Congress Will Not Underwrite Failing Airlines Says

[Captain Ed]

http://www.house.gov/transportation/
U.S. House Committee on Transportation and Infrastructure
U.S. Rep. Don Young, Chairman
Contact: Steve Hansen (Director of Communications) (202) 225-7749
Email: Steve.Hansen@mail.house.gov
Justin Harclerode (Deputy Director of Communications) (202) 226-8767
Email: Justin.Harclerod@mail.house.gov
To: National Desk/Transportation Reporter
June 3, 2004

Congress Will Not Underwrite Failing Airlines Says House Aviation Chairman

Washington, D.C. – The Chairman of the U.S. House Aviation Subcommittee at a Congressional hearing today on the health of the aviation industry said that the federal government should be willing to assist the industry in meeting some costs incurred by federal security mandates, but that the government will not simply underwrite failing airlines.

The Aviation Subcommittee received testimony from top officials from six airlines, including three of the major legacy or network airlines and three low-fare carriers, as well as the U.S. General Accounting Office (GAO) and other aviation industry experts.

Since September 11, 2001, the airline industry has managed to survive an unprecedented terrorist attack, as well as the subsequent economic slowdown, a dramatic downturn in business travel, a SARS epidemic, international conflicts, bankruptcies and soaring fuel prices.

However, the industry has lost over $24 billion in that time period.

To help ensure the industry’s survival and maintain its vital role in the U.S. economy, Congress has provided significant assistance to the airlines. This includes over $20 billion in the form of cash, loan guarantees, direct reimbursements for security, tax holidays, defined benefit pension reform and war risk insurance coverage. Some $5 billion was provided to airlines that suffered losses from September 11th. In addition, $3 billion was provided to airlines for security mandates and $10 billion in the form of loan guarantees.

Subcommittee Sympathetic To Airlines’ Concerns But Industry Must Take Steps To Ensure Its Own Survival
“Despite this amount of assistance, the financial condition of some of our airlines is precarious at best,†said U.S. Rep. John Mica (R-FL), Aviation Subcommittee Chairman, at today’s hearing

“We’ve had 10 airlines file for bankruptcy since 9/11 and it appears that more may soon follow.

“The industry is leveraged to the max with over $100 billion in debt. Eleven of the 12 passenger carriers are rated ‘junk bonds’ by Standard & Poor’s ..................

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Celebrate De-Reg!

After all, why does a country like the USA need an Airline infrastructure?

What about all those poor little illegal immigrants that need those billion$ for medical and housing assistance, the poor Snail Darter, and .........

I think I'm gonna PUKE!

 

[skybolt]

How bout the taxpayer don't subsidize anybody?

Let's cut off: the airlines, the auto industry, welfare mommas, Palestine, Israel, Europe, Japan, Mexico, Russia, big tobacco, West Virginia bicycle trails, Puerta Rico, exploring the titanic, wool and mohair, etc, etc, etc,

Somewhere I remember reading that the Federal Gummint was supposed to provide for commerce, provide protection, provide a legal system, and danged little else. There is something about the general welfare, as opposed to individual welfare in there as well.

My only present wish for spending is that the troops in Iraq don't run out of ammo and that we could afford to buy our Iraq based aviation mechanics hand protection so that they can work outside without suffering second degree burns on their fingers. I recently received a request from an army helo mechanic to send black mechanics gloves. It seems that the army is too poor to provide gloves and the boys were passing around one pair that another soldiers wife had bought at autozone and sent in the mail. Sad , very sad.

skybolt

 

[flyer5308]

skybolt you're right on target! Why the heck should we (taxpayers) have to subsudize the reckless management of the majors or any other airline for that matter? Com'on! Dereg didn't kill the airlines, they shot themselves in the landing gear so-to-speak. Can anyone hear spell Eastern?? :blink: