Vote with your dollars: US commercial carriers v. Mideast government airlines

As Americans, we have the right to decide where and how we spend our hard-earned dollars, but as consumers, we have a responsibility to make informed decisions on what we support with our purchases. As the old adage goes, “your dollar is your vote.”  When it comes to choosing an airline, do you know what you’re voting for? 

Imagine if a U.S. airline absorbed all of its major domestic competitors, as well as the country’s largest petroleum company, received substantial funding from the American government, controlled the Federal Aviation Administration (FAA) and was legally permitted to fire employees based on age, appearance, gender, or sexual orientation.

{mosads}Alarmingly, the scenario described above is the reality for three Persian Gulf airlines – Qatar, Etihad and Emirates Airline – all of them operating within the United States.  

The Middle Eastern countries, where these airlines are based, all signed Open Skies agreements with the United States in 1999. The agreements provided unprecedented access to our markets in exchange for fair competition, free from government intervention.

A new poll shows 73 percent of Dallas voters believe the U.S. government should take action and end the Gulf’s violations.

And it appears the people of Dallas are right. Article 12 of the Open Skies agreements prohibits: “prices that are artificially low due to direct or indirect governmental subsidy or support.” By receiving tens of billions of dollars in state subsidies, these Persian Gulf carriers are blatantly violating these bilateral agreements.

We must remember that Qatar and the United Arab Emirates are key strategic allies, with whom the United States collaborates on a broad range of mutual interests and shared objectives. However, on this issue, the evidence is clear: these agreement violations take a toll on our nation’s economy and hurt American jobs, every day.  

In fact, every lost international roundtrip route by U.S. carriers, because of this subsidized competition, equals a net loss of 821 U.S. jobs.

To add further insult to injury, Qatar, Etihad and Emirates Airline all operate under outrageously outdated labor policies or practices. These airlines are able to reduce overhead costs by lowering employee wages, benefits, and working conditions, thereby unfairly undercutting American competitors.

Every American commercial airline lives and dies by the consumer market – not these three Gulf carriers. Instead, they’re born, sustained, and grown by their governments, enjoying the luxury of doing business in America, not out of economic necessity, but as a means of paralyzing the invisible hand that guides our free market.

These three carriers’ routes to our country have not meaningfully increased passenger traffic; they only serve to displace U.S. airline market share and shift American jobs overseas.

These Gulf’s massive national subsidies – $40 billion in just the last 10 years – have allowed these Middle Eastern airlines to rapidly expand their fleets and international routes, including routes into the U.S.  In fact, Emirates Airline has just taken delivery of 60 Airbus A380 Superjumbos, each with a price tag of $500 million, with an additional 80 on the way.   

These three Middle Eastern airlines are clearly targeting the U.S. market. If these practices continue, U.S. carriers may have to downsize their operations, close smaller airports that families and entrepreneurs rely on, and provide fewer contracts to small businesses, a segment of our economy that is responsible for creating two-thirds of all American jobs.

Conversely, U.S. carriers drive nearly $1.5 trillion in economic activity, and support more than 11 million American jobs. The industry continues to explore lawful and strategic partnerships to increase their competitiveness – for example, contracting millions of dollars with small, minority-owned businesses each year. In doing so, U.S. carriers infuse diverse communities with new capital to help drive upward mobility, while simultaneously garnering consumer loyalty within those communities. 

The United States Hispanic Chamber of Commerce (USHCC) is proud to have a particularly strong relationship with one of those carriers: American Airlines, a company that has been named as a top company for Hispanics numerous times by Hispanic Business magazine, thanks to its strong commitment to diversity in its hiring, community outreach, and supplier contracts.

As president and CEO of the USHCC, which represents 3.2 million Hispanic-owned businesses nationwide, I am deeply concerned about the immediate threat of these unfair practices executed by Middle Eastern carriers.

Our association stands with American Airlines, along with United Airlines, Delta Air Lines and more than a half-dozen airline industry labor unions, in urging the U.S. government to open consultations with Qatar and the United Arab Emirates to address these ongoing concerns. The consequences of failing to address the unfair competition by the government-subsidized Gulf airlines are simply too steep to ignore. 

In the final analysis, U.S. commercial carriers are being forced to unfairly compete with a nationalized, aviation-industrial complex.  These violations are more than a breach of an agreement; they fundamentally undermine the principles of our free market economy that sustain small businesses, connect communities, and allow workers to serve with dignity. 

So, how will you cast your vote?

Palomarez is president and CEO of the United States Hispanic Chamber of Commerce (USHCC).