It may all be about the business of retaliation
Passengers travelling to the United States from 10 airports in eight Muslim-majority countries are not allowed to have iPads, laptops or any communications device larger than a smartphone in the cabin of the plane. The US says it’s all about security. As Demitri Sevastopulo and Robert Wright at the Financial Times suggest, non-US observers are sceptical of this explanation.
However, there is an alternative explanation.
Three of the airlines that have been targeted for these measures — Emirates, Etihad Airways and Qatar Airways — have long been accused by their US competitors of receiving massive effective subsidies from their governments.
These airlines have been quietly worried for months that President Donald Trump was going to retaliate. This may be the retaliation.
These three airlines, as well as the other airlines targeted in the order, are likely to lose a major amount of business from their most lucrative customers — people who travel in business class and first class.
Business travellers are disproportionately likely to want to work on the plane — the reason they are prepared to pay business-class or first-class fares is because it allows them to work in comfort.
These travellers are unlikely to appreciate having to do all their work on smartphones, or not being able to work at all. The likely result is that many of them will stop flying on Gulf airlines, and start travelling on US airlines instead.
As the Financial Times notes, the order doesn’t affect only the airlines’ direct flights to and from the US — it also attacks the “hub” airports that are at the core of their business models.
These airlines not only fly passengers directly from the Gulf region to the US but they also fly passengers from many other destinations, transferring them from one plane to another in the hubs.
This “hub and spoke” approach is a standard economic model for longhaul airlines, offering them large savings. However, it also creates big vulnerabilities. If competitors or unfriendly states can undermine or degrade the hub, they can inflict heavy economic damage.
The United States is plausibly leveraging its control over access to US airports, which are central “nodes” in the global network of air travel between different destinations. It is using this control to attack the key vulnerabilities of other networked actors, by going after the central nodes in their networks (the hub airports) and potentially severely damaging them.
There may not be much that Gulf airline carriers can do. Gulf airlines have tried to defend themselves against political attacks from US competitors by appealing to free trade principles. The problem is that standard free trade agreements, such as World Trade Organisation rules, don’t really apply to airlines.
This has allowed the Gulf airlines to enjoy massive subsidies, without having to worry too much about being sued in the WTO. However, it also makes it hard for Gulf states or the states of other affected airlines to take a WTO case against the new US rules, even if these rules turn out to be motivated by protectionism and the desire to retaliate, rather than real underlying security questions. Representative Adam Schiff, the top Democrat on the House Intelligence committee, said he backed the new precautions as “both necessary and proportional to the threat”.
However, human rights group Amnesty International said the restrictions raised “serious concerns that this could be yet more bigotry disguised as policy”.