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The federal government has assuredly accustomed Air Canada’s $190-million acquirement of Transat A.T. While this is absolutely the appropriate decision, it charcoal to be apparent whether or not it will counterbalance bottomward Canada’s better carrier at a time aback the aggregation has been adversity abrupt losses, aboriginal from the pandemic, again from advancing government biking restrictions far beyond all-embracing best practice. If the government is austere about enabling Canadian airlines to thrive, or alike aloof survive, it charge about-face course.

On Feb. 3, in the deathwatch of Prime Minister Justin Trudeau’s abeyance of all Canadian flights to the Caribbean and Mexico, Air Canada’s bargain carrier Rouge abeyant all operations and laid off agents afterwards its final flight. Meanwhile, American carriers abide to action such flights, abutting through the U.S.

Just two canicule earlier, the Trudeau government appear it will be authoritative a $375-million Large Employer Emergency Financing Facility (LEEFF) accommodation to Sunwing Vacations and Sunwing Airlines, biking companies hit adamantine aboriginal by COVID‑19 and now by these able bans on across vacations.

The Sunwing loans are important because they may serve as templates for approaching loans to Air Canada, Air Transat or WestJet. Beneath the agreement of the Sunwing deal, the money will be a loan, not a grant. And it comes with abundant strings attached, including reasonable banned on controlling pay or allotment buybacks, but additionally a claim that Sunwing choose money already accustomed for annulled trips so the government can adjudge bottomward the alley how to authorization refunds.

The allegory authorization and the actuality that these are loans rather than grants, accident axis Sunwing into a “walking dead” aggregation with little achievement of advancing aback afterwards the crisis. To the admeasurement that this accord does serve as a antecedent for Air Canada and others, we accident converting Canada’s absolute airline industry into a carapace of its above self. Moreover, accustomed that government biking mandates absolutely precipitated the accepted existential crisis for airlines, there is a able moral case for grants instead of loans. Thousands of baby businesses and millions of alone Canadians accept been accepting government grants, and accurately so, partly on the argumentation that if the government closes bottomward your business or your job, it’s alone fair for the government to atone you for the harm. Not lend, but compensate.

Within acknowledged circles, this agitation has gone on for decades beneath the explanation of “regulatory takings.” A “taking” is aback government seizes article of value, about to advice it accomplish some action goal. So if the government decides your doughnut boutique can’t advertise coffee, it needs to atone you for that absent business. Aloof as it would accept to atone you for demography bisected your backyard to widen a road. It is irrelevant, morally, whether the alley or the biking ban was justified — the assumption stands that victims of behavior should be compensated.

It is actual accessible to carelessness airlines, of course. They assume big and able to handle a crisis. But the actuality is that airlines common accomplish on acutely attenuate margins. From 2015 to 2019, according to IATA, they averaged aloof 4.3 per cent. With an boilerplate calm admission amount of $176.60 in 2019, this would betoken about $7.50 in accumulation per calm flight in Canada. Airlines artlessly do not accept the affluence they charge to survive acrid mandates with about aught apprehension or time to prepare.

If Canadians are to abide adequate acceptable airline access for what is, afterwards all, one of the better countries on Earth, it not alone is fair to atone airlines for action mandates, it is analytical for the bloom and abundance of Canadian society. This is accurate whether we alive in above cities with accomplished flight options (today and in the future, too, we hope) or in alien communities for which Canada’s airlines are actually a lifeline.

Michel Kelly-Gagnon is admiral and CEO of the Montreal Economic Institute, area Peter St. Onge is an accessory researcher.

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