U.S. airlines accused of hypocrisy in subsidy debate

A report unearthed by Wikileaks says U.S. airlines benefited from $155 billion in government aid

The war of words between three state-owned Persian Gulf airlines and three major U.S. carriers has turned into a war of numbers.

American, Delta and United airlines have complained that Etihad, Emirates and Qatar Airways have an unfair advantage when competing against U.S. airlines because they have received as much as $42 billion in subsidies over the last decade from their owners, the oil-rich United Arab Emirates and the Qatar government.

The U.S. carriers have asked federal officials to renegotiate a so-called Open Skies agreement that allows foreign carriers access to U.S. markets.

But now a congressional report has surfaced that says the U.S. airline industry benefited from $155 billion in support from the U.S. government from 1918 to 1999.

The money came in the form of federal subsidies to serve outlying markets, loan guarantees to purchase new aircraft and investments in runways, control towers and radar systems, according to the previously unpublished report, which was unearthed by Wikileaks in 2009.

The Business Travel Coalition, an advocacy group for business travel managers, and the U.S. Travel Assn. point to the congressional report as evidence of hypocrisy by the U.S. airlines.

“The big three U.S. airlines have constructed themselves an enormous glass house,” U.S. Travel Assn. spokesman Jonathan Grella said in a statement.

Representatives for the U.S. airlines have fired back, saying the funding from the U.S. government to build control towers and runways is not the same as the interest-free government loans, grants and exemption from government fees received by the Persian Gulf carriers.

“It is laughable that a two-decade-old unpublished paper examining U.S. aviation since 1918 is being trumpeted as evidence that U.S. airlines are supported the way that the United Arab Emirates and Qatar routinely subsidize their airlines,” said Jill Zuckman, a spokeswoman for the U.S. airlines and their supporters.

To read more about travel, tourism and the airline industry, follow me on Twitter at @hugomartin.

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