It's not a matter of air getting into the lines (which is easily prevented by having the discharge in the closed res below the waterline of the open res), but the amount of pressure inside the pump chamber.
As a pump impeller spins, it causes high pressure on the front of the little blades/paddles and low pressure on the backside (especially the tips). If the low pressure regions are below the vapor pressure of your water, the water gets "pulled apart" and forms little bubbles of water vapor - cavitation. As those little bubbles are thrown ******d with the discharge, they get into an area with higher pressure and collapse, which is noisy and cuts your discharge pressure. The energy that goes into the creation of those bubbles is wasted as heat and sound.
As drawn, your setup would have the pump inlet pressure below atmospheric pressure, whereas our pumps are designed for an inlet pressure at (or a few of cmH2O above) atmospheric. With that reduced pressure you risk cavitation.
Net Positve Suction Head, NPSH, having the inlet pressurized: pumps love it, so should you.
Edit: Why is the forum software censoring ******d (o-u-t-w-a-r-d) ?
Man, that is *****d up.
