11 ms·

Can we do away with these absurd foreign ownership laws yet? Why would we want to discourage people from investing in our country?

by jvm 11y ago

ibejoeb 11y ago
We're not. Branson owns 31% of the company. He is only capped on shares with voting rights.
- cwyers 11y ago
  How is not allowing people to have influence over corporate decisions commensurate with the size of their investment not discouraging that sort of investment?
  - ibejoeb 11y ago
    He's free to invest. He's not free to control. As an investor, he's making out very well with a ~50% premium. Surely you can recognize the merit in keeping domestic control of transportation, which is the reason these regulations exist.
    - greggyb 11y ago
      > Surely you can recognize the merit in keeping domestic control of transportation, which is the reason these regulations exist. Not OP, and not trying to be glib, but I think you're skirting the major objection by assuming agreement here. Differential privilege due to happenstance of birth location seems a pretty arbitrary line to me, in need of justification.
      - Tobani 11y ago
        It sounds like the requirement is citizenship. Citizenship isn't exactly happenstance of birth location.
      - dsl 11y ago
        As an american I can't own property or a business in _most_ of the world, without a local proxy. We also have programs that will give you citizenship if you commit to investing money long term and taking an allegiance to the United States.
    - JoshTriplett 11y ago
      > Surely you can recognize the merit in keeping domestic control of transportation That doesn't seem entirely self-evident, and that's part of the subject of this discussion thread. There are already extensive regulations on the operation and safety of airlines, most of them likely for good reason. Why, above and beyond those regulations, do we additionally need to limit ownership? If the answer is "handwave handwave safety handwave security", then I'd point out that there are dozens of other industries even more ingrained into the US where someone looking to do damage could do far more harm than they ever could with an airline, and none of those industries have prohibitions on foreign ownership.
      - RockyMcNuts 11y ago
        well, you wouldn't want foreign airlines giving their governments information about military and VIP movements, letting their intelligence services intercept and tamper with shipped packages, maybe fit planes on interesting routes with surveillance equipment. i.e. the stuff the US does.
        sangnoir 11y ago
        > you wouldn't want foreign airlines giving their governments information about military and VIP movements Just how magical is the the extra 2% that takes one from an "OK/freiendly" 49% foreign shareholder to a 51% (or 50% +1?) "oh no, intel stealer!". I sort-of understand the control argument, but not the secrecy argument you are making doesn't hold up.
        RockyMcNuts 11y ago
        it was tongue in cheek, but yeah, that 2% (or .01%) to go from junior partner to running the show is pretty magical. (ask a game theorist, or Al Gore!)
    - tacos 11y ago
      Huh? I just transferred from a Kawasaki train car to a Canadian bus with an Isuzu Engine to board an Airbus that was routed to JFK via British flight controllers, fueled by imported oil. Glad we got it nailed down.
      - the_hangman 11y ago
        Correct. But none of those entities are controlling transportation infrastructure in the United States. They're manufacturing vehicles or parts necessary for those vehicles, or controlling the air traffic on a completely separate continent. The law's intent (not saying that I agree with it) is to ensure that the air transit infrastructure in the United States is controlled by U.S. citizens, not that every piece of transportation equipment worldwide is manufactured and controlled by the U.S.
    - kchoudhu 11y ago
      > Surely you can recognize the merit in keeping domestic control of transportation No, I really don't. In times of true national crisis, emergency powers allow the US government to commandeer the civil air fleet for military uses. The rest of the time, these foreign ownership restrictions prevent better operators from taking ownership stakes and fixing the efficiency problems that plague uncompetitive mainline US airlines. I for one would LOVE to see what an ME3 carrier could do with, say, American Airlines.
      - ubernostrum 11y ago
        I for one would LOVE to see what an ME3 carrier could do with, say, American Airlines. Depends. Is that an ME3 carrier on its own, or an ME3 carrier with an unlimited government subsidy to keep it afloat no matter how much money it loses? Because the latter is what really exists -- those airlines aren't run as for-profit businesses, they're run as vanity projects by the backing governments.
        kchoudhu 11y ago
        I'm not sure the links between the government and the ME3 carriers are as clear as you think. And even if they were (and this is going sound scandalous): who cares? If some Emirati government wants to subsidize my domestic travel within the US, they should feel very free to do so! I'll take the better service and cheaper prices in a heartbeat.
    - enraged_camel 11y ago
      >>Surely you can recognize the merit in keeping domestic control of transportation And yet we're almost completely dependent on foreign countries for oil, without which most of our transportation methods would crumble.
    - cwyers 11y ago
      From Merriam Webster: Full Definition of discourage dis·cour·aged dis·cour·ag·ing transitive verb 1 : to deprive of courage or confidence : dishearten <was discouraged by repeated failure> 2 a : to hinder by disfavoring <trying to discourage absenteeism> b : to dissuade or attempt to dissuade from doing something <tried to discourage her from going> To hinder by disfavoring. Foreign investors are disfavored -- they can invest, but under different (and less favorable, hence disfavored) terms. They are hindered in the process. You can make a case that this hindrance is a good thing, if you want to, I guess. But you're trying to do so while at the same time claiming it doesn't exist.
      - throwaway_xx9 11y ago
        For those puzzled by the dictionary quote, the OP used the work discouraged correctly, but cwyers couldn't parse the OP's comment because of the negatives.
        cwyers 11y ago
        ...I've read over this thread a few times, and my best guess is that you think I can't parse my own comment.
alistairSH 11y ago
I wonder what makes USDOT think a foreign national is any more or less likely to follow the rules than an enormous multi-national corporation like United or Delta? These foreign-ownership rules do strike me as counter-productive protectionism.
- tn13 11y ago
  For the same reason they think banning drugs will make people stop using it. Government does not care about outcome it cares about the show they need to put up to convince people they are doing something good.
- JamilD 11y ago
  The airline industry is extremely protectionist. I'd rather fly on Qantas JFK-LAX (they do fly that route) but cabotage rules prevent them from selling tickets on it. Because evidently if any competition comes to the domestic aviation industry, US airlines are doomed.
  - Spooky23 11y ago
    History has pretty much established that competition in the space is destructive. Allowing international carriers transiting the US to do intra-city flights soaks up demand and lowers route profitability for busy routes. Past practices were to balance demand across city pairs so as to avoid local monopolies (ie. Minneapolis and Delta/Northwest) and ensure universal service. Deregulation broke all of that, so we have price competitions at the cost of a race to the bottom in service and industry cycles of bankruptcy and consolidation. Long term, that means monopoly levels of service and pricing.
    - getpost 11y ago
      Huh? Airline deregulation since 1978 is one of the poster children for improved service to consumers. Any transportation business is inherently subject to the flux of fuel prices and demand as it varies with overall economic activity. If anything, difficulties airlines now face are compounded by the degree of regulation that is still in force.
pbreit 11y ago
I don't think this is any ole foreign ownership laws. There's a national security interest among other things.

