This NY Times article gives a good overview on the state of United Airlines, which continue to flounder in a chapter 11 case filed in December 2002. As the story relates, United’s emergence from chapter 11 is based upon the Air Transportation Stabilization Board‘s expected approval of United’s application for $1.6 billion in federal loan guarantees that will allow United to raise the capital necessary to fund its reorganization plan and post-bankruptcy operations.
Quare: Why is the federal government in the business of providing credit enhancements for an industry that, as Warren Buffett pointed out several years ago, if one tabulates all of the airline industry’s finances since the day the Wright Brothers in 1903, one would discover that, cumulatively, there has not been a single penny of profit? (Mr. Buffett has also suggested famously that, in hindsight, shooting down the Wright Brothers on that beach would have been a reasonable financial, if not moral, move).
I know what Professor Ribstein‘s answer would be. Update: I was right!
Houston's Clear Thinkers
Longtime Houston attorney Tom Kirkendall's observations on developments in law, business, medicine, culture, sports, and other matters of general interest to the Houston business, professional, and academic communities.
They don’t shoot airlines, do they?
Houston’s Clear Thinkers has a comment on the NY Times’ report on the struggles of United Airlines somehow reminded me of Horace McCoy’s 1935 novel and the 1969 film of depression-era marathon dancers gasping and staggering to their deaths
They don’t shoot airlines, do they?
Houston’s Clear Thinkers’ comment on the NY Times’ report on the struggles of United Airlines somehow reminded me of Horace McCoy’s 1935 novel and the 1969 film of depression-era marathon dancers gasping and staggering to their deaths for pennies