Durbin Asks Colleagues to Support Even Playing Field for Airlines

Statement

Durbin Asks Colleagues to Support Even Playing Field for Airlines

U.S. Senator Dick Durbin (D-IL) today made the following statement about a provision that would require five top domestic air carriers to pay an additional $2 billion into their pension funds.

"Today, Senator Baucus included language in the FAA bill that asks five of our top domestic air carriers to pay an additional $2 billion into their pension funds. While it may be well intentioned, this proposal will cause more problems than it solves.

Battered by rising fuel costs and a troubled economy, the airline industry has already had a tough time. In the past year alone, six airlines have filed for bankruptcy, thousands of people have lost their jobs, and several airlines have posted their largest single quarterly loss. This is no time to squeeze $2 billion dollars out of five of our country's top carriers and threaten the stability of the industry.

One of the carriers impacted by this plan, American, is the only major airline that has not declared bankruptcy and has not reduced pension benefits for any employees. Its pension fund is fully solvent; in fact it's currently overfunded at 115%. There is no need to force airlines like American to contribute even more of their capital to their pension funds, especially when such a move could potentially bankrupt them.

Two years ago, airlines like American, Continental, Hawaiian, Alaskan, and US Airways that remained solvent and fought to keep their promises to employees were punished with unfavorable interest rates and amortization plans. Last year, the Senate came together in a near unanimous vote to right that wrong. Today, I again ask my Senate colleagues to oppose unfairly burdening those airlines who have done more than other airlines to avoid bankruptcy and keep their promises to their employees and retirees."

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