Are soaring fuel prices and safety concerns crippling airlines? Certainly.

But those challenges pale in comparison to overly lenient U.S. bankruptcy laws and greedy labor unions, aviation experts said Wednesday at the inaugural Las Vegas World Aviation Forum.

And if the system is going to be fixed, it will take big changes on Capitol Hill, those panelists added during the three-day event's concluding seminar at Henderson's Green Valley Ranch Resort.

Jonathan Ornstein, president and chief executive officer of Mesa Air Group, was outspoken in his criticism of the large unions that represent aviation workers.

Because unions can intimidate airline operators through slowdowns and strike threats, Ornstein said, most U.S. airlines operate "with a gun to their head" when negotiating with their employees. As a result, airlines too often compromise their financial footing by conceding too much money or unfavorable work rules to union-backed employees, he said.

When those concessions inevitably cripple an airline's bottom line, Ornstein said, airline management "takes the gun back" and aims it at the union by filing for bankruptcy, where judges typically strip away pensions, labor contracts and other employee benefits to ensure the airline can continue operating.

Neither instance is good for airlines or their workers, Ornstein said, adding that federal leaders must intervene and address current labor laws or no amount of tinkering will save troubled legacy carriers such as Northwest and United Airlines from imploding under burdensome labor costs.

"It's the lack of big unions that allow low-cost carriers to succeed," Ornstein said, citing AirTran, JetBlue Airways and Southwest Airlines as current examples. "The labor laws need to change but no one in Washington is willing to take it on."

Mark Dunkerley, president and CEO of Hawaiian Airlines, also called for changes at the federal level, though he was particularly critical of U.S. bankruptcy laws that allow businesses to operate under Chapter 11 protection for years at a time.

Instead, he said a business should be given just six to 12 months to correct its problems before a shutdown ensues. In the airline industry, such measures would alleviate excess capacity and reward operators whose business models have proven financially sound, he said.

"We have a system that's not good at getting rid of inefficient operators. ... A business should be fixable in two years or it shouldn't be in business," said Dunkerley, who oversaw Hawaiian Airlines' June emergence from Chapter 11 following a $71 million operating profit last year.

UAL Corp., the holding company for United Airlines, has operated under bankruptcy protection since December 2002; it does not expect to emerge from Chapter 11 until early 2006.

US Airways filed Chapter 11 in September 2004 but recently emerged thanks to its merger with America West Airlines. More recently, Delta Air Lines and Northwest Airlines each filed for similar protection in September.

Ornstein somewhat disagreed, however, adding, "I'm convinced if you fix labor laws, you won't have to fix the bankruptcy laws because no one (in the airline industry) will need them."

Bill Franke, managing partner of Indigo Partners, a private equity fund that specializes in aviation industry investments, helped America West overcome a bankruptcy filing when he was its CEO from 1993 through 2001. These days, his company is reluctant to invest in U.S. operators because he does not believe they're posed to recover from issues such as high labor costs.

Ultimately, the traveling public really isn't interested in what takes place behind an the scenes at airline headquarters, he added. And if a long-standing giant like United or Delta disappears, few outside those companies would care -- as long as other operators step in to fill any void.

"The public wants to get from Point A to Point B quickly, safely and at a low cost," Franke said. "If you can't provide that product ... you will simply be a victim."