Can we do away with these absurd foreign ownership laws yet? Why would we want to discourage people from investing in our country?

by jvm 11y ago

Can we do away with these absurd foreign ownership laws yet? Why would we want to discourage people from investing in our country?

ibejoeb 11y ago

We're not. Branson owns 31% of the company. He is only capped on shares with voting rights.

cwyers 11y ago
How is not allowing people to have influence over corporate decisions commensurate with the size of their investment not discouraging that sort of investment?
- ibejoeb 11y ago
  He's free to invest. He's not free to control. As an investor, he's making out very well with a ~50% premium. Surely you can recognize the merit in keeping domestic control of transportation, which is the reason these regulations exist.
  - greggyb 11y ago
    > Surely you can recognize the merit in keeping domestic control of transportation, which is the reason these regulations exist. Not OP, and not trying to be glib, but I think you're skirting the major objection by assuming agreement here. Differential privilege due to happenstance of birth location seems a pretty arbitrary line to me, in need of justification.
    - Tobani 11y ago
      It sounds like the requirement is citizenship. Citizenship isn't exactly happenstance of birth location.
    - dsl 11y ago
      As an american I can't own property or a business in _most_ of the world, without a local proxy. We also have programs that will give you citizenship if you commit to investing money long term and taking an allegiance to the United States.
  - JoshTriplett 11y ago
    > Surely you can recognize the merit in keeping domestic control of transportation That doesn't seem entirely self-evident, and that's part of the subject of this discussion thread. There are already extensive regulations on the operation and safety of airlines, most of them likely for good reason. Why, above and beyond those regulations, do we additionally need to limit ownership? If the answer is "handwave handwave safety handwave security", then I'd point out that there are dozens of other industries even more ingrained into the US where someone looking to do damage could do far more harm than they ever could with an airline, and none of those industries have prohibitions on foreign ownership.
    - RockyMcNuts 11y ago
      well, you wouldn't want foreign airlines giving their governments information about military and VIP movements, letting their intelligence services intercept and tamper with shipped packages, maybe fit planes on interesting routes with surveillance equipment. i.e. the stuff the US does.
      - sangnoir 11y ago
        > you wouldn't want foreign airlines giving their governments information about military and VIP movements Just how magical is the the extra 2% that takes one from an "OK/freiendly" 49% foreign shareholder to a 51% (or 50% +1?) "oh no, intel stealer!". I sort-of understand the control argument, but not the secrecy argument you are making doesn't hold up.
        RockyMcNuts 11y ago
        it was tongue in cheek, but yeah, that 2% (or .01%) to go from junior partner to running the show is pretty magical. (ask a game theorist, or Al Gore!)
  - tacos 11y ago
    Huh? I just transferred from a Kawasaki train car to a Canadian bus with an Isuzu Engine to board an Airbus that was routed to JFK via British flight controllers, fueled by imported oil. Glad we got it nailed down.
    - the_hangman 11y ago
      Correct. But none of those entities are controlling transportation infrastructure in the United States. They're manufacturing vehicles or parts necessary for those vehicles, or controlling the air traffic on a completely separate continent. The law's intent (not saying that I agree with it) is to ensure that the air transit infrastructure in the United States is controlled by U.S. citizens, not that every piece of transportation equipment worldwide is manufactured and controlled by the U.S.
  - kchoudhu 11y ago
