Just so you know this is nothing personal towards anyone or towards any particular airline. I am trying to use simple economic principles that in the event of a failed business plan or even a catastrophe (9-11) a business or airline would have been allowed to fail. No government grants, loans, etc. for any airline after 9-11 and the "majority" of airline employees would have been better off over time. With less capacity the easier it is to raise prices to cover costs. Same principle applies to personal bankruptcy where an individual is allowed to forgo payment of his bills forever therefore causing the business that he stiffed to raise their prices to make up for the loss of revenue. Everyone else pays for the mistake (or misfortune) of individuals (or airlines) who don't pay their bills. My use of the word stealing while maybe a poor word choice was meant to indicate that money was diverted (through the bankruptcy process)from one business to another. Therefore taking money out of the pocket of one and placing it in another without their consent.

I certainly would not want to go through what employees at bankrupt carriers have had to go through and I have compassion for their situation. That being said if you take the emotion out of the equation and allow a truly free market to work it would have eliminated the weakest business models after 9-11.

I figured I might offend those who have had to endure the bankruptcy process with huge sacrifices on their part. I again would remove the emotion (which I am sure is very difficult for many) and try to use financial logic. I mean nothing personal.

I will end with a scenario that I read about a few years ago in Business Weekly. It stated that if if United had gone out of business in 2002 (as it would have without government grant money) every airline would have made money that year. While a difficult pill to swallow for the employees of United the rest of the industry would have been better off because of their failure. It would indicate that the bankruptcies at other airlines would not have happened and the givebacks ($ and retirements) by employees at the surviving carriers would have at least been less and perhaps nothing. Just a thought.

 

I just hope SWA matches the fare raises by other airlines and the other do the same for when SWA raises fares; A level playing field helps everyone. Right now about everyones fares are on par with each other, we don't need airlines like skybus and VA lowering the bar. Already I read a report where SWA is operating at a loss on routes to go head to head with Skybus....That can't be good at all.

 

OSCARTHEGROUCH-

Well worded, astute, logical and respectful post. I absolutely agree with you.

 

Oscarthegrouch,

Great post that everyone should mull over. In college I had a proffessor who claimed that by allowing airlines to operate in and out of bankruptcy will hurt the "whole industry" in the future (meaning 2000s and beyond). Hard to believe that he may have been right. He also said that deregulation was the worse thing that could happen to the airline industry as well.

S/F

 

Flying used to be a luxury service, now it is mediocre bus service. The problem is, while deregulation hurts the industry, it benefits the economy as a whole. That's why the government will allow the airline industry to continually go down into the dumps without penalty.

 

Yes, it was a great post. Some of you guys have very short memories. How many times have we seen the heavy weight boxer of yesterday working as a doorman today. Who would have believed that Pan Am, TWA, and Eastern would have gone out of business? Things have a way of turning around in this industry. I never thought I would have witnessed Wall Street state that LUV is a worthless stock and they should follow the example of the Legacies. How's that for a turn around?

You guys sit there and complain about a helping hand or corporate walfare. Well, ponder this. If a legacy carrier ceased to exist, it would have created an environment for new no-frills start-ups, like SkyBUST. IF guess you guys think it's ok for an F/O to make 30K and a Capt to make 75 flying a 150 seat aircraft, then carry on. The race to the bottom would be accelerated and the argument would be totally different. Some of you guys are very short sighted.

Airtran just raised fares probably in response to the new T/A the pilots have signed or will sign (I'm not certain), but the fact is they raised fares. LUV raised fares right after their new T/A. Now that your fares are higher, and will have to inch higher, you too are at a disadvantage to SkyBUST and Slut, I meant Virgin. We are not so different afterall. The race to the bottom continues. Take care, Oscar.

Tom

 

Now THAT is an excellent post. Senator McCain, a third generation Sailor and Naval Aviator, has already stated that pilots are OVERPAID. Gee, I don't feel over paid. With current policy and the direction of new policy, we ALL know that Washington does not have our best interest at heart. I should be working an oil rig for Halliburton ... now theres a secure job with defined benefits, promotions, and the president in it's back pocket.

 

Tom, our last T/A was in 1994. We had a 10 year contract with a 2 year extension and are in negotiations but nowhere near a T/A.

 

How are things going with the negotiations? Do you think that pay or work rules will change much?

 

It stated that if if United had gone out of business in 2002 (as it would have without government grant money) every airline would have made money that year. >>>


Yeah. Yeah. And if SWA did not have fuel hedges...yada yada. If "ifs" and "buts" were candy and nuts.....oh what a merry Christmas we would have. Wait, if Continental would have went out of business in their 2nd bankruptcy, maybe the industry would have been stronger for 9/11. Or if the ATSB would have approved UAL's loan guarantee like they did for US Airways and America West, maybe UAL would have avoided bankruptcy altogether. One will never know.