A shutdown has an impact
Last week, Delta CEO Richard Anderson made the comment that there was no apparent effect from the government shutdown on airline business. While the effect was not immediate, I truly think we’re going to see some down times (again) for the airlines in this country.
Economic uncertainty leads people to defer purchases, travel and seek alternatives to face to face meetings in business. We have seen this time and time again. Corporate America’s reaction to the 2008/2009 economic crisis shouldn’t be forgotten by now but it seems to be.
The shutdown introduces uncertainty about our future. Economies aren’t just driven by the stock price on Wall Street or the unemployment numbers calculated by the government. They are a kind of living, breathing creature.
And not a smart creature either. Economies tend to be dumb and emotionally reactive. They are not nuanced and subtle and they do not act with patience. One would like to think that they reflect the whole of those participating in them but they don’t. They just don’t.
So, when uncertainty from a government shutdown is combined with the uncertainty and growing fear that a failure to raise a debt ceiling introduces, I do worry for the industry.
Creatures that are kind of dumb and reactive don’t do well when Congressmen who are veterinarians by trade start making statements that they have “read a lot” about the economy and believe that “nothing will happen” if the nation defaults on its debt.
No, it isn’t emotionally upsetting to anyone when the most financially strong country in the entire world defaults on its debt.
Anyone who wants to vote Congressman Ted Yoho out of office for saying things too stupid for Congressmen to say is welcome by me. The alternative is that Florida should get exactly what it asked for in electing such person to that office. Your choice, Florida. Make it soon.
Congressman Ted Yoho – He’s read about economy and knows what’s best for the United States photo from Wikipedia
Business travel is one of those expenses companies very quickly act to restrain when uncertainty or hard times come about. You can bet that CFOs and CEOs are already instructing people within their company to curtail expenses, especially travel.
Because in times of uncertainty, it’s best to hold on to what you have as tightly as possible.
The political stalemate over the shutdown and the debt ceiling is going to be the undoing of 2014 for the United States left to continue much longer. Whether you approve or disapprove of the Affordable Healthcare Act or not, that piece of legislation was not the law to fight over and put our country at risk.
I personally think that there are far greater issues that could have been debated over than whether or not greater healthcare coverage for all in this country was a good or bad idea.
I also think that the failure to acknowledge that a great deal of our debt resulted from an economic crisis of global proportions and which originated from a fundamental failure to properly oversee and regulate financial markets is egregious on the part of both houses of Congress.
What happened in 2008/2009 wasn’t ordinary by any stretch. Entire industries which are huge i this country were literally at stake. Extraordinary times have extraordinary consequences that take time to get past.
It’s beneath the dignity of this country to threaten shutdowns that hurts its businesses and citizens and it’s beneath the dignity of this country to threaten default on debt simply to force a change in a law.
well stated and true. airlines, as you know, are notorious for going through crisis after crisis. what can be a banner year can often turn into a loss very quickly just by one or two events. maybe, this will be good for our merger. as a us airways employee, i’ve been on this roller coaster since 1989. and it AIN’T FUN. when i hear the anti-merger ‘experts’ crow about how well AA and US are doing financially, i want to absolutely throttle each and every one of them. do they not see that in one single event, thousands of employees can be shed, aircraft parked, and hubs shrunk or dismantled? why do we have to wait for a complete and total meltdown of the industry for them to say, ”well, okay, perhaps you guys can merge after all”. why not do it in a time when things look stable, and then get things underway to weather the next storm? i do not understand that. so here is my message to the DOJ and that court appointee who stated we do not need to see any documents for ‘discovery’…… ” let us get on with the merger so that maybe, just maybe, some of us can feel a little more secure in our futures here. now is NOT the time to stick your fingers in things and screw it up. and let us see those documents you are hiding. it’s DISCOVERY for gods sake!!!! you know they will get leaked eventually, so just cooperate. ”
LET US MERGER DAMMIT!!!