Originally Posted by
AC7E7
Either way, I feel AC gave up too much. I'm sure they could have survived on their own with a smaller bailout package. There are other ways the feds could have helped all airlines equally, such as lower airport rents (and lower landing fees), lower air traffic control fees, cut the carbon tax on fuel, etc.
To me, this just ushers in the return to the old Air Canada (MapleFlot).
Everything you said is a good argument against government ownership stakes in private businesses that carry governance rights (I agree with you!), but my point was only that the investment decision should be made independently from the patronage decision.
Having said that, the statement that AC could have survived on a smaller bailout package isn't really important. While it's possible that the government showed AC a menu of bailout options from small to extra large, I highly doubt it - it's very likely this was the only option. In all cases when you take government aid, there's likely to be some distasteful component to you, but if you believe it's in your best interest on balance, you do it. Clearly, AC management thought it was in their best interest to do so. The only other explanation is that the government made them take it, and if that's the case, then all arguments about this bailout package instituting some new form of government interference in private markets appear off the mark...