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What's the airline-industry jargon for unconventional wisdom? Southwest Airlines.

By some estimates, the country's major carriers have consumed perhaps $100 billion in capital during the past decade, but Southwest Airlines continues to be profitable. It's been in the black for 33 consecutive years and, last week, for the 127th consecutive quarter, it paid a modest dividend. Its balance sheet, with about $3 billion in cash on hand and $600 million in available credit, is the envy of an otherwise fuel-price-ravaged industry.

Its competitors among the network carriers—American, United, Delta, Continental, Northwest and US Airways—are shrinking passenger capacity by more than 10 percent and grounding hundreds of aircraft starting in the fall. Southwest will add a handful of daily flights. It will take delivery of another dozen aircraft next year and still plans to grow by 2 to 3 percent. And Southwest now carries more passengers annually (101 million last year) than any other U.S. carrier, a nifty trick for an airline that didn't fly outside Texas at the dawn of deregulation in 1978.

Even the fickle financial markets, which have long discounted Southwest's relentless growth and steady profits, have finally taken note. As oil prices doubled in the past year, share prices of the six network carriers have slid, with the drop-offs ranging from 76 to 94 percent. Southwest's decline has been more modest, within a point of the Dow's 21 percent 52-week drop. As a result, Southwest's market capitalization yesterday (about $9.7 billion) is now more than the combined $5.7 billion market cap of its Big Six competitors.

What does Southwest know that no one else in airlines does? It keeps things simple and consistent, which drives costs down, maximizes productive assets, and helps manage customer expectations.

One Plane Fits All

Unlike the network carriers and their commuter surrogates, which operate all manner of regional jets, turboprops, and narrow-body and wide-body aircraft, Southwest flies just one plane type, the Boeing 737 series. That saves Southwest millions in maintenance costs—spare-parts inventories, mechanic training and other nuts-and-bolts airline issues. It also gives the airline unique flexibility to move its 527 aircraft throughout the route network without costly disruptions and reconfigurations.

Point-to-Point Flying

Network carriers rely on a hub-and-spoke system, which laboriously collects passengers from "spoke" cities, flies them to a central "hub" airport, and then redistributes them to other spokes. Not Southwest. Most of its flying is nonstop between two points. That minimizes the time that planes sit on the ground at crowded, delay-prone hubs and allows the average Southwest aircraft to be in the air for more than an hour longer each day than a similarly sized jet flown by a network carrier. Southwest's avoid-the-hubs strategy also pays dividends in on-time operations. According to FlightStats, Southwest's 78 percent on-time performance in June is eight percentage points higher than the industry average and higher than that of any of its major competitors.

Simple In-Flight Service

Business travelers haven't always loved Southwest's über-simple service, but it's looking better and better as competitors cut back. There is just one class of service, a decent coach cabin that is slightly more spacious than those of Southwest's competitors. There are no assigned seats. There have never been meals, just beverages and snacks. Keeping it basic allows Southwest to unload a flight, clean and restock the plane, and board another flight full of passengers in as little as 20 minutes compared with as much as 90 minutes on a network airline. Airline efficiency experts say that the savings allow each Southwest jet to fly an extra flight per day. Extra flights mean extra revenue.

No Frills, No Fees

As other carriers have rushed to remove perks and pile on fees and restrictions, Southwest has kept its customer proposition streamlined and transparent. The airline only sells one-way fares and only in a few price "buckets." That not only keeps costs down—complex fare structures are expensive to manage—it convinces fliers that they are getting value for money. Prices are all-inclusive too. Southwest doesn't have fuel surcharges, doesn't charge for standby travel or ticket changes, and continues to permit travelers to check two pieces of luggage free. And since every seat on every flight is virtually identical, travelers know exactly what they will get when they make a purchase.

Strong Management

The public face of Southwest Airlines for a generation, hard-drinking, chain-smoking, always-leave-'em laughing Herb Kelleher, finally stepped away from the carrier earlier this year. Kelleher's bonhomie masked the discipline that Southwest has had throughout its history. The airline has always avoided fads and eschewed anything that increased costs or complicated the basic travel proposition. When it has changed—last year it ended its infamous cattle-call boarding process to favor its most frequent fliers and highest-fare customers—it has done so without slowing down the movement of aircraft. Management ranks are lean, but well compensated and, most importantly, productive. I once calculated that the top executives of Southwest generated 10 times more revenue per dollar of compensation than did the C-suite types at some of the network carriers.

A Relatively Happy Workforce

Network carriers have railed for decades about the power of their employee unions. But guess who's the most unionized carrier in the nation? Southwest, of course. The airline says that 87 percent of its employees belong to a union. Southwest has never had a strike, and now that the network carriers have whacked away at salaries and benefits, Southwest staffers are generally the highest paid in the industry. But since Southwest has about 30 percent fewer employees per aircraft than its network competitors, it has the lowest non-fuel C.A.S.M. (cost per available seat mile) of any of the major carriers.

