.

Higher airfares and reduced competition will follow unless significant divestitures of slots, gates and other assets are mandated.

The industry will also be one work stoppage away from closing down one-fourth to one-third of America’s air system. This prospect has become even more frightening with potential labor strikes at four major airlines (Delta, American, Northwest, United).

The American purchase of bankrupt TWA does not present serious competition issues, by itself, and is needed to protect 20,000 jobs. I know that Senator Carnahan has worked diligently to help keep these current TWA jobs in Missouri.

However, the United merger with U.S. Air and the slots which American will receive, coupled with the next "defensive" merger – Delta with either Continental or Northwest -- down the pike, will mean that over 75 percent of airline service is from only three large airlines with large hubs, lots of slots and gates, alliances with overseas carriers and frequent flyer deals galore.

Proponents of the mergers say that consumers will benefit from wider networks and seamless connections. But when Vermonters call or write me about air service, they don’t talk about networks or connections, they tell me that prices are too high, service is poor, and that they do not have enough choices.

With the proposed merger, I don’t see how this situation will improve in Vermont or in hundreds of other cities across the country. In fact, I’m afraid it can only get worse – and the worst of it will be on the East Coast.

In many cases, it’s already an uphill battle for low-cost carriers to break into new markets. We need to get more slots to JetBlue, Southwest and AirTran, and other low-cost carriers, to increase real competition.

After this round of mergers, it might be like trying to scale Mt. Everest for a new carrier to break into the market.

This is especially true in rural America.

Mr. Chairman, if the United merger is approved without conditions it will upset the delicate balance that has allowed more Americans to fly at a lower cost. If we don’t tread carefully re-regulation will be around the corner with all its inefficiencies.

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