Travel agencies suffer after terrorist attacks

Things are anything but smooth sailing for people in the travel industry these days.

It has watched the airline industry ask for, and receive, a $15 billion bailout from the federal government. All the while, it has been reeling from its own financial hit from the Sept.11 terrorist attacks on

The American Society of Travel Agents (ASTA) is now speaking up.

Last week, it told a U.S. House panel that it, too, is facing almost certain financial ruin unless the government intervenes.

ASTA attorney Paul Ruden says the tragedy has left travel agencies "caught between the hammer and the anvil ... having been completely ignored by the airlines, they have nowhere to turn but the federal government."

Ruden and his organization are asking for $4 billion in aid.

The industry also wants the White House to consider a 100 percent tax deduction for all travel and related expenses.

Some travel agents in Central Pennsylvania say help can't come a moment too soon. And not all of the problems can be tied to the terroist attacks.

Shaun Balani, president of Travel Time in Lancaster, says things are so bad right now, he's "going to predict that 30 percent of all travel agencies nationwide are going to go out of business."

He says total sales have dropped by 80 percent since this time last year.

Balani blames much of it on the airlines, pointing out that airline commissions to travel agencies have been dropping for the past six years, as airlines struggled to stay solvent.

In 1995, he says, an $8,000 first-class ticket to London would have fetched a flat 10 percent fee, or $800.

"Today the maximum amount the airlines pay is $20 or 5 percent, whichever's less," he says.

He says things seemed to pick up a little last week.

"My gut feeling, in two more weeks, we'll be on a much more even keel out there," Balani says.

But the problem is the long haul and people's fears.

Dropping the price, he says, won't change anything if people are simply afraid to go anywhere.

"You can't impact people's emotions," he says.

Balani also doesn't think it's fair that the airlines should get all that help.

"It's one single industry. Everybody's been impacted," Balani says. "Brokers lost offices. So why just the airline industry?

"It doesn't make sense to me," he adds.

John Bailey also is steamed.

The president of Bailey Travel Service in York says, despite some group tours that are going to places such as Branson, Branson, Mo.; Canada; Bermuda; and Australia, overall business is down by 50 percent. He endorses the ASTA proposal.

Ruden says travel agencies have already lost about $1.36 billion in the weeks following the attacks. That amount is expected to grow to up to $4 billion by the beginning of next year. And that's unfortunate, he says, because "without travel agencies, the nation's travel industry, airlines included, simply cannot function. The airlines and their Web sites cannot handle the volume of calls to assist consumers..."

Meanwhile, Balani is doing his own small part, Last week, he gave each of his 19 employees a $50 gift, as thanks for weathering the attack fallout with flying colors. But there were some catches: No saving the cash. It had to be spent as a treat by Sunday, Sept. 30, to help stimulate the economy.

What wasn't spent had to be returned to him on Monday.