Exit of another subsidized PIT failure?
“Thank you, ma’am, may I have another?!”
Yet again, the Allegheny County Airport Authority’s attempt to command the marketplace at Pittsburgh International Airport (PIT) appears to have failed.
Only this time, it’s a “double-down” failure, the latest in a long line of marketplace clubbings financed by public dollars.
The Post-Gazette’s Mark Belko reports that “less than three months after its latest round of subsidies ended, Qatar Airways has suspended cargo service between (PIT) and the Qatari capital of Doha – at least for now.”
An authority spokesman calls the suspension “temporary,” coming “during the off-peak season.” Service supposedly will resume “when worldwide cargo volume increases.” But the authority has been given no indication when cargo flights might resume.
Ah, yes, we’ve seen this subsidies-run-out, service-is-temporarily-suspended story before at PIT, haven’t we?
Those Qatar cargo flights stopped in mid-December, two-and-a-half months after the latest subsidy deal (valued at a maximum of $780,000) expired.
And here’s a hoot: Federal Aviation Administration (FAA) guidelines preclude the authority from offering Qatar additional “incentives,” the newspaper reports.
Turns out even the FAA has limits to such market perversion, eh?
The Airport Authority reportedly still is calculating exactly how much of that latest subsidy will be paid. The amount is based on how much cargo Qatar shipped. But, based on a running volume tally in July, officials did not expect the full $780,000 to be paid.
What a sordid tale these Qatar dealings have been. The first deal incentivized Qatar to fail – paying it $1.48 million to do so. As if that wasn’t the height of true bureaucratic economic ignorance, the successor deal paid Qatar to succeed.
Uhm, hold the phone. If Qatar succeeds, why should public dollars be added as some sort of bonus?
And all this is what Airport Authority CEO Christina Cassotis – in September 2017 – called “a game changer for the region.”
One aviation consultant who, in the past, has been all rah-rah-sis-boom-bah about the long string of subsidies to airlines at PIT – interventions that have, predictably, crashed and burned — must have had something of an epiphany upon hearing the latest Qatar news:
“There might not be enough demand for air cargo out of Pittsburgh for this,” Michael Boyd told the P-G.
Of course, gauging demand should have been part of the business plan that Qatar created to determine if there was enough profit potential to risk its own money to develop a new market.
Public dollars should not have been turned into venture capital dollars used to pay for yet another round of corporate wealthfare. That the Allegheny County Airport Authority continues to solicit and cut such deals calls into serious question its competency.
Colin McNickle is communications and marketing director at the Allegheny Institute for Public Policy (firstname.lastname@example.org).