Aggressive Fuel Hedging

Rampaging fuel prices now represent around 40 percent of an airline's costs, but, as usual, Southwest Airlines has been ahead of the curve. Since 1999, the airline's aggressive fuel-hedging program has saved it an estimated $3.5 billion. In the first quarter, for example, it paid $1.98 a gallon for fuel, approximately a dollar less than its network competitors. And Southwest's future position is admirable: It is 70 percent hedged at $51 a barrel through the end of the year and 55 percent hedged at the same price next year.

In a world of $140-a-barrel oil, suggesting that any airline is a guaranteed winner is beyond hubris. But this much can be said: Southwest Airlines is sitting on a pile of cash and fuel hedges and has a proven and easily adaptable service model. And history shows that Southwest has comfortably survived every airline-industry downturn, then grown rapidly and profited hugely when the business cycle turns.

The Fine Print…

British Airways announced last week that it would buy L'Avion, the French carrier that flies all-business-class jets between Newark and Paris. B.A. says that it will integrate L'Avion with its own boutique carrier, OpenSkies, which launched last month. L'Avion was the last of the four independent all-business-class trans-Atlantic carriers that have launched since 2005. The others—Maxjet, Eos, and Silverjet—all folded in the past seven months.

1965: An astronaut in space holds a conversation with an aquanaut underwater, marking another milestone in human communication.

Astronaut Gordon Cooper, orbiting the Earth with Pete Conrad in Gemini 5, hooked up by radiotelephone with an old pal, astronaut-turned-aquanaut Scott Carpenter, who was living and working 205 feet beneath the surface of the Pacific Ocean near La Jolla, California, aboard Sealab II.

The two men had known each other since 1959, when they were among the seven pilots chosen by NASA to be America's first Project Mercury astronauts. Carpenter, a former Navy pilot, had already been in space, the solo astronaut on a mistake-plagued, three-orbit flight aboard Aurora 7 that resulted in his being effectively grounded.

He was on leave from the space agency when he joined the Navy's Sealab II project as training officer. Carpenter eventually resigned from NASA in 1967. He retired from the Navy in 1969.

Cooper and Conrad, meanwhile, were nearing the end of an eight-day orbital mission to test human endurance in space. Eight days was recognized as the time needed to travel to the moon and back. (Five days was the longest Soviet space flight before then, and the American record was four days. By years' end, American astronauts would complete a 14-day mission in space.)

The radio hookup was partly a gimmick, to take advantage of Carpenter's astronaut status to publicize the Sealab II project. But it was also a method of testing the effectiveness of an underwater electronics lab installed aboard the submersible.

Gemini 5 was not the only long-distance call made from Sealab II. The Navy aquanauts also spoke with President Johnson at the White House and with Jacques Cousteau's Conshelf 3 team, French colleagues conducting a similar underwater-habitat test off Cap Ferrat in the Mediterranean Sea.

Following their chat with Carpenter, Cooper and Conrad readied Gemini 5 for its return to Earth and splashed down in the very same Pacific Ocean later that day.

Thirty years later, in 1995, Carpenter recreated his seabed-to-space call, chatting with astronauts aboard the space shuttle Endeavor while staying at Jules' Undersea Lodge off Key Largo, Florida.

Source: Various

BLACK ROCK CITY, Nevada -- Wild rides, fireworks and letting it all hang out. That's the updated American dream at Burning Man 2008.

The annual desert gathering always celebrates that most-American ideal: freedom. Freedom to ride a giant red, white and blue tricycle across the playa; freedom to blow your mind however you want; freedom to traipse around wearing nothing but body paint.

That kind of ingrained whimsy, rather than politics, seems to be the point of this year's American Dream art theme at Burning Man. "What has America achieved that you admire?" is the event's official statement. "What has it done or failed to do that fills you with dismay? What is laudable? What is ludicrous?"

Groovy, man. Let's get it on.

Left: Red, white and blue abounds at the festival this year.

Red, white and blue abounds at the festival this year.

A stagecoach rolls up the esplanade on Tuesday evening.

Duane Flatmo from Eureka, California, steers his fire-breathing dragon around the esplanade Tuesday.

After hunkering down during Monday's sandstorm, burners break out their colorful costumes Tuesday -- including some that are just painted on. Robin Bowles, right, and her friend Cowboy Curtis chill on the playa on a "fuzzy bunny." The Man can be seen far off in the distance on the left.

A group of burners break out a desert "boat" to parade across the playa.

Black Rock City is humming Thursday.

Lamp Lighters walk down the esplanade Tuesday.

A panel van decked out with a lit-up Golden Gate Bridge makes its way across the sand Tuesday.

Tutu-wearing burner Diana Zanelli of Texas delights in the swirl of lights from inside artist Crispell Wagner's "modern version of the dream machine," an interactive piece of light art.

Home is where the art is at Burning Man.

The Man glows with neon as Helen Corley from San Ramon, California, twirls her flow lights below the festival's namesake icon in Black Rock City.

A giant duck lights up the night Tuesday as it rolls across the dusty desert floor.