Air traffic jam

TEXT OF STORY

SCOTT JAGOW: The world's airlines thought this might be the year of progress, of making the hole smaller. But the industry's trade group says with fuel prices the way they are, you can pretty much chalk up another $3 billion in losses. Airlines lost $3.2 billion last year. Fuel costs are expected to eat up more than a quarter of the airlines' budgets this year.

The nation's 14,000 air traffic controllers are arguing with their employer, The Federal Aviation Administration. Today's the deadline for Congress to decide if it should get involved in this. Alisa Roth has more.

ALISA ROTH: Nobody expects a repeat of 1981.

[ President Ronald Reagan in 1981: If they do not report for work within 48 hours, they have forfeited their jobs and will be terminated. ]

That's when Ronald Reagan fired 11,000 air traffic controllers for walking off the job.

But the FAA says it can't afford salaries that average above $100,000 a year. It needs the cash to upgrade the air traffic control system.

The controllers say they might as well retire, the new contract pays so little.

Industry consultant Hans Weber says the FAA is finally catching up with the times.

HANS WEBER: Here we're seeing the painful adjustment in the public sector that the private sector has gone through to a much larger extent over the last 4-5 years.

If Congress does nothing, the FAA's last offer automatically takes effect. That's a two-tiered plan, which pays new hires less.

In New York, I'm Alisa Roth for Marketplace.

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