CAPPS II – The Continuing Saga

Way back in March, I preached support for a boycott of Delta Airlines, because of their participation in the TSA’s CAPPS II project. Shortly thereafter, I happily reported that the project had been suspended. Now it’s back, with good news, bad news, and worse news.

The first bad news obviously is that it’s back. The good news is that it appears to be less bad than it was. During it’s time on the shelf, TSA tried to make it a little less objectionable. Bad news is that it’s only a little less bad, and it’s still bad. Good news is that Delta apparently learned their lesson and isn’t participating this time. Bad news is TSA found another willing partner. And the worse news, according to a Wired story, is that their new partner is Jet Blue.

Staying off of Jet Blue’s airplanes won’t be any more inconvenient for me than staying off of Delta’s. But a Jet Blue boycott would be bothersome for another reason. I have more at stake here. In April, following a recommendation from my financial adviser, I bought Jet Blue stock at about $29/share. Today it’s trading at about $59. 100% growth in 5 months ain’t too shabby. But now what?

Practically speaking, I’m not sure if there will be sufficient public outrage over this to hurt Jet Blue’s bottom line. The Delta issue doesn’t provide much fodder for comparison, since Delta (like most airlines except Southwest and Jet Blue) was already in the toilet. But, aside from worrying about what will happen to my stock value, I have a slight ethical dilemma. Should I continue to invest in a company whose actions are so reprehensible? If my morals are that low, I might as well invest in Halliburton. I could sell the stock as a gesture of protest, and take a nice little profit. Since it’s in a Roth IRA, I wouldn’t have to worry about the short-term capital gains hit. But I really wanted to ride this one to the top.

I tried asking Jet Blue about it, hoping the news wasn’t really as bad as it sounded. And of course, according to them, it wasn’t:

Hello Matt,

Thank you for your e-mail, and for raising several important privacy
issues. Let me assure you, JetBlue shares your concerns.

Contrary to reports, JetBlue has not entered into an agreement to
implement the CAPPS II program with the Transportation Security
Administration. Further, no JetBlue customer information has been
provided for purposes of testing the CAPPS II program currently under
design.

We respect and support the important work of the TSA and, like other US
carriers, we?re proud to have a close working relationship with them.

JetBlue has always placed the highest priority on the safety and
security of our customers and crew. We were the first to outfit our
entire fleet with bulletproof, Kevlar-plated cockpit doors after 9-11,
for example.

Thank you for the opportunity to clarify the speculation surrounding our
ongoing work on improved security. We hope to continue to have the
pleasure of serving you aboard JetBlue.
Hope all your skies are JetBlue!

Judy
JetBlue Customer Commitment
Crewmember 12789

Of course, the response sounded canned, but I thought that was just because they’d gotten a lot of inquiries. I chalked this one up to another case of media bungling … until the next day.

Another Wired story burst my bubble, not only confirming that I was not the only one who received that “carefully worded statement”, but pointing out that it was grossly misleading, at best. Jet Blue themselves had confirmed that they “provided 5 million passenger itineraries to a defense contractor for proof-of-concept testing of a Pentagon project unrelated to airline security.” OK ..so it may technically be true that “no JetBlue customer information has been provided for purposes of testing the CAPPS II program”. The information has been provided for other, even less justifiable, purposes. Passenger data, including addresses and social security numbers, was given to a private contractor which posted it on a website. This kind of careful dancing around the truth is not what I expect from companies in which I invest, even if they do make good money.

Anybody got any good recommendations for a nice little growth stock I could buy if I unload Jet Blue?

6 Replies to “CAPPS II – The Continuing Saga”

  1. Even if I sell, you still have to wait until I retire to cash in. I re-checked all the links in this story, and they all work for me. Which one do you think is bad?

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