Originally Posted by flybynuts

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

Originally Posted by jsled

Yeah. Yeah. And if SWA did not have fuel hedges.

Originally Posted by OscartheGrouch

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.

Originally Posted by mulcher

Umm...this is a little different then a Govt handout. SWA fuel hedges are a business descision that SWA paid for. Not the Govt wellfare that saved one or two airlines. Ones that should have went out of business.

Originally Posted by WhistlePig

Did Lee Cash say that?

Originally Posted by jsled

<<"ones that should have went out of business">>

That is an opinion. Not fact. UAL is still here. Get over it.

Originally Posted by mulcher

Do you feel better after beating your chest Nancy. I never mentioned Yonited. But you must think they should have gone out of business with the defensive remark. Not much to get over. I couldnt careless. I just love how some are so proud of receiving wellfare they brag about it. I guess Yonited is a more fitting term now.