Pacific Solutions

Only four days after he took office, President Richard Nixon joined one of the biggest and angriest dogfights in airline history. He abruptly canceled a December decision by Lyndon Johnson that had supposedly settled for good a four-year contest for the first new transpacific air routes to be parceled out in 20 years. Johnson's awards, to six of 18 competing airlines, had left Washington seething with charges of high-altitude politicking and string pulling by "rainmakers," the cocktail-circuit term for former L.B.J. aides who had found lucrative jobs with some of the lines. Nixon promised a new decision "on the merits"; yet he too faced the problem of adjudicating the conflict on terms that would not invite similar charges of political favoritism.

Last week, at a surprise press conference held after the stock exchanges had closed for the weekend, the Nixon Administration deftly solved the quandary. First, the White House conceded that a study of the Johnson decision had turned up "no evidence of impropriety." On scrupulously economic grounds, the Nixon formula nevertheless sharply pared Johnson's largesse and excised entirely those awards that had fed the cries of cronyism.

Not everyone suffered cutbacks. TWA came out unscathed. It will be granted new runs to Hong Kong and Guam, linking with existing trans-Asian routes, and will thus become the U.S.'s second round-the-world carrier (after Pan Am). Flying Tiger's all-cargo service to Japan remained intact. The two established U.S. airlines in the Pacific, Pan Am and Northwest, came in for minor rejiggering. Pan Am lost a great-circle route to Tokyo from Seattle and Portland but kept a new run to Japan from New York. Nixon denied Northwest a great-circle route to Tokyo from California, but allowed its new central Pacific route to Japan through Hawaii to stand.

Conspicuous Losers. The big losers were Lyndon Johnson's most conspicuous winners. Houston-based Braniff, which has strong ties to the old Administration, lost a stopover in Mexico, although it retains several new runs to Hawaii which, as domestic routes, are not subject to presidential review. Under the Johnson decision, Los Angeles-based Continental Airlines stood to grow from the eleventh biggest U.S. trunk line into a sizable international carrier serving such South Pacific spots as Samoa, Australia and New Zealand. Continental's President Bob Six had served the previous Administration by providing extensive--if not always clearly defined--services in Southeast Asia. The line has at various times employed such Democratic stalwarts as Lloyd Hand, Pierre Salinger and Clark Clif ford's law firm. Nixon ordered all of Continental's awards canceled or deferred, partly on grounds that the CAB should authorize direct service to the South Pacific from points in the East and Midwest. That could open new horizons for financially ailing Eastern Air Lines, whose Pacific ambitions were endorsed by a CAB examiner but ignored by Johnson.

Nixon based his revisions on studies by Assistant Transportation Secretary Paul Cherington, a onetime Harvard professor, showing that CAB transpacific traffic forecasts had run from 21% to 33% too high. A surfeit of U.S. airline traffic, goes the Administration's rationale, would only prompt reprisals from countries anxious to protect their own airlines. Were Japan Air Lines to suffer from increased U.S. competition, for example, Tokyo could well dun Washington for more flights to the U.S.

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