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2017 Competitive Enterprise Dinner Keynote: Elaine Chao

The following is an excerpt from remarks delivered by U.S. Secretary of Transportation Elaine Chao at CEI’s Annual Dinner & Reception held on June 7, 2017. The theme of the event was "Through the Looking Glass."

Thank you so much. When I was first in Washington, the President of CEI was Fred Smith. And I just saw him over there. I’m going to give a great shout out to Fred Smith. And I’m so excited to meet the new president, Kent Lassman. He is so inspiring. So full of energy. Kent thank you so much for what you so. And also I’m so excited to meet tonight’s awardee Pierre Desrochers.

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In Lewis Carroll’s beloved tail, Alice wonders what life is like on the other side of the mirror, above the fireplace. And she steps through to find everything familiar, but also strange, new, and illogical. Now most of us came to Washington by road, train, or airplane. Not through a mirror or rabbit hole. But for so many, Washington is kind of like a wonderland that is different from the real world outside the Beltway.

And just like Alice, a recurring problem in Washington is right-sizing. Alice tried shrinking herself, and then she tried to get bigger. Both times, she ran into problems. In Washington, all too often the default situation to every challenge has been to get bigger―to grow government. Well, this administration is taking a fresh approach. It is looking for opportunities to right-size the delivery of services in order to produce better results for the taxpayer. Can you imagine? And so, let me share three examples about how right-sizing can actually yield major benefits for taxpayers, for the citizens of our country, for our country overall.

This past Monday, the President announced a transformational initiative to reform our country’s air traffic control system. Now the case for reform is clear. How many of us have been stuck at airports? How many of us have been late for some important meeting, or perhaps, for just getting home?  Every American has had encounters of delays and congestion and by 2020, over one billion passengers will be flying through the air.

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The problem is the congestion and delays caused by an antiquated air traffic control system. Air traffic controllers today, in America, still use paper strips to keep track of incoming and outgoing flights. And pilots rely on a system that’s based on 1960s technology. And the delays are causing more than $25 billion a year in operating costs and wasted time.

So the new air traffic control structure proposed by the President will enhance safety, protect our national security, ensure state of the art air traffic control technology that is secure, robust, and resilient, maintain access for all users of the airspace, especially those in general aviation and rural communities, ensure financial self-sufficiency through user fees, and independent access to the public markets.

Right now there’s over $5 billion in aviation trust fund dollars that’s not appropriated and just sitting there. And then this entity that will be separated, air traffic control, will be governed by a professional board of directors that includes all stakeholders, such as general aviation, airports, airlines, etc. And no one group will form a majority. And the fiduciary responsibility will be to ensure the safety, the health, and the efficiency of this air traffic control system.

So this administration is proposing to separate the operations of our country’s air traffic control system from the safety oversight of the FAA. Air traffic control operations will be split, will be moved to a non-governmental independent, non-profit cooperative. The FAA will retain its safety oversight functions and will remain at the Department of Transportation.

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Now some critics will say, ‘why are we doing this now? And so quickly?’ Well discussion and proposed bills to separate air traffic control from the FAA has been talked about for over 30 years. And today the need is more imperative than ever before as the rate of technology accelerates. And we need to equip the air traffic controllers with the most modern, the best equipment, so that they can keep our skies the safest going forward into the future.

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And I want to commend CEI, because CEI has been a leader in recognizing the seminal issue of this very important development, and you guys came out early as a strong supporter of air traffic control reforms. So thank you. Once again, CEI is ahead of the curve and a leader.

Now the second issue I want to talk to about with right-sizing is government regulations. This week, the administration is convening a series of events to highlight the need to reform the permitting process for building public infrastructure. In the 1930s, it took 4 years to build the Hoover Dam. 4 years. The Hoover Dam is one of the most spectacular infrastructure projects of the 20th century. 4 years. That’s all it took to build it.

Today it takes longer―sometimes decades―to get a highway, a regular bridge, or a few miles of Metrorail built, because of the delays caused by government permitting and regulatory processes. These delays also add billions of dollars in extra costs to building infrastructure.

So a major part to the President’s infrastructure proposal will be common sense regulatory permitting and process reform. And streamlining the regulatory process will not only cut costs, it will improve environmental outcomes by delivering infrastructure improvements more quickly. Resources will be spent on actual environmental mitigation, rather than stacks of paperwork.

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So whether it’s fixing the air traffic control system, or regulatory reform, I think we can take a page from Alice and find the right size to get the job done better by introducing common sense, market-based reforms. We can enhance safety, fix our crumbling infrastructure, and create a better quality of life for our hardworking, American people. It’s an important lesson, and one that Washington should be able to learn without falling down the rabbit hole.

Watch Secretary Chao's full remarks below: