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The dream of hundreds of space tourists was dealt a blow last Friday when Virgin Galactic's experimental SpaceShipTwo broke up over California's Mojave Desert. The pilot was injured and the co-pilot died in the accident.

But many are still holding on to their tickets.

"We're in a testing phase, and things happen," says Jim Clash, an adventure journalist who put down a $20,000 deposit on his $200,000 ticket in 2010. (Prices for tickets have since risen to $250,000.)

Clash has no plans to cancel. "I've done a lot of the things I've wanted to do on my bucket list, but space is something I haven't done," he says. "And I really want to do it."

SpaceShipTwo doesn't travel all the way into orbit. It's designed to rocket just to the edge of space and then float back to earth. Passengers get a couple of minutes of weightlessness and one heck of a view. That was enough to get hundreds of people to sign up.

Since the accident, Virgin Galactic reports that 20 or so ticket-holders have asked for refunds. Among them, the U.K.'s Princess Beatrice, according to media reports.

"That doesn't surprise me, I think there's a group actually, that bought the tickets because they're fashionable," says Clash.

But more serious ticket-holders seem to be hanging on, at least for now.

"We think that this is going to be a very productive area across the 2010s and into the 2020s for research applications," says Alan Stern, an associate vice-president with the Southwest Research Institute, a nonprofit research institute based in Texas. The institute has bought a total of nine seats on future flights for their own experiments. "We want to be out front," Stern says.

Both Clash and Stern say they expected setbacks when they purchased their tickets. "Just like the early airlines and the early jet age, there will be some bumps along the road," Stern says.

And despite the fact the NTSB investigation could take up to a year (and the fact that SpaceShipTwo's replacement isn't yet ready to fly), Clash doesn't see himself cancelling his ticket.

"I'm willing to wait as long as it takes," he says.

SpaceShipTwo

Virgin Galactic

Airlines are paying less for jet fuel these days. But don't expect that price drop to translate into Thanksgiving travel bargains for you.

Rather than cut fares, airlines are turning fuel savings into cash for acquiring aircraft, upgrading software, rewarding workers and attracting long-term investors, according to John Heimlich, chief economist for Airlines For America, A4A, a trade group.

The major carriers that filed for bankruptcy during the Great Recession have learned to be more "fiscally responsible," Heimlich told reporters Thursday. After years of fighting with creditors, "they are paying their bills," he said.

In the long run, "enhanced creditworthiness" will create a more stable industry that can better serve travelers, Heimlich said.

But for now, those bill-paying efforts are sending air fares higher, with carriers pushing them up five times this year, according to Farecompare.com.

While A4A notes that fares are lower than in 2000 after adjusting for inflation, consumers might point out that today's higher fees and taxes have driven up total travel costs. In addition, in many markets, fliers have fewer choices following a merger wave that combined American Airlines with US Airways; United with Continental; Delta with Northwest; and Southwest with AirTran.

Business

Regulators And Airlines Fight Over Fares, Fees And Fairness

Heimlich points out that the consolidated industry needs additional revenue to keep pace with higher operating costs for aircraft loan payments, rents, landing fees, new software and skilled labor.

In fact, the industry's capital expenditures for the first nine months of this year amounted to more than $1 billion per month — the highest rate of reinvestment in 13 years, he said. Customers are benefiting from those investments by getting more Wi-Fi options, updated gate areas, new aircraft and better kiosks.

These upgrades may attract more travelers in the future, but for now, domestic air traffic growth has been restrained, still running below pre-recession levels.

Heimlich predicts that this year's improving economy will help nudge up air travel to 24.6 million passengers over the Thanksgiving travel period, an increase of 1.5 percent from last year. But that number is still about 6 percent lower than the Thanksgiving period before the recession hit, he said.

He says this year, Sunday, Nov. 30, will be the busiest air travel day of this year, followed by Wednesday, Nov. 26.

George Hobica, founder of Airfarewatchdog.com, says bargain hunters have better luck finding cheap flights when they are willing to accept "middle seats next to the lavatory, red-eye flights, or 5 a.m. departures."

air travel

Airlines

A trade group representing more than 1,400 for-profit colleges has filed a lawsuit against the federal government over regulations aimed at curbing industry abuses.

The group seeks to stop a federal regulation, known as the "gainful employment rule," that was formally put into place last week by the U.S. Department of Education. The rule restricts access to federal student-aid dollars for institutions deemed to have too many students who struggle to pay back their student loans.

