Friedman and tragedy at Kuwait Airways

This news has been read 9530 times!

When reading the tweets of some deputies, I feel that they are looking for anything that will allow them to tell their constituents, ‘Hey, look we are here,’ just to stay in the spotlight! News spread on social media, quoting Al-Rai newspaper, stating that Jazeera Airways is ready to buy 35% of Kuwait Airways. Representative Shuaib AlMuwaizri hastened to issue a statement denouncing the attempt to acquire the “national carrier” and warned the government against the consequences of approving the deal.

Then it became clear that the news dates back to 8 years, and the deputy should not have believed it in the first place, as this news lacks logic in the first place. The other distinguished MP, Fayez Al-Jumhour, also confirmed the news, condemning it and anyone who seeks to harm the reputation and credibility of Kuwait Airways, and threatened to interrogate the Prime Minister. I do not know what is the relationship of the Kuwait Airways credibility and reputation with the good intention of a party to buy 35% of it?

The belief in the news about the purchase shows their understanding of things! What Shuaib does not know, or who wants to buy an asset like the Kuwaitia, is that neither its financial conditions nor its functional structure nor the quality of its aircraft, nor anything in it tempts to buy it, because the size of its problems is greater than the ability or strength of any president or board of directors who manages the company, as it represents the shining model. What the “government joker” Minister Saad AlBarrak warned against was that the government is a failed merchant, as its losses began in the early years of its establishment, and it is said that it cost public money more than $35 billion over 70 years, with repeated raising of its capital and write-off of its loans! What Al Muwaizri or any party aiming to buy assets of Kuwait Airways is that the latter cannot attract anyone to buy it because of several facts concerning its financial conditions, job organization and the aircraft.

The troubles of Kuwait Airways are beyond the capability of any chairman or board of directors to tackle. Kuwait Airways is a real model of what Deputy Prime Minister, Minister of Oil, State Minister of Economic and Investment Affairs and Acting Minister of Finance Saad Al Barrak when he said the government is a failed trader. Losses of Kuwait Airways have started too early since it was established. It is said that it cost the national economy over KD 35 billion in 70 years and through increasing its capital and writing off its loans.

Outstanding and genius US economist Milton Friedman who won Nobel Prize in 1976 and whose theories concerning free economy and political freedoms are adopted by several countries such as Chile, Estonia, India and Hong Kong said the failure of a private sector company ends up with bankruptcy and dissolution. He added that the opposite happens with public sector companies pointing out that in such a case, the government pumps money to the company’s capital ignoring its frequent failure. This is exactly what happened with the Kuwait Airways which no one knows definitely how much it cost the Treasury and how big is the corruption committed there.

Such circumstances made it impossible for the honest chairman and most sincere board of directors to reform it especially with the firm domination by Muslim Brotherhood followers backed by their MPs. One of the evidences supporting my vision is the failure to promote the workers or dispose of the useless employees. In the light of the above mentioned facts, the MPs who threatened to grill HH Prime Minister should be grateful to any party willing to buy Kuwait Airways. If I were in charge, I would accept the offer and furthermore, I would pay compensation to the buyer instead of making him pay the price to the State.

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e-mail: [email protected]

By Ahmad alsarraf

This news has been read 9530 times!

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