Based on some of the comments below I'm not sure writers have actually read the study, which I commissioned with colleagues at Taxpayers for Common Sense, the Reason Foundation and the American Bus Association. I thinks it's a pretty good model for more such analysis, and interesting in part due to the dearth of assessments without one of two polar opposite punch lines ("Let's slash this" or "Don't touch this").

First of all, we don't propose simply eliminating the whole program (although I know some of us believe that's advisable). We took a subset of communities that could benefit from service from a cheaper, cleaner alternative mode -- 38 of the possible 152. We stuck with the lower 48 states, and looked only at those that are less than 150 miles from one another. The purpose of the study was to examine an alternative way of linking communities into the transportation network, not cut them off, in order to save money and reduce pollution.

Second -- and this is a tribute to the consultant -- we wanted to do a solid job of quantifying cost differentials, including time (whether spent with TSA officials or on the road), as well as energy and emissions contrasts. The study accomplishes this credibly, and buses (whether large ones or smaller shuttles) fare well in the comparisons, with some notable variations in performance depending on the city pair in question.

And third, we don't claim that this is the end-all and be-all of subsidy studies. There is ample room for more of this kind of analysis comparing modes that make up, or that could make up, our national transportation network. I hope they will do so as carefully as this study, namely by going beyond costs to examine energy and emissions, and by seeking to provide similar mobility benefits for consumers.

This is the kind of information-rich analysis we need at a time when federal investments should be questioned skeptically due to huge fiscal constraints while keeping in mind that drastic cutbacks in federal support could harm the economy.

From a performance perspective, we are definitely not getting the best possible national benefits from our current EAS subsidies. The EAS program is inefficient- it is very difficult to argue that air transportation is the most cost-effective mode of providing rural-hub airport connections given other ground alternatives, particularly in routes with very few daily passengers and/or low load-factors, as explained in the posts above. A better approach would be to provide mode-neutral funding - subsidies for any mode - for improved access to qualifying rural areas on a competitive basis. This would allow for innovation and potentially improve access by not confining grantees to using airplanes.

But looking at the bigger picture, how much money would we save by eliminating EAS or replacing planes with buses? The annual $200 million spent on EAS represents only about 1.25% of the FAA’s FY 2011 budget, and an even smaller, minuscule share of the overall federal budget. EAS funding is very small compared to other programs funded by the airport and airway trust fund, such as the multi-billion dollar NextGen modernization program. Yet it is being used as one of the policy issues to hold up the long-term FAA reauthorization bill, and together with it the fate of NextGen. In politics, as in life, we must pick our battles. We should not continue to allow this minor expenditure, that many in Congress will fight strongly to protect, to hold up long-term legislation.

Here is a comment from Brian Sowa, Executive Director of the Rural Air Service Alliance:

In the halls of Congress, Rural America has always been fighting for its life – fighting to ensure that Dallas, South Dakota is able to compete with Dallas, Texas for its fair share of federal taxpayer dollars. This fight is waged across all sectors of industry, from small, rural hospitals vs. large urban medical centers to family farmers vs. international agribusiness interests; and here we go again with predominately urban bus systems vs. small air carriers and airports serving rural communities.

Many of those launching the most recent attack against the Essential Air Service (EAS) program will say this characterization of rural vs. urban misses the mark entirely; that they are simply sick and tired of paying the bill for yet another “temporary” federal program that doles out millions of dollars with very little tangible benefit to them. Point noted. The rural air service community has long advocated for reforming the EAS program to ensure communities truly build a path toward self-sufficiency when possible, and short of that find creative solutions to bring down per-passenger subsidies and make the program as efficient as possible. Such common sense reforms must be part of the next FAA reauthorization bill.

