Many of us will always remember the “too big to fail” argument that was used to protect some major financial institutions from going under during the financial crisis of 2008. It was popularized in a book by that title by Andrew Ross Sorkin and later was made into a movie. Basically, the argument is that the government can’t allow certain major institutions to go under because they are so interwoven into the American economy that their failure will cause devastating ripple effects throughout the economy. While small companies can be allowed to suffer the consequences of their bad economic decisions—like taking on too much risk, which causes them to go belly up—the government will intervene to bail out those that are deemed “too big to fail,” no matter their culpability. The “too big to fail” policy is one that many believe allowed those most responsible for the financial crisis to escape accountability.
With that in mind, I have to admit that reading the latest DOT Office of Inspector General’s report on the FAA’s oversight of Southwest Airlines made my blood boil. For many reasons. For one, the report highlights an issue that has been percolating in aviation circles for as long as I can remember. Is there a different law for big carriers versus small carriers? In other words, are similar regulatory violations at the major carriers enforced differently by the FAA than they are against smaller airlines, especially Part 135 operators? And most especially when it comes to emergency revocation of Part 135 air carrier certificates? Is there such a thing as “too big to revoke” in the aviation industry?