US Will Take UAE and Qatar to Task Over Subsidies

The U.S. is going to enter talks with the UAE and Qatar about airline subsidies but it doesn’t sound like they’ll amount to much.

  • The State Department will “discuss allegations that the Persian Gulf nations have spent billions of dollars subsidizing their state-sponsored airlines”

  • They “will seek commitments to financial transparency” which of course will be forthcoming

  • The U.S. will also “inquire about” perfectly legal plans to add flights between Europe and the U.S. like Emirates service from Milan and Athens to New York

  • Finally they will “push the Persian Gulf countries to keep an arm’s-length approach toward their carriers”

There’s no bluster just soft language. And it’s being handled at the level of an intern the U.S. State Department’s Acting Deputy Assistant Secretary for Transportation Affairs. Because subsidies do not violate treaties the Open Skies treaties the US has signed, indeed the treaty section in each agreement on ‘fair competition’ is about reducing government barriers to the other country’s ability to fly, not imposing barriers as Delta, United, and American have lobbied for. In fact that’s why these talks will “take place outside of formal “open skies” agreements.”

The Obama Administation took a similar approach and decided there wasn’t any here here. Nonetheless regardless of whether formal steps are taken by the U.S. government heavily subsidized U.S. airlines have effectively won given the pullback from the U.S. market by some of their adversaries and slowed growth plans of others.

The irony of complaining that other airlines were too intertwined with governments always seemed lost on United, who lost a CEO over a scandal involving the airline bribing a government official. Or Delta’s CEO who started all of this going on to run heavily subsidized Amtrak.

Copyright: idealphotographer

And in the end it all rebounds to the benefit of Delta, who outfoxed American Airlines into giving up partnerships that allowed the world’s largest airline reach into India, Pakistan and the surrounding region while stealing away India’s Jet Airways as a partner for itself.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. nothing will come out of this since more jobs will be lost if the ME3 are curtailed, than any that the garbagge US3 will create
    this is about them earning even more millions ad not about creating US jobs like the fake delta ¨´we are here primarily for your safety so don´’t expect service from any of our mafia union members¨stewardess claims…
    Of course IAHPHX will disagree, but that is understandable as his job is to bring better liquor to parker
    even this deplorable government will not jeopardize the political relations with the ME3 countries, the fedex and boeing jobs on the line, and more, but they are just throwing a pacifier to the US3 cry babies

  2. It’s time to label things correctly. Subsidies are different from ownership. ME3 use govt ownership to advantage. US3 use govt subsidies to advantage. While similar in effect they’re different by definition.

  3. @billiken
    of course not, that would be considered blasphemy at delta…..
    those are fine….. because they are on the right team…..
    please be patient, IAHPHX will shortly come up with some made up BS to explain to you the difference

  4. Digressing quite a bit here, but I couldn’t help noticing the Department of Transport (as quoted by you) refers o he body of water in the Middle East by its true name as “Persian Gulf”. I am not sure why you and many other bloggers keep referring to it as “The Gulf”? A quick check of geography books we all had to study in school confirms the name as “Persian Gulf”*.

    * Well, that is geography books in all countries who have any respect to most modern international treaties, documents and maps.

  5. @Hossein it’s a colloquialism. It’s commonly understood that when one refers to The Gulf, it’s the Persian Gulf that is being referred to.

    Anyways, Dumpy will simply trot out the “Obama wasn’t tough enough to stand up to the Muslims” and “Make America Great Again” and his brain-dead zombie bootlickers will cheer this on.

    Also: what are the chances the UAE and Qatar will actually sit down with the USSD and listen to this garbage?

  6. I love how Delta (and the other legacy carriers) claim that these practices are bad for the US economy and are taking jobs away from Americans…..

    ….and then turn around and buy 100 Airbus planes instead of buying locally from Boeing.

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