If we give bail outs, we should get stock/control. End of story. All bailed out companies should be nationalized to some extent, depending on the value of their stock and how much the government buys.
A board/council of nationally elected representatives should manage whatever share of these companies the government owns.
It's time the citizens started getting a return on their tax dollars if they're being used for private investment.
These companies were shut down under extraordinary circumstances, and the economy also shut down in a very uneven way and for an indefinite time, with another potential shutdown to counter a winter resurgence. About half of Americans are still not under lockdown.
The picture to me is that the country does not consider itself as in the same boat.
a short-term oversight is warranted to get a company reorganized (happens in bankruptcies, for example), but long-term oversight can be detrimental to the best interests of citizens by keeping companies overly constrained from feeling and responding to market conditions.
and as others have noted, the return to citizens of such companies goes beyond its profits, so it's wise not to get to focused just on distributing those profits.
beyond that, let's make sure the shareholders and executives feel the pain of their decisions, so they can adjust for risk in the future. let shareholders take a serious haircut (you can cram them down by creating a large pool of new, unallocated stock) and for execs, take back all incentives beyond a reasonable salary for the past 5 years. you can take that reclaimed incentive and form forward-going incentives the execs can work for again.
> It's time the citizens started getting a return on their tax dollars if they're being used for private investment.
US citizens have already seen massive return on their 2008 bailout. These bailouts aren't free money, they're just loans that get paid back, with interest.
> A board/council of nationally elected representatives should manage whatever share of these companies the government owns
This has succeeded practically zero times in the history of nationalisation. Transitioning a culture from private ownership to public is highly value destroying. And putting electeds in charge of companies goes about as one would expect in terms of venality and competence.
The better strategy is to have a board appointed by elected representatives with a finite term and mandate to return the assets to private ownership.
The pandemic is not their fault, but it is their fault for not being prepared for something like it. It’s even listed as a risk factor in investor disclosures, so it’s not totally unforeseen. An electrical fire can burn your house down through no fault of your own, and that’s why you have homeowner’s insurance. How about keeping cash in reserves instead of doing huge stock buybacks the last 10 years? How about having a plan to wind things down and “hibernate” until the business can be spun back up again? No sympathy for them. No bailout. Let them fold, let them sell the planes so new management can manage them better.
Keeping large cash on hand for highly rare black swan events is a pretty inefficient allocation of capital. If all companies kept enough cash to not earn revenue for months and pay all expenses for a once in a hundred year event, then a significant portion of money in all the U.S. economy would just sit as cash and not be allocated to investment, hiring, etc. Just a counter argument.
Yes, the bailout should've required all flights scheduled during shelter-in-place to be refunded. Millions of consumer dollars tied up in airline credits is a net drag on economic stimulus.
If you were flying to europe they should be reimbursing per EU261. So far its been hit or miss actually getting the refunds with the people I’ve helped.
Its amazing how when the contract of carriage is in the customer’s favor somehow it no longer applies.
Despite not having any information on American Airline's website, I was able to get my money for a cancelled flight last year from Europe to the US (due to technical problems on the plane) by just doing the contact us form and putting in all the info. But of course, they didn't have any of this info listed on their website in a way that told me I needed to do that. The check was mailed on time, and I was actually pretty surprised.
Definitely try to get your money under the EU regulations! It's worth the time.
I don't understand why we can't let them go bankrupt. Presumably at least a couple of the airlines could raise money by selling more stock or getting acquired by somebody like Berkshire. The rest would go through chapter 11 and come out of it being owned by somebody else. We could use the 2 trillion to support the employees.
What you're missing is that both political parties in the states are beholden to capital interests, and so the reason "we" can't let them go bankrupt is it would work against those interests. This isn't a conspiracy theory, there don't even need to be conspirators for it to work this way. With very few exceptions you are only capable of getting elected if you believe in the supremacy of the needs of capital. The only thing that can really stand against this is a strong organized worker's movement, which has been systematically dismantled over the past 70 years.
That article does not conclusively show the taxpayer benefited from the bailout. All it shows is that the stock price went up. If the money is then used to subsidize airlines, telecom companies, etc. and ultimately used for stock buybacks, exec bonuses, etc. then the taxpayer is never seeing any of that money.
As much as I'd love to pile on to this question, HN isn't a place for general political arguments, and this isn't a productive discussion for this site.
The airline industry needs to be resized as well as bailed out.
Business travel will be permanently impacted by the shift to digital communications that is being forced upon business now.
Leisure travel will not come back until there is a Covid-19 vaccine, which is 12 to 18 months at least. Even then, higher ticket prices due to the lack of the more profitable business travelers, combined with a lack of consumer expendable income, will curtail demand for another year or two.
Maybe so, but please don't post unsubstantive comments (like mechanical tropes) to HN. They lead to predictable and therefore tedious and therefore off-topic, generic discussion.