But a program that provides a legitimate economic lifeline to so many communities -- and one that is funded entirely from internal user fees rather than general tax revenue -- should not be blindly eliminated or defunded to the point of being effectively useless. At the end of the day, these small rural airports and the commercial air service they offer provider a tangible economic driver for their rural communities, something subsidized bus service can not provide. Furthermore, we must be willing to shine the same bright light on the BILLION DOLLAR programs serving urban interests year after year without any real oversight or inspection for those three dirty words of waste, fraud and abuse. Those criticizing EAS without also demanding the same accountability for programs serving urban interests are proving our point – this is an urban vs. rural thing.

But Rural America is accustomed to this double standard. They don’t have as many lobbyists, grant writers, economic developers, teachers, fire fighters and police officers. Rural America has always done more with less. This pioneering spirit is invoked with great patriotism and nostalgia when convenient to bolster our better nature in times of trouble; but the truth is that rural communities need a level playing field if they are to survive and fairly influence our national discourse on key issues and challenges. The Founders realized this, and the result is our bicameral legislature and the Electoral College.

By its very Constitutional nature of allocating seats based on population, the House of Representatives is dominated by Members from urban/suburban districts. To the contrary, in the U.S. Senate Wyoming and Montana enjoy every bit of influence as that of New York and California. This arrangement ensures that urban population centers do not dominate our public discourse and the resultant public policy. Similarly, our electoral system of electing a President ensures that New York City, Los Angeles, Chicago, Boston, and Philadelphia do not appoint our Commander In Chief absent the views of Smalltown, USA (just ask Mr. Gore).

And thus, we have come full circle to the ultimate paradox for conservatives: providing a megaphone for Rural America is a great thing in Presidential elections, but not so good in federal budget crafting. Yes, we must ensure that every federal program passes the laugh test for practicality and efficiency – even ones like EAS that derive their funding from internal user fees rather than general taxpayer revenue. But we must also always ask ourselves the question of what greater waste we may create by using a budgetary chainsaw rather than even just a meat clever? Perhaps the answer lies somewhere in the great irony that in using the $200 million EAS program as a pawn in the recent shutdown of FAA operations, the federal government lost $350 million in air ticket receipts. At what point are we cutting off our nose to spite our face?

A just released report commissioned for the American Bus Association, Taxpayers for Common Sense, The Reason Foundation and the Natural Resources Defense Council believes scheduled service motorcoaches between smaller American cities to and from the larger regional airports is a better, more cost-effective way to safely move millions of people each year to their destinations.

Since 1978, the Department of Transportation’s Essential Air Service program has been in place. Our study showed at just 38 smaller airports, less than one-quarter of the total number of airports in the EAS program, that the Federal Government and society would save $90 million dollars by replacing heavily subsidized airline tickets on small airplanes with motorcoaches.

In some cases the EAS subsidies cost as much as $1,600 per passenger round trip.

This analysis indicates that the same number of scheduled weekly trips between these 38 rural airports and nearby regional hub airports could be provided by coach buses at a total annual operating cost of $33.9 million. When coach travel is longer than air travel, which is not always the case, and the "cost" of added time on the coach is considered, the motorcoach trip is still substantially less than air travel.

This report indicates that these routes could probably support bus service with no long-term government subsidy; in the long run savings to taxpayers could amount to $50 million or more annually because the cost to operate coach bus service is so much lower than the cost to operate aircraft.

The analysis also shows that using buses instead of aircraft to link these 38 communities to regional hub airports could reduce annual petroleum use by 5.7 million gallons, could reduce annual CO2 emissions by 63,500 tons, and could reduce other harmful air emissions of nitrogen oxides, hydrocarbons, carbon monoxide, and sulfur dioxide.

Funding at some EAS Airports still make sense. We support those airlines where the passenger loads, costs and distance from cities to airports make it viable. However, like many well-meaning government programs, EAS has grown every year and many of the routes that receive subsidies, often more than one million dollars a year, are questionable.

For example, Athens, Georgia to Atlanta. The distance between the two cities is seventy-two miles. 96 hundred passengers a year fly the planes or 27 people a day, that’s in the bottom third of total passengers in the 38 communities our research looked at.

