The Federal Aviation Administration is trying to implement a $35 billion overhaul of the nation’s air traffic control system that would replace old-fashioned radar technology with modern satellite-based GPS navigation. But according to the Associated Press:

A new computer system key to modernization of the nation’s air traffic control system has run into problems, raising doubts about whether it can be operational 15 months from now when current computers must be replaced, union officials said Wednesday. The Federal Aviation Administration tried unsuccessfully to deploy the new computer system last weekend at a regional air traffic control center in Salt Lake City, the first of 20 regional facilities where the computers need to go into operation before the end of 2010 … the new system was shut down about nine hours later after it misidentified an airliner, controllers said.

The situation is not surprising. According to Chris Edwards:

The Federal Aviation Administration has been mismanaged for decades and provides Americans with second-rate air traffic control. The FAA has struggled to expand capacity and modernize its technology, and its upgrade efforts have often fallen behind schedule and gone over budget. For example, the Government Accountability Office found one FAA technology upgrade project that was started in 1983 and was to be completed by 1996 for $2.5 billion, but the project was years late and ended up costing $7.6 billion.

The solution:

The good news is that a number of countries have privatized their ATC and provide good models for U.S. reforms. Canada privatized its ATC system in 1996. It set up a private, nonprofit ATC corporation, Nav Canada, which is self-supporting from charges on aviation users. The Canadian system has received high marks for sound finances, solid management, and investment in new technologies.

For more, see this essay on privatization.