    > Surely you can recognize the merit in keeping domestic control of transportation No, I really don't. In times of true national crisis, emergency powers allow the US government to commandeer the civil air fleet for military uses. The rest of the time, these foreign ownership restrictions prevent better operators from taking ownership stakes and fixing the efficiency problems that plague uncompetitive mainline US airlines. I for one would LOVE to see what an ME3 carrier could do with, say, American Airlines.
    - ubernostrum 11y ago
      I for one would LOVE to see what an ME3 carrier could do with, say, American Airlines. Depends. Is that an ME3 carrier on its own, or an ME3 carrier with an unlimited government subsidy to keep it afloat no matter how much money it loses? Because the latter is what really exists -- those airlines aren't run as for-profit businesses, they're run as vanity projects by the backing governments.
      - kchoudhu 11y ago
        I'm not sure the links between the government and the ME3 carriers are as clear as you think. And even if they were (and this is going sound scandalous): who cares? If some Emirati government wants to subsidize my domestic travel within the US, they should feel very free to do so! I'll take the better service and cheaper prices in a heartbeat.
  - enraged_camel 11y ago
    >>Surely you can recognize the merit in keeping domestic control of transportation And yet we're almost completely dependent on foreign countries for oil, without which most of our transportation methods would crumble.
  - cwyers 11y ago
    From Merriam Webster: Full Definition of discourage dis·cour·aged dis·cour·ag·ing transitive verb 1 : to deprive of courage or confidence : dishearten <was discouraged by repeated failure> 2 a : to hinder by disfavoring <trying to discourage absenteeism> b : to dissuade or attempt to dissuade from doing something <tried to discourage her from going> To hinder by disfavoring. Foreign investors are disfavored -- they can invest, but under different (and less favorable, hence disfavored) terms. They are hindered in the process. You can make a case that this hindrance is a good thing, if you want to, I guess. But you're trying to do so while at the same time claiming it doesn't exist.
    - throwaway_xx9 11y ago
      For those puzzled by the dictionary quote, the OP used the work discouraged correctly, but cwyers couldn't parse the OP's comment because of the negatives.
      - cwyers 11y ago
        ...I've read over this thread a few times, and my best guess is that you think I can't parse my own comment.

alistairSH 11y ago

I wonder what makes USDOT think a foreign national is any more or less likely to follow the rules than an enormous multi-national corporation like United or Delta? These foreign-ownership rules do strike me as counter-productive protectionism.

tn13 11y ago
For the same reason they think banning drugs will make people stop using it. Government does not care about outcome it cares about the show they need to put up to convince people they are doing something good.
JamilD 11y ago
The airline industry is extremely protectionist. I'd rather fly on Qantas JFK-LAX (they do fly that route) but cabotage rules prevent them from selling tickets on it. Because evidently if any competition comes to the domestic aviation industry, US airlines are doomed.
- Spooky23 11y ago
  History has pretty much established that competition in the space is destructive. Allowing international carriers transiting the US to do intra-city flights soaks up demand and lowers route profitability for busy routes. Past practices were to balance demand across city pairs so as to avoid local monopolies (ie. Minneapolis and Delta/Northwest) and ensure universal service. Deregulation broke all of that, so we have price competitions at the cost of a race to the bottom in service and industry cycles of bankruptcy and consolidation. Long term, that means monopoly levels of service and pricing.
  - getpost 11y ago
    Huh? Airline deregulation since 1978 is one of the poster children for improved service to consumers. Any transportation business is inherently subject to the flux of fuel prices and demand as it varies with overall economic activity. If anything, difficulties airlines now face are compounded by the degree of regulation that is still in force.

pbreit 11y ago

I don't think this is any ole foreign ownership laws. There's a national security interest among other things.