A bailout for airlines? Are you kidding?

Re Everyone loses if the airlines go under, Olive, May 23

Shareholders in our airline companies do not qualify for financial bailouts any more than shareholders in Irving oil, Loblaws, Telus or Home Hardware.

Since the beginning of this year, the price of oil has dropped about $30 per barrel, with a corresponding drop in the price of shares in virtually all Canadian oil and gas companies.

People invested in those companies, hoping to make a profit, and some of them did, and they will “qualify” to pay a capital-gains tax on those profits.

Other investors lost money, and they will be able to apply those losses to their taxable incomes and pay less taxes.

Investors who own shares in airline companies qualify for the same tax considerations, and can apply the losses to reduce their taxable incomes.

When any of those companies lose money, the losses are suffered exclusively by the shareholders. Andy Thomsen, Kelowna, B.C.

If Reitman’s can file for bankruptcy protection and keep operating, then why not Air Canada? When I was doing my MBA, owning shares in a company was compared to buying a call option, with the debt holders being the ones who sold the option; it is a bet on the total value of the firm.

If the company ends up being worth less than the value of the debt, then the lenders should take a haircut.

When it comes to refunds, governments should be sticking up for consumers who paid for something the airlines failed to deliver.

By not enforcing laws or requiring cash refunds, governments or regulators are picking the interests of shareholders (or debt-holders) over consumers who paid for something they didn’t get on the day promised.

Airlines might be strategic industries we need to preserve as part of our transportation infrastructure, but just as 100 years ago, when the government bought up bankrupt railways to create CN, we should nationalize airlines that are broke and then provide subsidies to keep them going.

Government should not be favouring shareholders. At most, government should lend money to keep airlines going, but with the clear legal right to nationalize the assets and operations at liquidation value if it becomes necessary. Brian Graff, Toronto

David Olive’s apologia on behalf of Canadian airlines, Air Canada in particular, is manifestly unfair to those of us whose pockets are being picked clean — apparently with the willing connivance of Transportation Minister Marc Garneau, the Canadian Transportation Agency and the purposefully meaningless statements from Prime Minister Justin Trudeau.

Refunds are not a matter of assigning “blame,” as the writer suggests; they are a simple requirement when we pay for a future service and that service is cancelled by the service provider for whatever reason.

If the airlines adopt a business model that spends my money before providing the service I paid for, leaving them short, that’s their problem, not mine.

If airlines are a matter of national interest, the writer should endorse the notion of government support, rather than the off-loading of the obligation onto those who can “afford air travel,” as he so cavalierly suggests.

Meanwhile, give us our money back. Bruce Campbell, Toronto