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U.S. Airline Bailout Looks Uncertain as President Trump Stops Negotiations on $2.4 Trillion Stimulus Bill

U.S. Airline Bailout Looks Uncertain as President Trump Stops Negotiations on $2.4 Trillion Stimulus Bill

An extension on federal payroll support for tens of thousands of U.S. aviation workers looked increasingly in doubt last night after President Trump made a surprise move to abandon negotiations on a wider $2.4 trillion Coronavirus stimulus bill. Hidden within the CARES Act 2 bill is a $25 billion package that would stop involuntary airline furloughs through to the end of March 2021 that aviation workers had been hoping would be passed in the coming days.

But on Tuesday night, Trump said in a series of Tweet’s that he had instructed his representatives to stop negotiations with the Democrats until after November’s Presidential election. The initial round of payroll support finished abruptly on October 1, forcing around 45,000 workers onto involuntary furlough without pay or health benefits.

Despite the program coming to an end, negotiations had been ongoing between House Speaker Nancy Pelosi and Finance Secretary Steven Mnuchin with hopes that the current impasse would be resolved within days. Both American Airlines and United say they will reverse the current furloughs if the payroll support program is extended.

And while Southwest Airlines has so far managed to avoid involuntary furloughs, chief executive Gary Kelly is now asking employees for concessions on pay and benefits. He has promised to abandon those demands if Congress passes a second bailout.

Creating even more confusion, President Trump later took to Twitter again to demand the House and Senate “IMMEDIATELY Approve 25 Billion Dollars for Airline Payroll Support”. Trump said there was leftover money from the original CARES Act which could be used to fund the program without delay.

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Reacting with disbelief to last night’s developments, the Association of Flight Attendants (AFA-CWA) said Trump had managed to “blow up” the deal with just one Tweet.

“We will not stand by while our flying partners are without paychecks and healthcare, nor will we accept inaction by Congress when they owe us certainty for doing our jobs to keep the country connected,” the union, which represents flight attendants at United and 19 other airlines, said in a statement late on Monday.

The flight attendant union at American Airlines, which like United has been hardest hit by involuntary furloughs, urged its members to “keep fighting” for an extension of payroll support. “Flight Attendants are struggling. American workers are struggling. Our elected officials should not be turning their backs on the American people,” an internal memo read.

“The President does not control what Congress does,” the memo continued as the union implored members to keep putting pressure on lawmakers to approve the bailout.

Despite some concerns over whether the payroll support program actually provides value for money, there is widespread bipartisan support for an extension. If it does get approved, the program would secure aviation jobs through to the end of March 2021. At that point, it’s hoped a vaccine for COVID-19 will have been approved and demand for air travel will have substantially recovered.

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