QANTAS is an interesting one.
Normally I would agree with paws and formerguest when they say Governments should not bail out businesses (think Holden debacle).
One key difference is that ultimately, the government took measures to temporarily stop QANTAS being able to run their core business (i.e. travel bans). QANTAS were not in financial trouble prior to any of this and although they reduced their capacity significantly, some revenue would still be coming in were it not for a complete ban on travel. Also, the bailout was largely a moratorium on fees and charges rather than a cash handout - given it's impossible for them to trade due to a government decision, it may been seen as a reasonable trade-off to cut fees and charges.
QANTAS also employs around 30,000 people - it's a big employer in the aviation industry. If these people lose their jobs, it's not like there's another airline they can all flock to and regain employment. Add to this, the only places really hiring at the moment are supermarkets, you're pretty much left with 30,000 people on welfare for a really long time.
QANTAS not only employs people. Other businesses feed off the back of QANTAS as well. Think airline catering, baggage handling, refuelling contractors. The list goes on.
If QANTAS goes, so do these other businesses. The flow on effect runs deep.
On the other hand, we could take an Economic Darwinism approach and let struggling businesses fail. I'm not against this either. However, will that have an impact on businesses being confident to operate in Australia in the future?
Would you want to risk billions of dollars in a country that makes a snap decision that can send your company bust?
Another view might be, why are QANTAS job losses and those that would stem from QANTAS failing more important than an equal number of individual small businesses in the economy? Or an equal number of unemployed people?
My view is that there are pros and cons to the argument. The question is always do the pros outweigh the cons?
I dare say, when I weigh up the situation, I'm ok with the bailout, but at the same time question whether $720 million could have helped more than 30,000 during this time?
All valid points. Is QANTAS not majority owned by the government still? It's in their interest to ensure their investment survives which would be my first guess. Probably a shedload of super funds tied to them as well I'd wager a guess. I am not against the government propping up primarily nationalised companies, as they will return to work for a business that will earn a profit, and not join the dole queue.
I'll admit I'm not au fait with the details of the package. If anyone has a good link to the details of it I'd be very appreciative.