The rule is aimed at cracking down on institutions that charge excessive tuition, especially for programs that have little value on the job market. The Department of Education says the regulation could potentially affect up to 840,000 students, and, the trade group says, 3.5 million in the next 10 years. Two million students are currently enrolled in for-profits.

The for-profit colleges depend heavily on federal aid money, and the lawsuit filed Thursday is the latest salvo in a battle that has now stretched over five years and at least one other lawsuit.

At issue in the current suit are the criteria used to determine whether, and how many, students are struggling. The Education Department is proposing to compare graduates' student loan debt to their earnings. The schools say such a measure is unfair because how much money students make after graduating is not in their control.

"The gainful employment regulation is nothing more than a bad-faith attempt to cut off access to education for millions of students who have been historically underserved by higher education," Steve Gunderson, president and CEO of the Association of Private Sector Colleges and Universities, which brought the lawsuit, said in a statement.

Dorie Nolt, the Education Department press secretary, said, "We're confident that the department is within its legal authority in issuing gainful employment regulations that will protect students and taxpayers' investments by bringing more accountability and transparency to career training programs."

Barmak Nassirian, an independent policy analyst, says the legal case is really trying to get at something much bigger: "An industry is really challenging the right of an agency to question its entitlement to free federal money."

Both he and Ben Miller, a senior education policy analyst at the New America Foundation, say that even should the rule survive this new challenge in court, enforcement efforts could be defunded by the new Republican-controlled Congress, or the idea could be axed altogether by the next president.

Bottom line, Nassirian says, "I think 'gainful' is as good as dead politically."

And, Miller points out, in the long run having the rule on the books may be beside the point.

He notes that enrollment in for-profit colleges fell by about 250,000 students between 2010 and 2012. "Three things happened," he explains. "First, when the department started this process in 2010, it started to freak schools out and force them to go re-evaluate programs and close or shrink the poor performers."

Miller points to the example of one-year certificate programs in criminal justice that advertised after the popular CSI drama series on TV but gave graduates few plausible job prospects.

Second, media attention over the past few years has highlighted the problems with these and other practices in the for-profit industry.

"Continued public attention got students to be more discerning in consumer choices," Miller said.

Finally, he added, the financial troubles and collapse of Corinthian Colleges this summer took one of the most frequently criticized large players out of the picture.

All of which means, Miller said, that "the idea behind the rule works faster than the rule itself."

Airlines are paying less for jet fuel these days. But don't expect that price drop to translate into Thanksgiving travel bargains for you.

Rather than cut fares, airlines are turning fuel savings into cash for acquiring aircraft, upgrading software, rewarding workers and attracting long-term investors, according to John Heimlich, chief economist for Airlines For America, A4A, a trade group.

The major carriers that filed for bankruptcy during the Great Recession have learned to be more "fiscally responsible," Heimlich told reporters Thursday. After years of fighting with creditors, "they are paying their bills," he said.

In the long run, "enhanced creditworthiness" will create a more stable industry that can better serve travelers, Heimlich said.

But for now, those bill-paying efforts are sending air fares higher, with carriers pushing them up five times this year, according to Farecompare.com.

While A4A notes that fares are lower than in 2000 after adjusting for inflation, consumers might point out that today's higher fees and taxes have driven up total travel costs. In addition, in many markets, fliers have fewer choices following a merger wave that combined American Airlines with US Airways; United with Continental; Delta with Northwest; and Southwest with AirTran.

Business

Regulators And Airlines Fight Over Fares, Fees And Fairness

Heimlich points out that the consolidated industry needs additional revenue to keep pace with higher operating costs for aircraft loan payments, rents, landing fees, new software and skilled labor.

In fact, the industry's capital expenditures for the first nine months of this year amounted to more than $1 billion per month — the highest rate of reinvestment in 13 years, he said. Customers are benefiting from those investments by getting more Wi-Fi options, updated gate areas, new aircraft and better kiosks.

These upgrades may attract more travelers in the future, but for now, domestic air traffic growth has been restrained, still running below pre-recession levels.

Heimlich predicts that this year's improving economy will help nudge up air travel to 24.6 million passengers over the Thanksgiving travel period, an increase of 1.5 percent from last year. But that number is still about 6 percent lower than the Thanksgiving period before the recession hit, he said.

He says this year, Sunday, Nov. 30, will be the busiest air travel day of this year, followed by Wednesday, Nov. 26.

George Hobica, founder of Airfarewatchdog.com, says bargain hunters have better luck finding cheap flights when they are willing to accept "middle seats next to the lavatory, red-eye flights, or 5 a.m. departures."

air travel

Airlines