Pleeeeease no (more) corporate welfare for airlines.....

[ChairOne]

http://story.news.yahoo.com/news?tmpl=story&cid=509&ncid=509&e=5&u=/ap/20050109/ap_on_bi_ge/wall___main_4

"NEW YORK - Moves by the major airlines to slash prices made headlines over the past week, but a potential fare war is just one of a multitude of pressures facing the industry."

THIS is capitalism, you freeper motherfuckers. Let Adam Smith's hand do it's magic! Let a couple of the carriers go out of business. They won't *all* go, because there's a consistent market for the service. Let equilibrium be found *without* externalities!

"If one of the big carriers did go out of business, it would actually help the remaining airlines survive. Almost everyone agrees the biggest problem facing the industry is excess capacity — too many seats in the sky."

Exactly.

The govt better not do anything to keep carriers on life-support...

[Deja Q]

1. It's only capitalism when THEY want it. Otherwise they'll socialize what

THEY want and say it's just a small subsidy. :grr:

[RoeBear]

2. So it's ok to let all those (union, probably)workers

go in the unemployment line?

[Osamasux]

4. And what sucks even more about that is that many of them are

highly skilled, but the skills do not translate to any other profession. To make it even harder for them to swallow, those skills are still current and valuable, but the market is pricing the overall product below where it needs to be for the companies to be viable. It is not like someone is outsourcing the pilots or mechanics to the third world for $1 a day.

[ChairOne]

5. It's not "ok", but.......

... nor do I think it's economically healthy to prohibit failing businesses from failing.

On balance, I'd probably allow the business to fail. I'd also be very happy to see significant assistance being given to the laid off folks, aimed specifically at getting them at least near-equal employment as quickly as possible.

The article itself is pretty good overall, and contains a disussion of this problem:

"The problem is, when airlines run into trouble, they never seem to actually stop flying. This is in part because they employ huge numbers of people, which makes their demise political. A more compelling reason, McKenzie and other experts say, is that companies that lease aircraft to the carriers are often lenient when it comes to deferment of debt, because they conclude the planes are worth more in the air than on the ground at a liquidation auction."

But whichever side of the layoffs/let-bad-business-fail divide you're on, surely we can agree that it's NEVER appropriate to both insist that failed business be kept on welfare life support, and then go on and bitch about all the money the government wastes on pork... That just sounds hypocritical to me... You get one or the other...

[havocmom]

6. Well, they keep having to take pay cuts but most CEOs are doin OK

Might as well look for new jobs.

An airline just recently asked people to volunteerto work for the New Year's Holiday! Volunteer?!?! Course, they did say those who were already scheduled to work would get paid, but they needed volunteers to help avoid snafus.

How about new people making the decisions at the top to avoid snafus? US workers are supposed to make due with the whims of a 'free market'. Time for huge corporations to do likewise. Workers in many industries take pay cut after pay cut and then see tax $$ subsidise the bozos running the companions into the ground.

And the bozos at the top now want to get their paws on payroll taxes for Social Security. Anybody think they will treat forced investors any better than their other small investors and workers' pension funds?

Workers are not getting lower costs of living to match their shrinking pay checks. Why should their tax dollars bail out poor management time after time after time on top of making economic sacrifices already? Where is the incentive for management to change?

Anybody ever see the United Airlines Employee site: http://www.untied.com/
Check it out sometime, but make sure your blood pressure meds are handy!

[ChairOne]

9. Excellent points /eom

[HawkerHurricane]

17. American Capitalism...

Socialized costs, privatized profits.

[Osamasux]

3. I don't know what they are going to do about it.

I really think airline deregulation was a failure. We need airlines. The markets are NOT working for this problem. The latest Bush fuel cost increases have pushed quite a few over the edge. Their crisis is real - they are bleeding money and most of their stocks aren't worth the paper they are printed on. It's just one big frigging mess without a good solution on the table. Continental had to go through Chapter 11 to get back in good shape. Southwest treats their passengers like crap half the time. ATA has gone under. I just don't have an answer.

[Bluebear]

7. Do you realize how many tens of thousands of employees

you are talking about? What do you propose we do, sign up for a career "retraining" program?

[ChairOne]

8. Fine. Then don't complain about wasteful pork spending.... /eom

EDIT: I say this, and I've been unemployed for 6 months - I'm not at all unfeeling on the issue... lol

[Bluebear]

10. "Fine" just doesn't cut it for us

I don't know what the answers are. Non-union Delta starts this fare ware which is just going to bleed the airlines dry further. People will be delighted to get their $99. seats from New york to Miami which is a totally unrealistic price. They will complain onboard because Lobster thermidor isn't being served. It's a vicious cycle and totally out of control but my post was just to remind folks that a LOT of working people's jobs are on the line.

[ChairOne]

12. Lobster thermidor?

In any case, I hear you.

[ChairOne]

14. Wow!

http://www.lobster-recipes.com/lobster-thermidor.html

Homer-drool time....

[ChairOne]

11. And I hope people don't fall into the rhetorical attack....

... which looks like: I think X is a good idea, X is likely to lead to Y, therefore I support Y.

It just ain't so. Even though I in no way support large-scale (or even small, for that matter) layoffs, it's not being evil to suggest that ON BALANCE we're AS A WHOLE NATION better off without a failed money grubbing corportation than we are with it.

I'm not saying you, bluebear, have explicitly used this rhetorical technique, but it's a likely one to crop up here... just tryin to nip it in the bud...

[Bluebear]

13. There is no easy answer to this one.

At first blush maybe re-regulation or a nationalized airline system...but then we saw how great Amtrak worked. As the poster above said, the markets just are not working for this industry. Fuel is going higher and fares are going lower.

[ChairOne]

15. The "market" part of it is working fine....

it's the "free" part that's killing things...

(1) externalities (govt subsidies/bailouts) allow business to operated at a loss.

(2) Those same subsidies allow for more businesses than free competition (with failure allowed as an option) would permit.

And keep in mind: the government doesn't just snap its collective fingers to get its money. They get it from YOU.

But yah - it's painful either way.

[idlisambar]

19. Not a national monopoly like Amtrak....

...better might be a return to a regulated oligopoly. Such an arrangement would force competition between the players but dispense with the needless churn and "race to the bottom" dynamic in the industry. The devil is in the details of course.

[Donkeyboy75]

16. They simply ought to regulate the airlines again.

[idlisambar]

18. It's an unfortunate state of affairs

Not mentioned enough is the reason why so many "legacy" carriers can't compete with the upstarts. Quality of service and efficiency has little to do with it, it is mostly because of the extra costs they face in paying older employees and fulfilling pension obligations. Basically what is going on is a zero-sum transfer of wealth from airline employees and former employees to consumers. Today's efficient airlines better be careful not to give too many benefits to their employees otherwise in 15-20 years they will also succumb to the same pressures. This is hardly an example of capitalism at its finest, it is mostly just needless churn.