Economic Analysis of United Airlines

This paper is an analysis of the economic impact of governmental subsidies and fiscal policies on United Airlines after 9-11. This is an industry that much of our local, national and global economic vitality depends. An instantaneous and apparent financial consequence of the attacks was the full grounding of the airlines for days, which was followed by an unparalleled decline in demand. The value of planes plunged, as did the airline’s ability to obtain credit. Immediate stabilization measures, as lawmakers authorized cash compensation and institution of a federal loan guarantee program, prevented almost certain bankruptcy for many airlines and a loss of the nation’s second largest airline. This analysis indicates a strong potential for economic growth following the airline’s recovery. While the projected economic growth is not expected to exceed the potential, United Airlines (UAL) is in a position to capitalize on this growth as the global economy strengthens. The economi...