THE INTERVIEW: COLONEL FRANK BORMAN!

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Colonel Frank Borman is an American Legend. Born in Gary, Indiana on March 14, 1928 his family later moved to Tucson, Arizona. A romance with airplanes at the age of 15 led to a career as an Air Force officer from 1950 to 1970. During that period, Borman earned his Bachelor's and Master's degrees in Science and Aeronautical Engineering, and worked as a test pilot and an Assistant Professor of Thermodynamics and Fluid Mechanics at West Point Military Academy. He was tapped by NASA (National Aeronautics and Space Administration) during the Administration of President Kennedy to help pilot the then-fledgling space exploration program. In 1965, Borman served as Commander of Gemini 7--the first-ever space rendevoux with Gemini 6A. Two years later, his leadership proved invaluable as one of the investigators of the tragic Apollo 1 launch pad fire that killed astronauts Virgil "Gus" Grissom, Roger Chaffee, and Ed White. Frank Borman led the team responsible for the exhaustive redesign of the Apollo spacecraft and its safety systems. On Christmas Eve, 1968 Borman made history as the Commander of Apollo 8--the first manned lunar orbital mission. The television broadcast from Apollo 8's spacecraft hear throughout the world that night saw Borman and his colleagues Bill Lovell and Jim Anders alternately reading from the Book of Genesis in an emotional "Good Night" to "the people of the Good Earth".

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The following year, while serving Eastern Air Lines as a Special Advisor, then President Richard Nixon selected Borman to serve as a special Presidential Ambassador to help seek support throughout the world for the release of American Prisoners of War held by North Vietnam. By December 1970 he returned to Eastern after retiring from NASA and became Vice President-Operations Group. By July, 1974 Borman became Vice President of General Operations and in December, 1975 he became Chairman of the Board, President and CEO charged with turning around the failing carrier. With Borman at the helm, the first-ever Variable Earnings Plan for employees began. From 1976-1980 the airline achieved record profits and expanded to Latin America after purchasing bankrupt Braniff International's route system, establishing a Kansas City Hub and embarking upon a fleet modernization plan. Frank Borman retired from the airline industry in 1986 and moved from Miami to Las Cruces, New Mexico where I became the first American journalist to be granted an interview in 16 years! Following are excerpts from my meeting that occurred just two days before 9/11. Of my original four mentors in life, Frank is the only survivor. Today, he is CEO of Patlex Corporation, a company engaged in enforcing and exploiting laser-related patents. Married to his high school sweetheart Susan, The Bormans are proud parents of two grown sons and four grandchildren.

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MM: So many times when I travel and I'm in the airport somewhere in America awaiting my flight, I'll notice someone watching a jet push-back using reverse thrust with no tug and I'll say to them, "Do you know who pioneered that procedure?"

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Borman: (smiling) Eastern Air Lines.

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MM: ...and I'd say "Colonel Frank Borman at Eastern Air Lines". Colonel what have you been up to in recent years?

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Borman: I'm with a small company that owns patents on lasers, and we collect royalties from people that manufacture lasers.

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MM: You knew Eddie Rickenbacker and Charles Lindbergh. Tell me about Captain Eddie (founder of Eastern Air Lines).

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Borman: I met him, yes, several times. But at the time I met him, he was really quite old. He was no longer associated with Eastern. He was kind of bitter when I (first) met him. I remember one night, I sat at a dinner between him and Arthur Godfrey (early aviator and Radio/TV Entertainer), and they both were really sort of bitter about the way the world was going, how the U.S. was going, and it was kind of sad in a way. They had lost their optimism.

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MM: You knew Charles Lindbergh as well.

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Borman: Yes I knew him...

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MM: I believe he and his wife actually watched your launch of Apollo 8?

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Borman: They did. The day before they came down we had lunch with them. They watched the flight. President Johnson had a dinner and we all went to it. And then President Nixon appointed me to an environmental committee, and we traveled a lot together and so I got to know him pretty well.

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MM: What are your recollections of Lindbergh?

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Borman: One time we were in San Francisco going through the Bay Area Rapid Transit plans, taking a ride on it before the public did. As we were coming out of the station, there was a lot of clamor for autographs from people. So of course I did it. But he refused. And when I got on the bus with him, he said, "You know, I really admire you for being able to do that. I just can't bring myself to do it". He was, I think a very shy person. Very, very nice guy. And I don't think he was being reclusive in not signing autographs, he just wasn't comfortable in that kind of situation.

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MM: You mention the Honor Code at West Point in your book as being responsible for establishing and guiding the principles and priorities in your life. With this in mind, what are your observations about leadership in the airline industry today?

