Give Boeing the Bailout It Doesn’t Deserve
It’s not easy to stomach the thought of a company so recently culpable for 346 deaths getting government cash, but mass layoffs would be devastating.
Just as there are no atheists in foxholes, there are precious few saints in government bailouts.
Photographer: Qilai Shen/BloombergA Boeing Co. bailout is to the coronavirus crisis what the bank bailouts were to the financial crisis: a systemically important — but currently deeply unpopular — company getting a handout after its own missteps weakened its defenses in a time of need.
Boeing has reportedly asked the White House and lawmakers for short-term aid for itself, suppliers and airlines as coronavirus-related shutdowns across the globe bring travel to a near standstill. Boeing certainly needs the cash: the now one-year grounding of its 737 Max jet following two fatal crashes has left it reliant on wide-body models for which demand is cratering. The company spooked markets last week by drawing down the full amount of a $13.8 billion term loan and announcing cash-preservation moves including a hiring freeze and limits to overtime pay. JPMorgan Chase & Co. analyst Seth Seifman has suggested the company will cut its dividend and Standard & Poor’s on Monday lowered Boeing’s credit rating two notches to BBB on expectations of weaker cash flow for the next two years. But while President Donald Trump on Monday explained a developing White House plan to backstop airlines by pointing out that their current challenges were “not their fault,” the same can hardly be said of Boeing.