What do you mean by "privatize the profits" here? Are you ignoring taxation?
One way to view the government's role here is that it shifts around externalities to achieve efficiency. You can put cap-and-trade restrictions to absorb negative externalize in high-pollution industries and redistribute that to consumer/producer markets that suffer from the pollution.
You can probably apply a similar piece of reasoning across time. Government can tax industries during booms and then redistribute that during busts.
[+] [-] orthecreedence|6 years ago|reply
A board/council of nationally elected representatives should manage whatever share of these companies the government owns.
It's time the citizens started getting a return on their tax dollars if they're being used for private investment.
[+] [-] uncletammy|6 years ago|reply
I want voting shares issued directly to me in an amount equal to my financial contribution (tax dollars / currency devaluation) towards their bailout.
[+] [-] threatofrain|6 years ago|reply
The picture to me is that the country does not consider itself as in the same boat.
[+] [-] rdiddly|6 years ago|reply
[+] [-] dionian|6 years ago|reply
[+] [-] T-hawk|6 years ago|reply
The one comparable I can think of in the US is Amtrak, which is functional although not exactly wildly successful.
[+] [-] SubiculumCode|6 years ago|reply
[+] [-] clairity|6 years ago|reply
and as others have noted, the return to citizens of such companies goes beyond its profits, so it's wise not to get to focused just on distributing those profits.
beyond that, let's make sure the shareholders and executives feel the pain of their decisions, so they can adjust for risk in the future. let shareholders take a serious haircut (you can cram them down by creating a large pool of new, unallocated stock) and for execs, take back all incentives beyond a reasonable salary for the past 5 years. you can take that reclaimed incentive and form forward-going incentives the execs can work for again.
[+] [-] golergka|6 years ago|reply
US citizens have already seen massive return on their 2008 bailout. These bailouts aren't free money, they're just loans that get paid back, with interest.
[+] [-] JumpCrisscross|6 years ago|reply
This has succeeded practically zero times in the history of nationalisation. Transitioning a culture from private ownership to public is highly value destroying. And putting electeds in charge of companies goes about as one would expect in terms of venality and competence.
The better strategy is to have a board appointed by elected representatives with a finite term and mandate to return the assets to private ownership.
[+] [-] wdr1|6 years ago|reply
[+] [-] steve76|6 years ago|reply
[deleted]
[+] [-] dominotw|6 years ago|reply
Is there an example of nationalized company that operates in free market and still manages to turn a profit for the investors(citizens).
I wouldn't make an investment in usps or amtrak as a citizen with profit motive as a tax payer.
[+] [-] jliptzin|6 years ago|reply
[+] [-] wpasc|6 years ago|reply
[+] [-] caseyf7|6 years ago|reply
[+] [-] jdsully|6 years ago|reply
Its amazing how when the contract of carriage is in the customer’s favor somehow it no longer applies.
[+] [-] cbanek|6 years ago|reply
Definitely try to get your money under the EU regulations! It's worth the time.
[+] [-] aczerepinski|6 years ago|reply
What am I missing?
[+] [-] ahelwer|6 years ago|reply
[+] [-] godzillabrennus|6 years ago|reply
https://money.usnews.com/investing/articles/2017-01-19/finan...
We should still have seen banksters going to jail over their clearly crooked and irresponsible behavior.
[+] [-] viklove|6 years ago|reply
[+] [-] llampx|6 years ago|reply
[+] [-] macintux|6 years ago|reply
[+] [-] lonelappde|6 years ago|reply
So far we've got $1200 checks going to all the little guys and $500 to their little children.
[+] [-] tyingq|6 years ago|reply
[+] [-] Merrill|6 years ago|reply
Business travel will be permanently impacted by the shift to digital communications that is being forced upon business now.
Leisure travel will not come back until there is a Covid-19 vaccine, which is 12 to 18 months at least. Even then, higher ticket prices due to the lack of the more profitable business travelers, combined with a lack of consumer expendable income, will curtail demand for another year or two.
[+] [-] iso1210|6 years ago|reply
[+] [-] dang|6 years ago|reply
We detached this subthread from https://news.ycombinator.com/item?id=22712653.
[+] [-] hkmurakami|6 years ago|reply
[+] [-] xkvd|6 years ago|reply
One way to view the government's role here is that it shifts around externalities to achieve efficiency. You can put cap-and-trade restrictions to absorb negative externalize in high-pollution industries and redistribute that to consumer/producer markets that suffer from the pollution.
You can probably apply a similar piece of reasoning across time. Government can tax industries during booms and then redistribute that during busts.
[+] [-] throwawaymanbot|6 years ago|reply
[deleted]
[+] [-] Reedx|6 years ago|reply
[+] [-] pgsbathhouse2|6 years ago|reply
Just the executive branch, which was elected by a certain segment of our society.
Thankfully (hopefully) it only lasts 4 years, and not 20.