Corporate Scandals

In Defense of Corporate Jets

|

cessna

A little love for the much-abused corporate jet in The New York Times:

The Cessna's popularity…centers on another data point: 3,250. That's the number of feet of runway required for the aircraft to accelerate to flying speed and take off or, should something catastrophic occur, slam on the brakes and still have pavement remaining.

That figure—3,250 feet—means business aircraft can alight on any of the 5,000 or so public-use airports scattered throughout the nation's suburbs, small towns and back country, as well as land at small city airports abandoned by airlines decades ago. By contrast, the airlines fly to only about 500 airports, and of those, fewer than 70 get about three-quarters of all traffic.

And the case against congressional scapegoating of these flying minivans:

it's astounding to see members of Congress, the very people doling out hundreds of billions of taxpayer dollars to failed companies, disparaging and even actively trying to curtail [the corporate jet] industry, which is already reeling from the economic and credit crises. The business jet is merely a tool—one that, employed correctly, could help those same struggling institutions soar again and start paying back the money owed, with interest.

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

23 responses to “In Defense of Corporate Jets

  1. And if you’ve ever had the chance to fly in them – THEY ARE TOTALLY FUCKING SWEET

  2. Well the politicians are just trying to play on resentment of the masses who don’t have the option of bypassing the big airlines, big overcroweded airports and annonying security procedures by chartering a private jet for trips.

  3. “You don’t like mustard? I suppose they should just stop making mustard and close all the factories and fire all those people. Now you want to starve their families….just because you don’t like mustard.”

    What about expensive tailored suits? I bet those CEO’s all wore five figure suits to beg money from Congress. Maybe they should all be forced to shop at Wal-Mart on top of a pay cut.

  4. There has to be a pretty high premium on the value of one’s time for a corporate jet to be worth the expense differential between that and a first class ticket, even accounting for travel time to the airport + security delays. Not to mention that while the corporate bigwigs live in Greenwich, their offices are still in midtown Manhattan, and their business meetings are also nearly always near the center of the largest cities in the world.

    There’s also the old quote when Babe Ruth was asked his opinion on the fact that he got paid more than the president. “I had a better year”. Well, these clowns had a very bad year; they had the worse year of anyone in their business since 1907, and potentially in the history of money. We would have been better served if they would have spent a little more time in the Star Alliance lounges. We couldn’t have done any worse.

    Spend all the money on corporate jets you want with your money. But now that it’s ‘our’ money ‘we’ are going divide it up ‘our’ way, like Mr. Hand with Spicolli’s pizza.

  5. Ever hear of a TELECONFERENCE?!

  6. In case anyone is wondering, congressmen have access to a fleet of government jets for their official travels. I haven’t heard any of them complain about those.

  7. Adam | February 2, 2009, 3:39pm | #

    “In case anyone is wondering, congressmen have access to a fleet of government jets for their official travels. I haven’t heard any of them complain about those.”

    That would indicate the federal government is in debt….oh wait.

  8. I guess Katie M-W forgot to mention that this love letter was written by William Garvey, editor in chief of the magazine Business and Commercial Aviation. The Cessna about which he writes so lovingly is not, I suspect, the $42 million flying limo that Citicorp was planning to buy.

    Jets are terrific. I fly them all the time. But I don’t own one, which, to my mind, is a pretty big difference. I’m still holding out for my jet-pak.

  9. Adam FTW. As Kolohe said, yes these guys had a bad year, but it is so galling for congresscritters to sit in judgment and lambaste these guys for buying jets with their own money (or, part of their own money, if you want to start in on how TARP has made us all owners), but Congress flies entirely on our money.

    I know that here in the Ohizzle, the legislators, government workers and even the governor are all talking “pay cuts” for themselves; where’s the national leadership here? Can we start making legislators pay for their own meals? Their own flights? Their own residences in D.C.?

    They remind me more and more of the Politboro: “Some animals are more equal than others”.

  10. I think the argument is that corporate executives tend to vastly overvalue their own time, and since you need a large valuation attached to justify a corporate jet, jets are not nearly as valuable to these companies as asserted.

    You also must consider opportunity cost in a crisis – would the same money be better spent on restructuring the business, severance for workers you need to lay off, stockpiling cash to manage working capital, and so on. When you allow for the fact that very few events *really* require executive travel (teleconferencing, video, etc. are excellent, low-cost substitutes), and that shares of jets are readily available, a corporate jet is hardly an obvious steal.

  11. There has to be a pretty high premium on the value of one’s time for a corporate jet to be worth the expense differential between that and a first class ticket, even accounting for travel time to the airport + security delays.

    For someone making seven figures a year, that premium is pretty easily met. Especially when you figure in the cost of buying a ticket on short notice (if available; with schedules cut back as they have been, lots of flights are sold out).

