Delta began the nonstop Paris flights three years ago under a $9 million subsidy from the state and a regional economic group. The flights will again be offered from May to October next year, five days a week up from four this year.
Emphasis added. I don't want to overshadow the contribution from the "regional economic group." My aim is to highlight Pennsylvania's ante. As I related on Saturday, that's not the only love that Governor Tom Corbett has showered on Delta:
In a move from somewhere out in left field, Delta Air Lines decided in late April to tackle energy risk management head-on by taking a rather unorthodox step of managing their fuel cost exposure by…purchasing a refinery. $150 million later (after a $30 million subsidy from the Commonwealth of Pennsylvania), Delta bought the Trainer refinery just south of Philadelphia, which produces 185,000 barrels a day. In addition to the purchase, they are now retrofitting the refinery (to the tune of $100 million) to maximize its jet fuel output.
Emphasis added. Are the two subsidies related in any way? The point I was trying to make this weekend concerns funding education, which is taking a big hit around the country (not just in Pennsylvania). That's a lot of love for one company given the fiscal constraints of the day. The better return comes from investing in people, not chasing smokestacks.
The cynic in me sees the refinery deal as an exchange for direct flights to Europe. The two might seem unrelated save for Pennsylvania giving two subsidies to Delta Air Lines. That's a sweet deal for Delta. I'm not sure Pennsylvania gets much out of it.
Whether the two are linked or not, the policy still stinks. Pennsylvania should be doubling down on education, not pandering to CEOs. Corbett is mortgaging the future for a few shiny political pieces that he can cash in now. Delta's shareholders should not have a vote in the next gubernatorial election.