Derating GPS wouldn't affect the time reference functionality. Turning off GPS entirely would seriously affect military aviation operations.
Not so:
"Selective Availability (SA) is the deliberate introduction of error by either altering the precise timekeeping of GPS satellites or the position of the satellites in space, through the on-board software, thereby reducing both positioning and timing accuracy for civilian users."
GPS accuracy is generally reduced by adding noise to the timing. Now you would have to derate GPS pretty significantly before timing accuracy would be significantly affected. But it's possible that some time references would refuse to lock on at all with sufficient derating. The affects of more extreme derating than SA are, at least to some extent, unknown.
While this is true, the derating in common practice for SA when it was turned on actually turned out to be somewhat less inaccurate than the combination of atmospheric error and other issues in most GPS-based time sources. For NTP, network jitter would exceed SA jitter in most implementations.
Aviators try very, very hard not to trust their lives to GPS.
As opposed to LORAN ?
Generally, aviators don't like SPOFs. So they try very hard not to trust their life to any one thing. GPS is used in conjunction with VORs, pilotage (navigation by reference to fixed objects), and dead reckoning.
Pilotage is _VERY_ difficult in IMC. Most IFR pilots don't rely much on pilotage most of the time, and almost never attempt pilotage in IMC. It is true that most of them use VORs and RADAR as their primary navigational backups under IFR in IMC.
GPS is used for instrument approaches, but only under extremely controlled conditions by very experienced pilots. A significant fraction of instrument training is how to cross-check instruments and detect failures. GPS approaches are individually approved by the FAA and factors such as runway lighting are critical. FAA approved GPS units must be used and one of the things these GPS units must do is monitor signal integrity (RAIM). From time to time, you will read FAA accident reports of people who attempted to perform GPS approaches with just a handheld GPS.
Excuse me? GPS is used for instrument approaches by virtually any instrument rated pilot. A pilot can conduct a GPS approach solo with as little as 75 hours of PIC experience (35 hours part 141 private course and 40 hours instrument training) (14CFR parts 61 and 141). I would not consider a pilot with 75 hours or even 100 hours "very experienced". Heck, I have over 650 hours and I don't consider myself "very experienced". I haven't looked back at my logbook to be sure, but, if memory serves, I got my instrument rating at about 225 hours, and, shot my first solo GPS approach with around 250 hours of PIC experience. You are right that a significant portion of instrument training is how to cross-check instruments and detect failures. Mostly, however, this focuses on failures of instruments related to keeping the airplane right-side up. Some cursory coverage is given to detecting navigational failurres, but, as much as I try to behave differently, and, as much as I wish this weren't true, the primary mode of navigational failure detection employed by most IFR pilots I've met is when the controller says "Where the heck are you going?" (no, this isn't from the Pilot Controller glossary, nor is it how they usually convey that message). It is true that to begin a GPS approach, you must have an approach certified (TSO'd) unit in an installation that the FAA FSDO has signed off as an approach capable installation. It's also true that you need RAIM, and, RAIM provides a certain amount of integrity more than standard GPS and more than ILS. (Actually ILS glide-slope only failues are the ones that scare me the most as an IFR pilot). I'm not saying the system is unsafe. I think it's very safe. I also agree about the accident reports regarding handhelds, however, I will say that with a safety pilot on board, I occasionally do make sure that I can do a panel-out (yes, that means put the sectional over the entire panel) approach using my Garmin 195. I would never do this in actual IMC, and, I would never do it without a safety pilot looking out the window and watching what I was doing. However, I feel safer knowing that I can, if evertyhing else goes to heck, get the plane down a GPS approach using the handheld. It is a _VERY_ challenging approach. Owen