Live from Music Row, Tuesday morning on The Tennessee Star Report with Michael Patrick Leahy – broadcast on Nashville’s Talk Radio 98.3 and 1510 WLAC weekdays from 5:00 a.m. to 8:00 a.m. – host Leahy welcomed Open the Books Founder and CEO Adam Andrzejewski to the newsmaker line to talk about how Southwest Airlines mismanaged $7 billion in federal government subsidy ultimately resulting in a Christmas nightmare.
Leahy: On the newsmaker line right now, Adam Andrzejewski. I kind of get that last name wrong. I don’t think I’ve got it right yet. He’s the head of Open the Books.
He’s going to talk about the $7.2 billion in subsidies that Southwest Airlines got from the federal government in 2021. Didn’t help him get the flights off the ground this Christmas. Adam, welcome to The Tennessee Star Report.
Andrzejewski: Great to be on the program, Michael. Thanks for having me on.
Leahy: Tell us briefly, what is Open the Books.
Andrzejewski: So at openthebooks.com, we believe that you should be able to follow the money. And to that end, last year we filed 50,000 Freedom of Information Act requests. It was the most in American history, and we captured trillions of dollars worth of federal, state, and local spending.
So right there in Tennessee, in Nashville, or across the country, you can see in your school districts, in your local units of government state all the way to Washington, D.C. exactly how your tax dollars were spent.
Leahy: Seven point two billion dollars of those tax dollars apparently went directly to Southwest Airlines in 2020 and 2021. I was on a flight scheduled from Nashville to Phoenix on Thursday, the 22nd. At we boarded the plane at 12:40 p.m. and then at 12:50 p.m., they told us that the flight had been canceled, so we got off the flight.
That was just the beginning of my own personal Southwest odyssey. And yet they got $7 billion. They claimed the problem was that their internal system didn’t work. For $7 billion, don’t you think they could get their internal system to work?
Andrzejewski: It’s absolutely amazing. Our auditors that openthebooks.com, we nailed that number. Members of Congress or staff, they were tweeting how much federal money, taxpayer money, went to Southwest since the pandemic started in 2020? We immediately dug in. Southwest, took my bags.
My bags flew to Miami, my family didn’t, and our flight was canceled after we checked our bags. So we wanted to answer that question. And it was $7.2 billion of congressional bailout. It’s a stunning number. Southwest has 54,000 employees.
All of this money was supposed to be used for payroll and benefits for the employees. That’s $133,000 on average per employee. So what that means is that taxpayers covered an entire year’s worth of payroll during the pandemic for Southwest. Michael that frees up a lot of money in the budget to use unimportant upgrades like your 1990 infrastructure that needed an upgrade.
But here’s what they did with the money. They expanded the new hubs to new airports. They didn’t upgrade the foundational IT infrastructure. For example, right here in Chicago, they expanded to O’Hare. They already had Midway, so they expanded operations and they didn’t take care of core infrastructure.
Leahy: The problem seems to me to be one of the management decisions. Bob Jordan, the new CEO, came in 11 months ago. I have to tell you, from a communications point of view as a customer, their communications at the gate and everywhere were nonexistent.
Andrzejewski: It was nonexistent.
Leahy: It was a horrible experience, frankly.
Andrzejewski: We got our cancellation six hours after we left the airport after the flight was canceled. We finally got our cancellation six hours later.
Leahy: Did you get your bags back?
Andrzejewski: No. One of the six bags we have back, four they found in Atlanta, of all places, they’re being FedEx back to us and one, still nobody knows where it is.
Leahy: Now Bob Jordan, the new CEO, came in. He’s not a pilot. He supposedly got a computer background. He was a Texas A&M grad. I was unimpressed by the way he responded to this. He sounded, frankly, more than a little bit condescending in the way he was communicating about this to me. Your thoughts?
Andrzejewski: It did take him a long time to get to the apology. That first response, the apology came at the end. Finally, he issued a response where he said, there was a total apology. It took him a long time. You’re exactly right. And here are the questions for Congress. They’re going to hold hearings. He’s going to have to testify.
Our auditors noticed that starting 2021. Two years ago, Michael, two years ago, before you and I got on those Christmas flights that never were, they had $14.3 billion of cash on hand in the bank in the first quarter of 2021. Nearly two years ago, they were the first airline to declare a profit of $116 million in the quarter.
So with a huge taxpayer bailout of $7.2 billion, Southwest received a lot from all of us, from taxpayers, so they owed us a lot, and they canceled 15,000 flights. That’s about 1.5 million travelers that they stole Christmas from.
Leahy: The airline that stole Christmas, I think that’s a book coming out for next Christmas. It doesn’t have a happy ending yet to me. And you hear Pete Buttigieg get out and say, we’re going to fine Southwest Airlines. Pete, the secretary of transportation. He got warnings of this, like, 10 months earlier, did nothing about it.
But to me, I think this is a simple solution. You fire the CEO, Bob Jordan, and you get somebody in there that actually can build an IT system that works. Your thoughts, Adam?
Andrzejewski: Yes. I mean, shoot, you’re an airline. The nation depends on you. I mean, there were soldiers that couldn’t get home for leave and leave as rare as you know, in the military and treasured for Christmas to see their families.
There were people sharing their stories on the Southwest Instagram page that they missed their father’s funeral. The stories are heartbreaking, so there has to be accountability.
Leahy: Will Bob Jordan, the CEO of Southwest Airlines, survive in that role?
Andrzejewski: That’s an open question, right? He’s only been on the job, he’ll make the argument for 10 months. Going back at least a decade. You’ve got your flight attendants, your baggage handlers, and your pilots warning the company about its aging infrastructure. This was not a secret at Southwest Airlines.
This was open and on the table. They decided to use their budget to expand operations rather than take care of an aging IT infrastructure. They couldn’t even handle their existing footprint. They were expanding their airport footprint.
Leahy: How much is Bob Jordan make as CEO of Southwest Airlines?
Andrzejewski: I think it’s paid because of the pandemic subsidies. That’s a good question, but I believe I read that it was capped in the legislation at $3 million. He’s not in the poor house. It’s $3 million. Okay?
So, look, like I said, they owe us a lot. They took a lot from taxpayers. They owe us a lot. And, Michael, you and I were living examples. We didn’t get a good return on our taxpayer investment.
Leahy: Adam, if we’re a year from today, what do you think is going to happen with Southwest Airlines a year from today? Where will Southwest Airlines be?
Andrzejewski: It gives me hope that I mean, look, it’s bipartisan, that there has to be accountability. So Bernie Sanders tweeted our number $7.2 billion in subsidy, and he wants accountability.
And on the right, Nancy Mace the House Republican, called for a forensic audit of our number, the $7.2 billion of taxpayer money into Southwest when they couldn’t keep a plane in the air for Christmas.
So hopefully we’re going to have some bipartisan accountability brought to Southwest. But I have to say, people are loyal. I’m flying Southwest to Washington, D.C. today. I’ve got, like, 400,000 points. And I’ve always liked the airline. I’m flying them today.
Leahy: I loved the airline when Herb Kelleher was running it. The late great Herb Kelleher.
Listen to today’s show highlights, including this interview:
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Tune in weekdays from 5:00 – 8:00 a.m. to The Tennessee Star Report with Michael Patrick Leahy on Talk Radio 98.3 FM WLAC 1510. Listen online at iHeart Radio.
Photo “Adam Andrzejewski” by Adam Andrzejewski. Background Photo “Southwest Airlines” by Tomás Del Coro. CC BY-SA 2.0.
