9/11 Airline Bailout: So, Who Got What?
December 9, 2002
A week after the Sept. 11 attacks shook the country
and its air transportation system to the core, executives from
America's big airlines went to Washington looking for help.
"Almost no airline is strong enough to survive for
long, facing the upcoming challenges," Delta Airlines CEO Leo
Mullin said at the time.
Propelled by such dire predictions and the airlines'
considerable lobbying clout, Congress, over the course of just two
days, introduced, passed, and got presidential approval for a $15
billion bailout. Of that sum, $5 billion was earmarked for direct
payments to stabilize the nation's air transportation system.
Like many Americans, Frank Roman assumed that money
was meant to keep passenger planes aloft. But as CBS News
Correspondent Cynthia Bowers reports, then he found out his former
employer and current competitor in the freight forwarding business
- a company that doesn't even own airplanes - received nearly $10
million.
"I thought this was supposed to keep the airlines
flying," says Roman.
While two-thirds of the money doled out by the
Department of Transportation did go to the major carriers, hundreds
of millions more went to places you wouldn't expect.
"It was a massive boondoggle," says Republican
Illinois Senator Peter Fitzgerald. "Congress just got out the ladle
and shoveled it all over the place."
For example: $20 million was shoveled to three
bankrupt airlines like Vanguard, Midway, and Reliant. Nearly $165
million went to package-delivery companies. Another $5 million went
to helicopter companies that, among other things, ferry workers to
oilrigs and run tours to the Grand Canyon. Even three companies
that arrange travel from the U.S. to Cuba cashed in.
And for every multi-million dollar payout, there
were dozens of small ones to places like Flying Eagle Aviation of
Kokomo, Indiana. Company vice president Dottie Crebo never expected
to find herself on a list alongside Delta, United and American.
"We got a little over $2,000 in April of this year,"
says Crebo. "I did not really expect the federal government to pay
attention to small businesses like ours."
Vacation tour operator Bill LaMacchia doesn't
apologize for his $3.5 million.
"It is a prudent decision for any organization to
take advantage of an opportunity," says LaMacchia.
Fitzgerald says it was taxpayers who were taken
advantage of.
"It's an embarrassment how free Congress was with
taxpayer dollars," Fitzgerald says.
Free with dollars, but not forthcoming with details.
Even if Americans wanted to find out how the DOT made its
decisions, they can't because the department says the applications
process is private -- even from the public who is paying the
price.
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