Editorial: National’s departure will hurt

Friday, Nov. 8, 2002 | 9:25 a.m.

Anyone who doubted National Airlines' importance to our city only has to look at what happened to airline fares after the Las Vegas-based airline shut down Wednesday. Fares on many routes that National used to fly rose 50 percent or more immediately after National ceased operations, and fares could increase even more.

In a sluggish national economy, visitors will think twice about coming to Las Vegas if airline fares rise significantly. The loss of National also means there will be fewer direct flights here, an inconvenience that also is a drawback for potential visitors. National's competitors say they will pick up some of the flights National once had, but they certainly won't come close to filling the void created by National's absence.

National, which had been operating in Chapter 11 bankruptcy, recently turned its first profit in a year, making $1.2 million in August. But National's fate was sealed earlier this year when the Air Transportation Stabilization Board rejected the airline's reasonable request for a modest $50.5 million loan guarantee. The loan was available under a program created by Congress to help the ailing airline industry recover after the Sept. 11 terrorist attacks, but the program has been suspect, with no consistency shown in what airline loans get approved. For instance, earlier this year financially struggling America West received a $429 million loan guarantee, money that National says was used in part to try to drive National out of business.

The federal loan guarantee board isn't alone in helping cause National's demise, though. Aside from Harrah's, which at one time was an investor in National, the gaming industry did virtually nothing to help the home-grown airline, a terribly shortsighted decision. Las Vegas -- and the casino industry too -- quickly will discover just how sorely we'll miss National.