March 17, 2020
Evaluating Assistance to the Airlines
The United States has a vested interest in preserving robust air-freight infrastructure, and passenger airlines serve an important role as they carry a significant amount of the nation’s air cargo. With individual air travel declining as a result of the coronavirus pandemic, the airline industry will be dramatically impacted. AAF’s Director of Fiscal Policy Gordon Gray points to the 2001 Air Transportation Safety and System Stabilization Act, which Congress passed in the wake of 9/11 to support the airlines, as a useful model for how to support the country’s airline industry.
His key points:
- Passenger airlines ferry as much as a quarter of the nation’s air cargo;
- After 9/11 the federal government provided nearly $7 billion in grants and loan-guarantee disbursements to airlines, and in response to current and future losses due to the coronavirus, the nation’s airlines have requested assistance approaching $100 billion in grants, loan guarantees, and foregone tax payments; and
- Providing taxpayer assistance to private entities is a fraught business, but one that crisis may require, and Congress’s response after 9/11 provides a useful model for how.