Democratic leaders are competing for Delta’s favor after a top Georgia Republican threatened the airline by vowing to kill state legislation that would hand it a lucrative tax cut.
The showdown between Delta and Georgia Republicans began this week, after Delta announced it would stop offering discounted fares to National Rifle Association members. On Monday, Georgia’s Lt. Gov. Casey Cagle demanded the Atlanta-based airline — one of the state’s largest employers — either restore the benefit or watch Republican lawmakers strike down a $50 million sales-tax exemption on jet fuel, of which Delta would be the primary beneficiary.
The bill granting the jet-fuel tax exemption was easily approved in the House last week, and appeared to have wide support, as advocates say it would attract flights to Atlanta as opposed to other major airports, where jet-fuel taxes are charged. But in the days since Delta’s announcement, other Georgia Republicans have rallied behind Cagle, and the Senate Rules Committee on Wednesday voted to remove the tax exemption from the larger tax-cut package.
Gov. Nathan Deal (R) said he would reluctantly support the measure because of the bill’s broader cuts to the state’s income tax rate, according to the Atlanta Journal-Constitution.
Now, top blue-state politicians are encouraging Delta to relocate its hub from Atlanta.
“@Delta, if Georgia politicians disagree with your stand against gun violence, we invite you to move your headquarters to New York,” said New York Gov. Andrew M. Cuomo (D) in a tweet Tuesday.
Cuomo’s remarks echoed those of the state’s lieutenant governor, Kathy Hochul (D), who on Monday noted that New York “is open for business” and suggested that the airline should move its headquarters to “where you’re appreciated.”
The lieutenant governor of Washington, Cyrus Habib (D), thanked Delta for cutting ties with the NRA, adding that his state would be a lovely place to do business. And Virginia Gov. Ralph Northam (D) tweeted “Hey @delta — Virginia is for lovers and airline hubs. You’re welcome here any time.”
The widespread invitations to Delta by Democratic leaders make it seem as though the airline is the next “Amazon HQ2,” as several U.S. cities are also jockeying for Amazon’s business — offering giveaways like low taxes, land handouts and infrastructure improvements — after the company announced 20 finalist locations for its second headquarters. (Amazon chief executive Jeffrey P. Bezos owns The Washington Post.)
One of those cities happens to be Atlanta, in part because of its major airport. But experts now say Georgia Republicans may have jeopardized the city’s bid with their threat to Delta.
“This could absolutely give Amazon pause,” Neeraj Arora, a marketing professor at the Wisconsin School of Business, told CNN Tech. “The company has taken a stance on social issues in the past.”
Delta joined United Airlines, Best Western, MetLife and at least a dozen other companies in cutting discounts and perks for NRA members amid the national gun-control debate after the deadly Valentine’s Day shooting at Marjory Stoneman Douglas High School in Parkland, Fla. Advocates of the #BoycottNRA movement are now determined to convince tech giants such as Apple, Google, Roku and Amazon to stop streaming NRA-produced videos, though none have announced plans to do so.
Delta has not commented on the threat from Cagle, who says he is “a lifelong member of the NRA” and boasts that he has earned an A+ rating from the organization every year he has served in elected office. Cagle, who leads the Georgia state Senate and has served as the state’s lieutenant governor since 2007, could weave the issue into his campaign in Georgia’s upcoming gubernatorial race, in which he is considered the leading GOP contender to replace Deal.
The NRA has lashed out at the boycott movement, saying the companies that dropped the discounts were participating in “a shameful display of political and civic cowardice.” But the group also downplayed the importance of the company’s actions, saying the “loss of a discount will neither scare nor distract one single NRA member from our mission.”
Whether Georgia Republicans leaders’ threats are empty ones will become clear when the full Senate votes on the tax exemption this week, according to the Atlanta Journal-Constitution. It’s unusual for Georgia’s Republican leaders to oppose tax breaks for a major corporation — especially when that tax break could provide an economic boost, said Chuck Bullock, a political-science professor at the University of Georgia.
Some have questioned whether the government can punish a private company over its politics. The answer, according to ethics experts, is that they likely can, and that this sort of intimidation happens often in legislative bodies across the country.
Emory Law School Dean Robert Schapiro told The Washington Post’s Amber Phillips that before any legal challenge could be raised, a clearer quid pro quo — you said this; therefore, the government is doing that to you — would have to be shown.
“If the Georgia legislature said, ‘We’re going to impose a tax against people who speak out on gun control, or a tax against people who say they oppose the NRA,’ that would clearly be unconstitutional,” Schapiro said.
Still, a Democrat in the Georgia gubernatorial race says Cagle may have broken anti-corruption laws by threatening Delta. Stacey Evans on Wednesday asked Georgia Attorney General Chris Carr to investigate Cagle’s remarks and see whether the lieutenant governor broke bribery or extortion laws.
No matter what happens, experts say it’s unlikely Delta will respond to the invitations of Democratic state leaders by moving its hub.
“It’s not like [Delta] can pack up and move somewhere else. This is their major hub,” said Bullock, the University of Georgia professor.
As Bloomberg reported in an article ed, ‘Delta isn’t leaving Atlanta, so please stop talking about it:’
Delta virtually “owns” the world’s busiest airport. Sure, the city is technically the landlord, but nothing of much import happens at Hartsfield without Delta’s say-so. Part of this influence derives from location, seeing as it’s headquartered right next to the runways. Another source of power is the estimated $71 billion in annual economic impact that Georgia enjoys from Hartsfield, which claims to be the state’s largest employer. Moreover, less than two years ago, Delta signed a 20-year lease to stay in Atlanta, its home for the past 77 years.
Although Delta ended its alliance with the NRA, the company said its position on the gun-control debate remains neutral. “Out of respect for our customers and employees on both sides, Delta has taken this action to refrain from entering this debate and focus on its business. Delta continues to support the 2nd Amendment,” the airline said in a statement Saturday.