Network News

X My Profile
View More Activity

Remember the airline bailout?

airfrance.JPG

An annoyed reader wrote in this morning with a reasonable request: "Could do some researches on those GOP who are running against bailout and see who voted for the [post-9/11] Airline Bailout in 2001?" The airline bailout, the reader noted, was "the first bailout in the 21st century," and it happened when the GOP controlled quite a bit of the government. So it seems unlikely that Republicans opposed to the measure.

My reader was right: They weren't opposed to the measure. In fact, it was Rep. Don Young, an Alaskan Republican, who introduced the measure. You can see the vote totals here.

Which is only to say that the Republicans don't mind bailing out private industries buffeted by freak events when those events, and the consequences of economic collapse, would happen on their watch. Come to think of it, TARP, which passed under George W. Bush, is an example of this as well. But you never hear about the airline bailout as part of America's creep towards socialism.

This goes back to the axiomatic principle in American politics that politicians only sound like they're arguing about policy. In fact, they're positioning for the next election.

Photo credit: By Antoine Antoniol/Bloomberg

By Ezra Klein  |  June 24, 2010; 12:07 PM ET
 
Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati   Google Buzz   Previous: Want to learn about Senate procedure tomorrow?
Next: Lunch break

Comments

I recall a lot of opposition to the airline bailout, Klein. Of course, much of the nation's alleged press ignored it. If didn't fit their propagandic template.

Here's the Federalist Society:

http://www.fed-soc.org/publications/pubID.111/pub_detail.asp

Posted by: msoja | June 24, 2010 12:26 PM | Report abuse

So the Federalist Society was against it. What about the Republicans who actually were in the House and Senate. Let's check the roll call in the House: Repubs: 201 of 228 voted for it (6 voted against and 11 did not vote); Democrats: 155 voted for it, 46 against, 2 present and 7 did not vote. In the Senate it passed by unanimous consent, at the time the Democrats held 50 seats, the Repubs had 49 and there was one independent. Many of the Repubs who are now arguing against bailouts were in the House and Senate at that time, some of them would have had to vote for the first bailout of the 21st century, just shear numbers dictate that. msoja, why are you such a knee-jerk troll for the anti-dems? Sometimes dems do have good ideas, and sometimes, but not recently, repubs have had good ideas. Let's be honest here, at times bailouts are needed, both for the big guy and the little guy. Or the whole system falls apart. If you want to see true dog-eat-dog capitalism with no state intervention, I would suggest you go to Cambodia. The only roads you have are those paved by private money, hence the only good roads go from private invested enterprises to the ports - and they are paid for by those private invested enterprises; security? hire private security contractors; medical? you have money you get treated, you don't have money, you don't even get into an emergency room; power? buy your own private generator; nothing is funnier to me than walking around the best neighborhood in Phnom Penh, where all the foreigners live, on dirt roads and seeing mansions with beautiful concrete driveways that stop at the road. The perfect capitalist country - if you have capital you live well, if you don't you live in poverty. No social safety net there; no government spending on anything that helps everyone, only government spending on things that attract industries. The exact policies that many are suggesting we need to follow here...

Posted by: s_leisz | June 24, 2010 12:44 PM | Report abuse

"But you never hear about the airline bailout as part of America's creep towards socialism."

Well, you do, sometimes. Because it kinda sorta is. The GOP may have voted for it, but most of the elected Republican politicians aren't opposed to an expanding government, high deficits, or socialism. They are just opposed to the Democratic version of those things.

Whereas Democrats aren't opposed to policies that only help the super-wealthy at the expense of the poor, and aren't opposed it corporate welfare or crafting regulations that are friendly to the super-mega-rich but don't help the middle class. They are only opposed to those things with it's Republican's proposing them (or when attacking them makes a good cudgel to beat Republicans up with).

I didn't support the airline bailout or TARP. Of course, I'm not an elected Republican.

Posted by: Kevin_Willis | June 24, 2010 1:00 PM | Report abuse

Might be useful to recall the two main components of the airline bailout post 9/11.

The first component, a total payout of ~$5 billion, allocated across airlines by passenger shares, was meant to compensate airlines for revenue losses due to the attacks. This component was not unrelated to the War Risk Insurance program for airlines that is administered by the FAA.

The second component was comprised of a total of ~$10 billion in loan guarantees, administered by the Air Transportation Stabilization Board (ATSB) http://www.ustreas.gov/offices/domestic-finance/atsb/ , a newly created entity with 3 seats, one for the Fed, one for the Dept of Treasury and one for the Department of Treasury. The loan guarantees were intended to support restructuring and other financing needs for airlines that could show that the financial market distress and industry weakness caused by the 9/11 attacks limited the ability of the loan guarantee applicant to get financing in private markets independently. In most cases, the US govt received stock warrants in exchange for the loan guarantees, and the govt made money overall on the program, once the warrants were sold or exercised. The entire $10 billion in guarantees was not used, and some large applicants were denied support by the ATSB (in particular, United Airlines).

Posted by: bdballard | June 24, 2010 1:22 PM | Report abuse

Cambodia? You've got to be kidding me.

Like there's no historical context to that thing.

Posted by: msoja | June 24, 2010 1:34 PM | Report abuse

It's fun reading all the pro-Republican spin here and seeing them squirm. :-)

Posted by: Lomillialor | June 24, 2010 1:39 PM | Report abuse

The Federalist Society article referred to above as an example of, presumably, Republican opposition to the airline bailout appeared more than two years after the fact.

Posted by: thehersch | June 24, 2010 2:23 PM | Report abuse

This seems a little odd. While in the main the airline industry has never been well run and has always required fairly heavy government subsidy/protection, the 9/11 events were freakish and the airlines had no culpability.

The bank bailouts constituted a decision to save banks from themselves and their own horrific misjudgments, without exacting much cost from many of the responsible parties.

Of course, none of this is to deny the generally hypocritical stances of politicians of both parties across a whole range of policies. But the bailouts were rather different in kind, no?

Posted by: FrBill1 | June 24, 2010 2:31 PM | Report abuse

spin and squirm.

LOL

spin and squirm.

Posted by: Lomillialor | June 24, 2010 3:10 PM | Report abuse

oh my, just noticed my error! The third ATSB seat went to the Dept of Transportation, rather than 2 seats to Treasury. I sure hope a lot of people didn't read my original comment and get misled or confused!

Posted by: bdballard | June 24, 2010 6:44 PM | Report abuse

--"The Federalist Society article referred to above as an example of, presumably, Republican opposition to the airline bailout appeared more than two years after the fact."--

Yeah, they just whipped it up in retrospect. They had completely different opinions two years earlier.

And obviously, the lack of Republican opposition has already been established.

So, it's hard to tell what your point might be.

Posted by: msoja | June 25, 2010 12:27 AM | Report abuse

Mortgage Loan Modification is the only solution to save your home and stop foreclosure. Some 650,000 troubled borrowers have been put into trial loan modifications under the president's foreclosure rescue plan, the Treasury Department said Tuesday. That number represents only 20% of eligible homeowners. Mortgage Home Modification Program is the solution to save your house and stop foreclosure process Use this free tool to see if you qualify for loan modification http://bit.ly/b8C0iS

Posted by: michelpaul1 | June 25, 2010 4:15 AM | Report abuse

The comments to this entry are closed.

 
 
RSS Feed
Subscribe to The Post

© 2010 The Washington Post Company