  12. “There’s also the old quote when Babe Ruth was asked his opinion on the fact that he got paid more than the president. “I had a better year”. Well, these clowns had a very bad year; they had the worse year of anyone in their business since 1907, and potentially in the history of money. We would have been better served if they would have spent a little more time in the Star Alliance lounges. We couldn’t have done any worse.”

    The populist politicians have been railing against CEO’s and their perceived perks of corporate jets (among other benefits) for a long time – long before the bank bailouts.

    If having a bad year is rationale for staying out of corporate jets, then the reverse must also true : the Exxon-Mobil execs should spend all their time in the air since they just reported the highest dollar annual profit of any corporation in history.

  13. After coming close to a championship, the GM of the Dtroit Pistons was asked by the owner what would help put them over the top.

    The answer? A corporate jet to fly the team on road trips, a fiest in the NBA. Back to back NBA championships ensued.

  14. Let me clear, congressional grandstanding is the usual empty hypocrisy it normally is.

    And I have no problem with private jets. And I do have have a problem with “actively trying to curtail [the corporate jet] industry”; we saw the same stupid populism with the Bush 1 ‘luxury tax’ that destroyed the New England boat building industry.

    But this:

    The business jet is merely a tool-one that, employed correctly, could help those same struggling institutions soar again and start paying back the money owed, with interest.

    is such a load pig crap, it could power Bartertown for a millenium.

    Looking on line now, a last minute coast to coast JFK-LAX 1st class airfare is around $3K. A fractional share on netjets is $500K for 50 hours. And that’s as cheap as they get.

    He who pays for the Piper calls the tune. And right now the music is Rhapsody in Blue

  15. Kolohe – this Piper/Tune stuff? I’m not on board. All we’re doing is encouraging even greater power grabs the next time.

    Look at it from the perspective of a typical bailed-out CEO: you either take the money, or your competitors do. It would be irresponsible for you to screw over your shareholders like that.

    This is how national healthcare is going to backdoor total control over our individual food/drink/substance choices. “Government pays the piper for your health care, so we get to call the tune…and the tune is ‘Let’s Get Physical'”.

  16. The “broken windows”/”shoemaker’s son” argument at the end of the post isn’t really worth mentioning here, is it?

  17. Hit’N’Runners shorely do worship rich ppl! Uh huh, uh huh, uh huh.

  18. TAO-
    Ford ain’t. We’ll see how that works long term.

    I still think, on balance, it is a feature not a bug, that when you take money out of the commonwealth, people get all up in your grill about every little thing, It disincentivises it. I similarly have no problem micromanaging people’s lives when they partake the more conventional form of welfare. For more broad based enititlements, like public schools for instance, the widespread nature mitigates the tendency for onerousness. Well, in theory at least, in practice you do get petty tyrannies. But as long as there’s an opt out option, so be it. Or make sure you’re one of the tyrants.

  19. I heard corporate jets use less energy than a Prius.

    Where the hell do you find these people, Nick?

  20. A private Cessna would really help *my* personal finances “soar again.”

    Can I get the government to buy me one?

  21. I’ve met a guy who flies a private jet. He’s a successful businessman who has spent years working hard and innovating in an obscure industry. I have absolutely no problem with this–he earned his money and he pays his taxes. There’s no reason why he can’t buy a private jet[1], or any other toy which he wants.

    On the other hand, I’ll happily mock the private jets of Wall Street. The investment bankers in question are some of the most disastrously unsuccessful businessmen in the history of the world. As far as I can tell, their time actually has negative value, and many of them are nothing but scam artists.[2]

    But apparently, if we let these worthless investment banks fail, the world economy will implode.[3] So hard-working Americans will be paying taxes for decades to bail out these banks.

    Since these people are far too incompetent to run a business, I see absolutely no reason why they should get to spend my money on private jets, lavish parties, bonuses, or anything else. In fact, I’m having trouble understanding why some of them are still employed.

    [1] Well, there are environmental externalities, but those could be addressed with any number of market-based solutions, and he’d still be able to afford a private jet, AFAIK.

    [2] “Secondary CDOs” are so staggeringly dishonest that they ought to have been classified as fraud.

    [3] That’s the argument, anyway. And the collapse of Lehman Brothers suggests that bankruptcy is not an effective tool in the current situation.

  22. Hey people, these private jets, and other small aircraft are american manufacturing jobs! Over the next few months, tens of thousands of engineers and skilled workers will be losing their jobs in the midwest because of the market downturn, and ignorant generalizing by many of you who are confusing the excesses of the failed wall street execs with the use and need for small aircraft.

Please to post comments

Comments are closed.