Airlines to lose more money than the government

Articles like this bother me. The airline industry is putting out dire warnings about the consequences of a new war in Iraq. They're claiming that a war, coupled with a terrorist attack like 9/11 could lead to $13 billion in losses and 100,000 layoffs.

All that may be true, but what happens if we have a war in Iraq, a terrorist attack like 9/11 and a war in Korea? Or if instead of a new Korean war, a 747 crashes on approach in bad weather? Or what if we only have a war in Iraq and it's over in a week? Then what?

Reports like this are fear mongering, pure and simple. The liquidation of Eastern Airlines and Pan American were not because of the first Gulf war. They were the results of decades of incredibly inept management. Get the book Hard Landing for a more in depth look at why Eastern and Pan Am failed. There is no positive evidence that any of their assumptions will happen, war included. Right now it is all hypotheticals. This article is designed to build public support for more government money.

I'm also bothered by the next to last paragraph in the story. In that paragraph the airlines contribute $4.1 billion of their $10 billion loss to costs for additional security. But part of that $4.1 billion was actually the $2.50 government imposed security surcharge! The airlines didn't lose that money; it was never theirs to begin with!

Fear mongering articles like this are a short-term band aid. They will not fix the mistakes of years of mismanagement. They will not help to make the airlines more efficient or to bring passenger back. And ultimately they will backfire as the public catches on to the deception.