Legislative relations may not enjoy top-of-mind awareness among most travel agents, but they are of critical importance—especially in the midst of an economic downturn. This was driven home to me during a recent talk with Paul Ruden, ASTA’s senior vice president of legal and industry affairs. Ruden, along with a few other colleagues, represents the thin red line of defense for travel agents.
Ruden himself is a 30-year veteran of ASTA’s battles with the Airlines Reporting Corporation (ARC), antitrust laws and the airline industry. He is also one of the most knowledgeable and influential defenders agents have. A graduate of Yale and Harvard, Ruden has battled debt memos, commission cuts and unfair taxation for three contentious decades.
As ASTA’s legal counsel and staff advocate, he has testified before Congress a score of times and defended agents’ interests before federal agencies such as the Department of Transportation. In Ruden, travel agents have found a skilled champion who has done much to shape the agency distribution system and the travel industry.
To Ruden, building awareness of the importance of what goes on in the White House, in both houses of Congress, and federal regulatory agencies is critical to all agents—from the giant travel management firms to small and mid-sized retail agents and to home-based independents. And this means vigilance and the ability to combat punitive legislation or taxation.
His briefing ranged far and wide: From the impact of President Obama’s stimulus package to the effects of the recession on small businesses and agents. One central theme was Ruden’s belief that the current downturn will change how travel agents and the travel industry operate— and how it will change ASTA. Ruden reports that ASTA is enjoying solid gains in membership among Core and Premium membership categories, as well as international membership.
ASTA, Ruden says, has a critical role in helping travel agents survive the current crisis as they have other disasters, such as the 1995 airline commission caps and cuts and the downturn after the September 11 attacks. One planned response is a half-day webinar in May that will focus on showing agents how to survive the recession, guide them through the resources they have available such as Small Business Administration loans, and what agents can do when the recession ends.
The planned webinar will include industry experts to brief participants. This will target ASTA Core members and follows a successful meeting for Premium members recently held in San Francisco. The Obama stimulus package has solid tax provision that agents could benefit from, Ruden notes. Ruden along with Bill Maloney, ASTA’s CEO and Chris Russo, ASTA’s president and chair wants agents to be aware of the resources and expertise ASTA offers to members.
“We simply don’t know how long the downturn will last, but it will end and agents must know their options and opportunities," Ruden said. "Part of ASTA’s job is to show them what is available.”
Ruden sees travel agency owners and mangers as tough, resilient and knowledgeable and he is wary of forecasts of doom. “Agents once felt threatened by the Internet, for example, yet today they have embraced it and are using it very effectively,” he said. “The current crisis is difficult in part because it is unpredictable. Where do managers invest or find capital for investment? How do agents deal with personnel shortfalls or determine optimum technology and marketing programs? How do they cope with new tax policies?”
Ruden notes the strengths of the agency community. He notes that agents were threatened by airline commission cuts, yet today they use service charges and fees to compensate. Agents have embraced cruise, tour and group sales and opened new market niches. They have also embraced new technology tools and targeted marketing. Client service standards remain high. And professionalism—represented by the CTC, MCC and CTIE designations— along with a variety of supplier, consortia and host agency training programs is laudable.
Ruden predicts that the travel industry and travel agents will have to pay more attention to what goes on in Washington—and equally demanding—what goes on in state capitals. From Secure Flight to passport rules and TSA policies, issues will multiply. To help, ASTA will work closely with other associations. Recently, 37 groups representing 82,000 businesses cooperated on developing a broad travel economic agenda for the Obama Administration—a hopeful sign that the traditional fragmentation of the industry will be tempered.
He affirmed that ASTA will continue to work with major agency groups, noting that the ASTA Corporate Advisory Council (CAC) has grown from 17 to 28 members, giving the agency industry more clout and a pool of talented and experienced leaders. Currently, ASTA is working closely with the Interactive Travel Services Association (ITSA) opposing antitrust immunity for the airline’s STAR Alliance. ASTA has also formed new ties with the World Travel Agents Association (WTAA). ASTA also has a strong Chapter network that can provide grassroots support on issues.
“I like to see ASTA as a learning organization who listens to its diverse and often conflicted membership base and who represents the industry with skill," Ruden said. "My hope is that the current economic downturn might encourage greater communication, consensus and cooperation in the industry and a cohesive effort -including grass roots support—to be heard in Washington.”
For ASTA and Ruden, building agency and agents awareness of the importance of legislative and government relations won’t be easy. But given the current economy, rapid changes in government investment and tax policies, effective representation will be needed if agents are to prosper.