The U.S. airline industry has seen $7.4 billion in direct federal aid since the terrorist attacks of Sept. 11, 2001, as well as $9.7 billion in pension claims transferred to taxpayers since industry deregulation in 1978. But now it may have finally met its match in lobbying power here: national security.

That realization is becoming clear this month as the Obama administration finally disclosed the reasons behind its drive to establish a preclearance facility at Abu Dhabi International Airport in the United Arab Emirates (UAE), an airport not served by any U.S. carrier. The facility is a sop to Abu Dhabi's emirs and their Etihad Airways, U.S. airlines say, asserting that such a facility would drain their most profitable revenue stream—international travel—weakening them and their domestic service. But federal officials see much more at stake, starting with containing Iran and boosting U.S. exports, as well as perhaps strengthening the defense industrial base.

“There are many aspects of the economic piece that are not just focused on the concerns expressed by the U.S. carriers,” says the acting deputy commissioner of the U.S. Customs and Border Protection (CBP), Kevin McAleenan. “Preclearance in Abu Dhabi will enhance U.S. security objectives and continue to build on a strategic partnership with the UAE, a key ally in the Middle East.”

In both his prepared testimony and live remarks to a Republican-controlled House Foreign Affairs subcommittee July 10, McAleenan reiterated perceived benefits to U.S. aviation and national security from the preclearance facility, and he described the cost efficiencies of screening and stopping suspect travelers in the Middle East rather than in the U.S. He also directly countered that U.S. airline concerns should be paramount.

But those U.S. carriers, represented at the hearing by Airlines for America (A4A) CEO Nicholas Calio and Air Line Pilots Association (ALPA) International President Lee Moak, also stood by their strong objections to the preclearance facility. They called on Congress to stop creation of it and invest more money in reducing customs wait times at U.S. airports, in addition to more general support for U.S. industry in light of growing state-sponsored competitors worldwide.

“The establishment of a preclearance facility in Abu Dhabi is a competitive game changer that is advantageous to foreign competitors,” Calio says. “At a time when U.S. carriers and airports are fighting to maintain our global competitiveness, the U.S. government should not be signing a deal with the UAE that benefits a foreign emirate and its wholly owned national carrier. This deal clearly puts U.S. airlines and U.S. international hub airports and their employees at a competitive disadvantage, and it will only get worse.”

Members of the terrorism, nonproliferation and trade subcommittee showed obvious biases for or against implications of the deal in their questions to the witnesses, but many also expressed a desire to learn more about the issue, and no clear consensus developed during the hearing in opposition to or supporting the administration's move. The issue has been building since 2011 but climaxed April 15, when the UAE and CBP signed a deal for the facility.

McAleenan said Abu Dhabi ranks in the top 10 origination airports for travelers who are positive matches to the Terrorist Screening Database. However, fewer than 5% of refused travelers arriving in the U.S. on flights from Abu Dhabi in the last two years were Emirati citizens; most were transit passengers from India, Saudi Arabia, Pakistan and Bangladesh. Establishing security processes at the point of departure clears the way for other passengers arriving at New York's John F. Kennedy International Airport, Chicago O'Hare International Airport and Washington Dulles International Airport. “If these processes can be accomplished in Abu Dhabi, it not only removes the burden from CBP officers at these key domestic airports, but those CBP officers can devote time and attention to other travelers,” McAleenan said.

Moreover, the UAE airport authority has offered to reimburse the CBP for the full cost of operation to the extent authorized by U.S. law—or about 85% of U.S. costs associated with immigration and agriculture-related inspection activities—and the U.S. “will seek reimbursement for all allowable costs,” he said.

Left largely unstated at the hearing, but looming in the background, is the military cooperation and foreign military sales at stake, too. “That cooperation has taken on numerous dimensions, including purchase of advanced missile defense capabilities designed to counter Iranian ballistic missiles, as well as U.S. military deployments intended to demonstrate resolve to Iran,” states a June report from the Congressional Research Service (CRS).

The U.S. military presence in the UAE comprises mostly Air Force personnel and assets, deployed primarily at Al Dhafra AB, 20 mi. south of Abu Dhabi, and revolve around mostly KC-10 aerial refuelers, according to the CRS. But in April 2012, “possibly to signal additional resolve over Iran's nuclear program,” the CRS states, the U.S. deployed several Lockheed Martin F-22 Raptors to Al Dhafra, and U.S. forces in the UAE have since then only increased.

But all of that is little comfort for A4A and ALPA. “According to [U.S.] officials, plans exist to open several more preclearance facilities in the Middle East shortly after the planned opening of Abu Dhabi [airport],” Calio says. “The U.S. government is essentially facilitating our foreign competitors' strategy.”

Although they have been invited, no U.S. carriers fly to Abu Dhabi because it is not profitable, Calio explains, but Etihad is more concerned with growth and attention. “Granting the UAE a preclearance facility makes it easier to enter our country if you fly through Abu Dhabi than it is if you fly directly into JFK, Houston, Miami, Chicago or Dallas—or any other U.S. city,” he says.

And Calio stresses that the impact could hit close to home for lawmakers. “Our higher yields on international traffic are what enable us to provide subsidized—read 'unprofitable'—service to small- and medium-size communities that so many members of Congress want served,” he says. “Make no mistake: Etihad will not be providing service to Des Moines, Cleveland or Pittsburgh. And yet, with this facility, our own government is effectively picking winners and losers in the global market.”