Infinite Unknown

Industry officials and analysts urge Washington to act to avert a collapse.

New York - America’s aviation system could be at risk of collapsing by the beginning of next year.

That warning from aviation experts has prompted some industry leaders to call for re-regulation, something considered almost heresy until now. Others are urging Washington to do more to rein in the oil speculators pushing up fuel costs.

But there is agreement among airline officials and analysts that Washington and the two presidential candidates need to recognize the severity of the crisis and take some action now to avert an economically crippling collapse in the near future.

“Unless something is done to move toward some kind of fix, we’re going to see every one of our major airlines in bankruptcy,” says Robert Crandall, former chairman of American Airlines. “If that isn’t enough of a crisis to alert everybody, then I don’t know what it will take.”

As a result of the spike upward in oil prices, almost every major airline is now losing millions of dollars each quarter.

Unless the price of oil comes down, most are expected to run out of cash by the end of this year or the beginning of next. In a bid to stave off bankruptcy, they’re already retrenching. They plan to lay off an estimated 25,000 employees, park hundreds of planes, and cut the number of flights they offer.

In addition, a recent study by the Business Travel Coalition, which represents corporate travel managers, estimates that 100 regional and 50 major airports nationwide will lose some of or all their air service by the end of the year.

“I’ve been trying to turn on the emergency sirens to raise awareness in Washington and back home,” says Kevin Mitchell, chairman of the Business Travel Coalition in Radnor, Pa. “And I think people are finally beginning to [wake up].”

Airline officials visit Washington

Representatives of the major carriers were in Congress this week, urging action to discourage speculation in the oil markets. Some analysts blame that speculation for the almost doubling of the price of jet fuel in the past year.

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Tags: airlines, American Airlines, bankruptcy, Oil, Oil Prices, Unemployment

The tax provisions of the Foreclosure Prevention Act, which consumer groups and labor leaders say amount to government handouts to big business, show how the credit crisis, while rattling the housing and financial markets, has created beneficiaries in the power corridors of Washington.

It also shows how legislation with a populist imperative offers a chance for lobbyists to press their clients’ interests.

This has proved especially true on the housing legislation, which many lawmakers and lobbyists view as one of the last opportunities before Congress grinds to a halt amid election-year politics.

In the Senate bill, the nation’s biggest home builders, some now on the verge of bankruptcy, won a provision that would let them claim millions in tax refunds by charging their current losses against the huge profits they made three or four years ago. Other struggling industries would benefit from this provision.

Sen. Christopher J. Dodd, Democrat of Connecticut, was the main author of the Senate bill meant to help homeowners.

(The ones who will really benefit from this are, like always, the corporations.
And guess who will pay for these tax breaks in the end? - The Infinite Unknown)

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Tags: airlines, American Airlines, automakers, bill, Businesses, corporations, Economy, financial market, Ford, Foreclosures, General Motors, Goodyear Tire, Housing Bill, Lobbyists, Northwest Airlines, Rubber., Senate, Tax Breaks, tax provisions, Wall Street, Washington