AP2001,

The tax-related "offset" does little good when a firm is bleeding money -- like most all US carriers. The airlines may be getting a tax deduction, but right now all it is doing is building up the net operating losses that are worth pennies at best unless acquired by a profitable firm -- and then those NOLs are worth nothing more than a few nickles. Perhaps some of the accounting types on the board can elaborate on why what you mention as writing off their taxes is not worth much in the current environment. Those seats are worth more than the write-off. If the government wants to give a tax credit and plow full fare money for each seat taken by FAMs, then the airlines would not be balking; instead airlines and their shareholders would be crying for more FAMs.