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Borman: It's very difficult for me to comment on the leadership today because I'm out of touch with it. But I do think that the industry as a whole has an enormous problem. Because of the scales of trying to run the modern airline industry under the Railway Labor Act that was enacted in 1926 for railroads, I think it's almost an impossible task. And people say. 'Well the salaries you're paying the pilots are too high'. I don't think that at all. I think that the salaries under our system are whatever people can negotiate. Unfortunately, I don't think that the airline management today has the capability of constraining or moderating salary requests. And I don't think the unions should. The unions in representing their people are going to try and get the best deal they can get. And too often that means the most they can get without looking into the future. I think that you're asking an awful lot of a union leader to assume the role of the moderator when that's really got to be a management chore. So it seems to me that the scales are terribly unbalanced, because I don't know of an airline that could take a strike. But I don't know what the answer is today for the airline industry in the future. I suspect it's going to be boom and bust. Probably the only way they can surmount this obstacle is to somehow tie salaries to profits, which we did with the Variable Earnings Program (predecessor to the programs in effect at Southwest and Continental Airlines). That makes some kind of sense. But that takes understanding on the part of union leadership.

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MM: What are your observations on the Airbus A380 double-deck wide-body versus Boeing's proposed aircraft designs?

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Borman: I think Boeing is on the better track. In the first place from the standpoint of just ground facilities, I have a difficult time understanding how they are going to handle that huge airplane. Boeing will be able to get more frequent flights to smaller destinations. They may be important for areas like Australia or Singapore. And I don't know the ASM's (Available Seat Mile) costs of any of these airplanes. I imagine that they must have ASM costs that are quite a bit smaller than the Sonic Cruiser (still on the shelf at Boeing). But that would be their only advantage in having a huge airplane (555-800 seats). I just think that would be a hard sell.

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MM: The Airbus argument is that we need fewer 737's and 757's clogging up the airport runways and this would provide a solution. But they're also taking away a lot of frequencies.

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Borman: Not only that. We need more runways rather than fewer airplanes, it seems to me. That's another thing. I fly a lot. (Borman pilots his own aircraft three times a week in addition to instructing Air Force Pilots). I use the air traffic control system. It's far better than it was in the Eighties. But it's clear you can't over-schedule the way they're doing it.

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MM: What are your view on deregulation?

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Borman: I think deregulation is wonderful. But I do think that one of the things Dr. (Alfred) Kahn didn't foresee, the price of entry now is impossible. And I don't think the established carriers have the resources to take a strike. So there's no balance between the two forces--if you will--between management and labor. And I could see that if there was enough sense to negotiate salaries related to profits or some sort of a new law ---for instance the Mutual Aid Pact there would be some sort of semblance. (Before President Carter deregulated the airline industry in 1978, the Mutual Aid Pact reimbursed grounded airlines hit by a strike with the funds acquired by passengers flying the remaining airlines to allow the affected airline the chance to rebound from a strike with new agreements while retaining employees). Eastern was the first one to get out of the Mutual Aid Pact because I wanted a relationship to preclude ever having a strike. But I don't see a light at the end of the tunnel. I think it's going to be a roller coaster of a boom-and-bust.

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MM: How do we fix the Air Traffic Control System from top-to-bottom?

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Borman: I think the problem is not so much electronics, it's the airports. I agree with Herb Kelleher (Chairman of Southwest Airlines). "Runways, runways, runways. It's the airports, stupid!" And I think that's Boeing's plan about utilizing GPS more effectively. This makes a lot of sense. But that doesn't make a bit of difference if you've got airlines at LaGuardia (in New York) scheduling 90 airplanes out in a 60-minute period. I took off one time at LaGuardia. We were number 24 in line. It's crazy.

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MM: The merger deal between United and US Airways (in 2000) failed. The Business Travel Coalition came out with the statement that the competitive structure of the U.S, Aviation industry would be "inalterably changed for the worse, putting airline deregulation at risk if this merger were allowed to take place".

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Borman: I agree with them. I don't think that should have been allowed to take place. I think that the big ones are too big for the market. I would not have even allowed American to take over TWA. I think that you really simply have to say, "Okay this is too many and too much". In the airline business, the economy of scale allows you to control markets. Because if you had fifty airplanes or one airplane, they're not more efficient. In other words, you may be able to schedule crews a little better and so on as you get bigger, but there's also a point where you get too big.

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MM: American and British Airways want to merge in the worst way (this remains true today).

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Borman: I wouldn't allow that either.

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MM: You feel that re-regulation is not the answer?

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Borman: No.

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MM: But hasn't deregulation failed?

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Borman: The basic problem in my estimation has been the lack of people's ability to enter the market. And now that the other carriers are so big, I mean, face it...except for the threat of government action, Delta (now in Chapter 11 bankruptcy) could squash AirTran. And they may be able still to control their growth so that AirTran doesn't have much of a future. The last thing in the world that I would do is to invest in a start-up airline. Forget it.

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MM: If you look back at your career path from the military academy to the airline industry to private enterprise today, what are your proudest achievements within each area?

