BUSINESS NEWS FEBRUARY 16TH, 2016
AMERICAN AIRLINES SUES OVER SLOW WI-FI
American Airlines recently filed a lawsuit against its in-flight Wi-Fi provider, saying that Gogo’s service was not up to par. The airline company went on to say that Gogo’s competitor, ViaSat, provides connectivity that “materially improves on Gogo’s air-to-ground system”. In response, Gogo released a statement which declined to comment on the “merit” of American’s accusations. Should American Airlines decide to switch up its Wi-Fi provider, it would have to reformat 200 out of 800 planes.
FED POLICYMAKER PROPOSES BREAKING UP BANKS
As the newly minted head of the Minneapolis Fed, Neel Kashkari suggested on Tuesday that lawmakers need to take on bold, transformational agendas by breaking up Wall Street banks. In a tone similar to Senator Bernie Sanders, Kashkari said that many banks are still too big to fail and as such, pose a significant threat to the U.S. economy. Kashkari further argued that we need to push past the set of regulations known as Dodd Frank, and take bold steps towards breaking up banks
BOEING PROTEST OF NORTHROP BOMBER CONTRACT REJECTED
In October 2015, Northrop Grumman Corp was awarded a multibillion bomber contract. Following the decision, airline manufacturer Boeing and Lockheed Martin Corp filed a joint protest to the U.S. Government Accountability Office. However, the GAO rejected the protest, saying it found no grounds on which to withdraw the contract, valued at $80 billion, from Northrop. Boeing has said it would decide what to do in the following days, as it still has the option to challenge the contract in federal court.
IMPACT OF TED CRUZ’S TAX PLAN
In the South Carolina debate, Texas Senator Ted Cruz made a seemingly outrageous promise; with his tax plan, Americans would be able to do their taxes on a postcard. While this is an exaggeration, Cruz’s tax plan is exceedingly simple, according to Director of the Tax Policy Center Len Burman. Cruz plans to impose a single flat rate on wages and salaries and a single broad based consumption rate for corporations. Analysts say that Cruz’s plan would result in an explosion of national debt, adding up to $20 trillion dollars in the next two decades.