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Nationalize The Airlines
The U.S. Government should nationalize private airlines into a state-run United States Airline Corporation.
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Socialism is often radical. The term “Revolution” is used literally and figuratively, and left organizations, politicians, and activists have serious policy plans that involve significant changes to the economic and social status quo (such as my case for The American Workers’ Bank).
And while drastic change is often necessary, The Left would benefit by championing the less-radical, legislatively possible tenets of our ideology. Though seldom glorious, these policies would simply make life better for Americans. Higher quality of life is a good on its own, but would also have secondary benefits, such as courting voters, reducing greenhouse gas emissions, and curtailing rampant profiteering.
One such policy is a national, state-owned airline. We’ll call it The United States Airline Corporation.
What is the Goal of a State-Owned Airline?
The primary goal is to help Americans move around the country as pleasantly and at as low-cost as possible. Just as cities and states have public buses and trains, the United States should have a public airline. Private air travel is clearly suboptimal. It’s notoriously expensive, uncomfortable, and contributes unnecessary greenhouse gas emissions.
All these negatives stem from the same source. As the economist and Chilean Fascist Enabler Milton Friedman said in his 1970 NYT essay The Friedman Doctrine, “the social responsibility of a business is to increase profits.” Like it or not, Friedman is right. This is the guiding principle of all corporations — it’s why airlines are willing to kill the planet to keep gate spots, and the reason expired peanuts cost you $27 on Spirit Airlines.
As an alternative to private businesses, governments can enter the economy with a mission of promoting the public good, not profits. That is why I believe the United States government should run an airline that puts profit behind the goal of transporting Americans as pleasantly, eco-friendly, and frugally as possible.
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How will the US Create an Airline?
First, Congress will need to charter a state-owned enterprise (SOE) to create and oversee the operations of this national airline. SOEs are corporations where a government has the full or controlling share. The U.S. has numerous SOEs in industries ranging from agriculture, to wildlife preservation, to prisons, so this isn’t a novel process. We’ll call this hypothetical corporation the United States Airline Company (USAC). The best template for the USAC is Amtrak, which oversees the nation’s public rail service. (Ideally, these two corporations would eventually merge. More on that later.)
Once the corporation is established, there are two simultaneous ways to create a national airline:
1. Build one.
2. Nationalize existing private airlines.
#1 is simple. The USAC would purchase airplanes from manufacturers, hire flight and ground crews, and operate the airline just like any other. Passengers would be able to purchase tickets online, go to the airport, and fly to their destination.
For #2, USAC could either purchase publicly traded airlines (more on that later) or wait until the air travel industry (inevitably) needs another bailout, which has already happened twice this century.
Following 9/11, Bush bailed out the industry with $18.6 billion under the Air Transportation & Stabilization Act. And when the pandemic hit, the airlines received another $54 billion as part of the government’s Payroll Support Program, with the requirement that only 26.2% of it be repaid. In short, taxpayers gave these companies $40 billion dollars. In the words of American Airlines CEO Doug Parker: “It’s not an exaggeration to say the program saved the industry.”
If in both 2001 and 2021, the Government had purchased airline equity instead of handing money to the owners, the state would’ve acquired significant equity on behalf of the American people. That equity could’ve been the foundation of The United States Airline Corporation, a superior outcome for Americans than the continuous cycle of charity-for-capitalists.
While we wait for the next financial disaster, USAC could purchase publicly traded airline stock and force a merger upon achieving a controlling share. Below are the market caps (the total value of issued stocks) of the four leading airlines operating in the United States.
Delta: $25.31 billion
American Airlines: $11.27 billion
Southwest: $26.44 billion
United Airlines: $14.48 billion
While these values may sound gargantuan, consider that the government gave this industry $72.6 billion between 2001 and 2021. That’s just $4.9 billion shy of the sum of the market cap of ALL FOUR of these major airlines.
So, instead of bailing out these for-profit companies twice, the United States could’ve diverted $5 billion from the Pentagon’s budget, purchased all four of these airlines, and merged them into a democratically accountable United States Airline that operated for the good of the people and the environment, not for profits.
The Bigger Picture
There are two reasons the U.S. state should control its air travel:
1. Americans should be able to traverse their country as easily, frugally, and comfortably as possible. (Even the staunchest capitalist can’t defend private air travel as “easy, frugal, and comfortable” with a straight face.)
2. Air travel is disastrous for the environment (contributing 2.5% of CO2 emissions) and will need to be significantly curtailed to mitigate climate catastrophe.
Only democratic control of air travel will solve these problems. Ideally, the United States Airline Corporation will be one part of a state-run transportation regime that gradually brings transportation under democratic control. The U.S. is decades behind other wealthy nations in high-speed rail, a much more climate-friendly (and in my opinion, enjoyable) way to travel. A country-wide high-speed rail network should be constructed alongside the USAC’s consolidation of air travel. Once both are in place, we can increase rail travel as we decrease air travel, preserving the environment and improving the experience.
(If there is a New Cold War, we’re losing it.)
Ideally, the distant future will see the majority of transportation, from public buses, to car manufacturing, to the Lime scooters that are impossible to look cool on, provided by the state. I’m not an advocate for a completely planned economy (at least in modernity), but I do believe that the necessities of life — food, shelter, water, transportation, education — have largely been failed by markets. Markets work when consumers have the choice to enter them. If consumers don’t have a choice (i.e., traveling to work or moving cross-country for a job), then the market isn’t “free” — it’s coercive.
Additionally, democratic, eco-friendly travel will just make life better. We’ll be able to visit our families, go on vacation, and see our beautiful country without fear of ruining the planet or getting dragged off an overbooked plane like a drunk white girl getting removed from a nightclub.
What do you think about my case for a United States Airline Corporation? Let me know in the comments below. And don’t forget to subscribe and share this article to help JoeWrote grow.
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