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Borman: I think the proudest achievement while I was at NASA was that I played a role in helping us beat the Soviets to the Moon. That was very important. We had a mission there, and everything was oriented to doing the mission. It was a wonderful place to be because we had talented people. We had Chris Kraft (NASA's Director of Flight Operations), (Dr. Werner) von Braun [acknowledged 'Father of Space Travel'], (Robert) Gilruth (Director of the Manned Spacecraft Center), who were talented and completely oriented to this. At Eastern (Air Lines) I was really proud of the fact that we were able to resurrect what was a dying airline and make a go of it. It was a severe disappointment when we had to sell out. But I still think that we gave it the very best that we could, and I'm arrogant enough to think that nobody, no management team could have done any better. And since then, I've just been a happy grandfather.

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MM: Do you miss the airline industry at all?

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Borman: No, I've never looked back. When I left the Air Force for NASA, I loved the Air Force. I still love the Air Force. But I don't think you can keep one foot on the beach and one on the boat. You either get on the boat or stay on the beach. So, when I left for NASA, I stayed with NASA. I've only been back for one launch since I left NASA. And with the airline industry, when I left, I left. God Bless Them. I think it's an exciting industry with wonderful people. But it's operating under archaic laws and the playing field isn't balanced.

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Note: I deliberately edited what was originally a 90-minute interview followed by a walk around visit with Colonel Borman of his personal airplane hangar, desktop model collection and later an informal visit over hamburgers. Frank is today 79 and still very engaged in his various businesses. He waves off the "stardom" of having appeared on magazine covers even his being nominated as a Congressional candidate (which he declined). Frank remains one of the most "down to earth" personalities I've had the privilege of meeting and I thoroughly enjoyed our visit.

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Aftermath: Since my interview, US Airways defied the critics and managed to survive by merging with America West; TWA met a truly tragic end after it was acquired by American Airlines. Despite many public promises to retain what remained of TWA's 26,500 employees, 87% of the TWA employees were permanently fired and most of what American bought from TWA it liquidated. In fact, only 500 former TWA pilots are flying with American Airlines today! Quite an embarrassing debacle! This purchase was a knee-jerk reaction by American to the then-proposed merger of United Airlines with US Airways that would have made United the largest airline in the world. Unwilling to accept this, American became the only suitor willing to salvage a crippled TWA on the condition that TWA first file a Chapter 11 bankruptcy. This allowed AA to "cherry-pick" only the assets that it wanted from Trans World Airlines. The Department of Justice denied the United/US Airways merger on anti-trust grounds. So, American was stuck with what now appeared to be the most ridiculous waste of money ever. American's plan to develop TWA's hub at St. Louis International Airport into a Mid-West hub was another embrassment. In the aftermath of 9/11, American disposed of TWA's fleet of 29 aging DC-9's and all even some of the much-newer Boeing 757's and 767's. All of the MD-80's were retained. No improvements to St. Louis International Airport was ever undertaken. In fact, Terminal D today sits totally abandoned.

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TWA's demise began in 1983 when TWA Corporation spun off the airline operations from the Westin Hotel chain, Hertz Rental Car Corporation and even a gaming machine company. Left vulnerable and weak, in 1985 (with the beginning of terrorism in the USA) TWA became involved in a brutal bidding war between two notorious corporate raiders: Frank Lorenzo and Carl Icahn. When Icahn won control of TWA, it's "Crown Jewel" routes to England and many other International destinations were sold off for cash as quickly as Icahn possibly could to recoup twice his original investment. Unfortunately, none of the proceeds were reinvested into TWA. To make matters worse, Icahn took TWA private, thereby making it impossible for TWA to ever turn a profit. By 1992, Icahn placed TWA in Chapter 11 bankruptcy and resigned in 1993. TWA emerged from it's first visit to Chapter 11 financially weaker and corporate strife followed. This, among other factors led to a second (pre-packaged Chapter 11 filing in 1995) I interviewed a beleagured Jeff Erickson, then-TWA's CEO on both occasions. Soon after my second in-person interview Erickson was ousted by TWA's board of directors.

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Prior to American Arlines entering the picture, TWA finally gained a very competent CEO named Joe Compton. Compton started as a pilot with the company in 1968, became president of its pilot union and later became a member of TWA's board of directors. Under Compton's leadership, TWA which now had the oldest fleet in America began to order new planes. The employees rallied time and again to save the company and eventually TWA became "the best airline in America" in 2000, garnering the prestigious J.D. Powers Award for service excellence as a favorite among business travelers. As time went on, it became clear to TWA's management that with it's International Route System stripped to little more than a handful of destinations, and financially weak after the explosion of TWA Flight 800 over New York (still unsolved), it required a merger partner. None was forthcoming, despite a flirtatious negotiation with Russia-based Trans Aero. A merger with American Airlines seemed to offer some light at the end of a long, dark tunnel. But it was not to be. Conditions in the post 9/11 world simply made the merger a nightmare for AMR, American's parent organization.

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Donald Carty, American Airline's CEO was forced to resign in disgrace after it was revealed publicly that he had secretly approved generous bonuses for AA's top executives while forcing AA employees to surrender massive pay cuts. While the TWA absorption made AA the world's largest carrier, the merger was a disaster for both companies. This lends significant credence to Colonel Borman's views on mergers in today's disastrous deregulated airline industry environment.

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