Competing bus service runs along the route and the round trip ticket is less than $70.00. The average government subsidy per person is $109.20 per or $1,057 million a year.

Decatur, Illinois, right in the center of the state is another example.. The city is 120 miles from St. Louis and 157 miles from Chicago and flights go to both cities. The annual subsidy is $3,082 million. The total passenger count is just 12 people per day. The average subsidy per person is $627.53 and the annual subsidy is $3 million dollars.

I’ve pointed out the shortcomings of the EAS program and reasons why it needs to be cutback, now let me point out the numerous advantages of motorcoach travel. Each year the motorcoach takes nearly 750 million people to their destinations. We’re the safest and most economical form of transportation. As the Natural Resources Defense Council points out, motorcoaches are the “greenest” ways to travel. The average bus has 53 passengers and moves people using a fraction of the fuel in airplanes, trains and personal vehicles. Ticket prices for a round trip bus ride are a fraction of what it costs to fly and for distances between one and three hundred miles, the distance of most flights in the EAS program, buses compare favorably against airlines in terms of time.

The motorcoach industry has also spent hundreds of millions of dollars in recent years to upgrade its fleet with improved safety features, comfortable seats, restrooms, video systems and plug-ins. The buses on our nation’s highways now no longer resemble the ones people rode on just ten or 15 years ago.

At a time when our nation faces some very important fiscal decisions and our leaders are looking for ways to reduce spending, without damaging essential services, cutting the Essential Air Service producing only makes sense.

Decatur, Illinois, one of the cities where we pointed out, EAS spends millions of dollars a year, was once represented in the United States Senate by its neighbor Senator Everett Dirksen of nearby Pekin, Illinois. Mr. Dirksen’s most famous quote when it came to wasteful government spending is now truer than ever. “A billion here, a billion there and pretty soon you’re talking about real money.” In these tough economic times, Senator Dirksen’s words still ring very true.

Many providers of bus services pay federal taxes on their earnings. To use these revenues to subsidize competing air (and railroad) services makes no sense, except to the spenders in Washington DC who have brought the federal economy to its present condition.

You ask: “When should the federal government step in to make sure everyone has access to at least one long-distance travel option?” As the federal government has run out of money, is not one rational answer "As soon as it balances its budget"?

How about addressing the problem from the other side, and asking whether federal budgets should subsidize any transport services?

Subsidies for local services should surely be paid for locally. And, thanks to electronics, financially viable long-distance services, even roads, can be financed commercially, by public or private investment. Auctioning landing and take-off slots in congested airports could help to finance appropriate facility expansion.

And why should federal taxpayers be required to finance financially unviable transport services? In many countries, users finance all airports. In Canada, even air traffic control is privatized.

Plane subsidies vs. buses – are you kidding?

This week’s question is one of the world’s true no brainers.

Yes, bus service will take a bit longer than a flight – but that’s before figuring into the math the time to get through TSA security and the time required to get to the airport early to be sure that today is not the day there is some crisis which will cause you to miss the plane.

The nation decided, back in 1978, that it prefers lower prices on most flights to supporting an integrated pattern of equivalent service under the terms of which long haul flights subsidiz underutilized short haul flights in the name of ubiquitous service. While the public’s opinion is quite clear, politicians have refused to recognize that judgment. Instead, they have raised all sorts of nonsensical arguments to the effect that service to small airports somehow essential to the American dream and have perpetuated subsidies for those services. The reality is that subsidies for service to small and remote airports is nothing but a product of a political system that allows politicians from areas likely to lose service to steal from taxpayers unaware of what is happening and thus appeal to the desire of their constituents to have service they are unwilling to pay for.

There is no great policy decision required here. Simply withdraw support, and the public will immediately determine whether it wishes to pay more for airline service, or support a bus service, or simply drive private vehicles to the nearest major airport.

End of argument.