The thing about the dreaded "cross-subsidization" is the need to get beyond emotion and understand the difference focus between "economies of scale" vs "economies of scope".
The latter, put simply says that if an organization is already producing a suite of products in a particular field then it should be cheaper for them to start up a kindred operation that it would be for a third party to start up a "green fields" operation. There are many examples of this. You could even look at the Army.....they can run the SAS much more efficiently and cost effectively than if it were a separate stand alone structure. Does the regular Army subsidize the SAS? Or vice versa? Or is it simply a strength of the Army as a whole that it can do both things better than the sum of two stand alone outfits?
I really do hesitate to suggest that uninformed speculation and comment detracts from rational debate but I fear this is one of those cases where lack of understanding, fuelled by emotion, has led to unwarranted fear and loathing of JQ.
Anyone who really believes that by itself, on its superior brand name and capabilities alone, QF could have held off other LCCs.....is simply wrong. Compass Mark 1 had the old AN within days of bankruptcy. Southwest and Jet Blue continue to have the US majors reeling.
However poorly it was explained, and however much there may be some drooling ideologues who just love to "divide and conquer", and however annoying it is to see shiny jets and promotion rates you'd love to have had......the fact is that it is a business strength that QF could set up JQ and run it so that QF (domestic) and JQ between them are far stronger than had they been stand alone. And in any case, had someone else started up JQ they would have had no compunction in running directly against the CityFlier services, something JQ largely does not do, for the good of the whole Group.