Sen. Ted Cruz (R-TX) on Wednesday forcefully opposed the Trump administration’s emerging plan to bail out Spirit Airlines, labeling the proposal an “absolutely TERRIBLE idea” in a post on X. The Texas Republican, who chairs the Senate Commerce, Science and Transportation Committee, warned that the deal could leave the federal government owning as much as 90% of the struggling carrier, which has filed for bankruptcy twice in the past two years.
Cruz invoked the Troubled Asset Relief Program (TARP), the 2008 financial crisis bailout that saw the government purchase $443 billion in assets from financial institutions, with only $390 billion returned as of 2022, according to ProPublica. He called those corporate rescues a “huge mistake” and argued that the federal government “doesn’t know a damn thing about running a failed budget airline (that the Biden admin killed.” The latter reference was to a 2024 federal court decision—backed by the Biden administration and state attorneys general—that blocked a planned merger between Spirit and JetBlue.
Reports from Reuters indicate the administration is nearing a deal that could include up to $500 million in government-backed financing. President Trump, Transportation Secretary Sean Duffy, and Commerce Secretary Howard Lutnick met Tuesday to craft a plan to keep the airline afloat, according to The Wall Street Journal. During a Tuesday interview on CNBC’s “Squawk Box,” Trump said he would “love somebody to buy” the airline, adding, “It’s 14,000 jobs. Maybe the federal government should help that one out. I told my people.”
But Duffy raised significant reservations, telling Reuters, “What we don’t want to do is put good money after bad, and there’s been a lot of money thrown at Spirit, and they haven’t found their way into profitability. And so would we just forestall the inevitable and then own that?” He later added, “If no one else wants to buy them, why would we buy them?”
Cruz’s opposition is part of a broader bipartisan pushback on Capitol Hill. Sen. Tom Cotton (R-AR) wrote on X that if “Spirit’s creditors or other potential investors don’t think they can run it profitably coming out of its second bankruptcy in under two years, I doubt the US Government can either.” He called the plan “not the best use of taxpayer dollars.”
On the Democratic side, Sen. Elizabeth Warren (D-MA) blamed the war with Iran for “sky-high fuel prices that finally did Spirit Airlines in” and questioned what the American people would gain from the bailout, asking, “Will the failed airline executives be held accountable?” The administration’s broader engagement with Iran, including a fragile ceasefire set to expire Wednesday, has drawn scrutiny. For more on that, see: Trump Signals Ceasefire With Iran Will Expire Wednesday Without Deal.
The Texas senator’s stance aligns with his longstanding skepticism of federal intervention in private markets, a theme he has also applied to other issues. For context on how the Texas grid has been strained by data center demands—another area where Cruz has pressed for limited government—see: Texas Grid Overwhelmed by Data Center Demands, Exposing National Infrastructure Crisis.
As the administration weighs its options, the fate of Spirit Airlines—and the 14,000 jobs it supports—remains uncertain. The debate underscores a familiar Washington divide: whether government intervention can rescue a failing business without wasting taxpayer money or distorting markets.
