Originally Posted by
Tchiowa
And the US laws are designed to protect tax and payroll first. That's what it means to protect against creditors. You owe my company money and you go into Chapter 11, employee and the government get protected before I do. I'm a creditor. I'm last. That's why I'm willing to negotiate a restructuring of debt and keep the company alive. Otherwise I get nothing.
You fundamentally misunderstand IMO. In "most western countries" bankruptcy laws are generally designed to wind up the company, protecting tax and payroll first. That's explicitly not the case in US Chapter 11 which is specifically designed to allow the company to continue by shedding debt through a court/government approved method.
In most other countries the receivers (the court appointed managers who take over the company to wind it up) may see a way to save the company and that may include trying to renegotiate debts, but that's seldom the way it happens. The US is (almost (I know of one other country that has broadly similar laws)) unique in allowing companies to reorganize and simply shed/renegotiate debt, in allowing the current managers to remain in place while they (having run the company to bankruptcy in the first place) apply very generous rules to get themselves out of the situation.
Just to drag this back towards topic, I'm of the opinion that the ME carriers are playing a very careful game within the rules. They don't get subsidies. They do, as they say, get capital investments, just as US carriers do - only it's government money going in, which is neither here nor there IMO. US carriers, however, do get similar (& IMO greater) benefits in that the tax laws are written in a way that they can avoid most, if not all, US tax. I don't see how the subsidy is dressed up really matters. US carriers wouldn't survive a genuinely free market and they know it. It's why no US carrier is genuinely competitive globally: they have the power/rights/potential to do exactly what the ME carriers are trying. They don't because they know they'd fail.