Canary in the Coal Mine – Airlines

Posted: June 21st, 2009 by: h2

Just a quick note, keeping in mind that we live in an allegedly globalized world, which will allegedly prove more efficient etc. That’s all nonsense of course, globalization is all about corporations moving responsibilities and liabilities (such as environmental concerns, labor costs, and so on) to where they can generate the highest short term rates of return while generating the greatest possible social disruption and global destruction in the process.

So it strikes me, what is the first thing to go when this system starts to crack due to rising resource costs and peaked production levels of key resources, like oil? Airlines, of course. So it’s not surprising to see, after a disastrous last year, that World’s airlines in fight for survival (with 9 billion US dollars in losses this past year).

Faced with their biggest crisis in history, airlines from throughout the world gathered in Kuala Lumpur to take stock and swap survival strategies.

“Numbers can tell powerful stories,” International Air Transport Association director-general Giovanni Bisignani told his audience of 500 airline representatives at their annual summit.

Airlines are expected to collectively lose US$9 billion (NZ$14b) this year as falling demand, lower yields, broken consumer confidence and the swine flu pandemic threaten to wipe out US$80b in revenue.

Those losses will come on top of last year’s US$10.4b deficit thanks to the double hit from record high fuel prices and the collapse of the world economy.

“The ground shifted and our industry was shaken,” Mr Bisignani says.

Airlines are in survival mode and in desperate need of help to see them through the crisis and allow them to emerge with a business model that delivers a financially sustainable future.

Yep. Can you say: (re)nationalized airlines? In fact, can you say: the only countries that will have any chance of controlling the bumpy downhill slide are going to be the ones where the state controls resource allocation and pricing? Watch the ‘free market’, one of the greatest pieces of nonsense ever generated as a concept in human history, start to show more and more how pathetically unable it is to actually do anything other than serve as an excuse to funnel more money to the hands of those who control it.

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