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Trump’s bluff might help save U.S. airline industry

Sibile Marcellus
·Reporter
·4 mins read

President Trump has literally written the book on the “Art of the Deal,” but his latest negotiating ploy to get a skinny coronavirus stimulus bill for airlines approved by Congress has left top Democrats puzzled.

House Speaker Nancy Pelosi even went as far as to question whether he’s suffering from the side effects of his ongoing coronavirus medical treatment.

Trump is pushing for a standalone bill to help the airlines as well as one to help small businesses. “The House & Senate should IMMEDIATELY approve 25 Billion Dollars for Airline Payroll Support, & 135 Billion Dollars for Paycheck Protection Program for Small Business. Both of these will be fully paid for with unused funds from the Cares Act. Have this money. I will sign now!” he tweeted late Tuesday night amid a barrage of tweets over the past day.

Perhaps Trump was bluffing when he tweeted Tuesday that he was ending coronavirus stimulus negotiations, dragging stocks lower. “I have instructed my representatives to stop negotiating until after the election when, immediately after I win, we will pass a major Stimulus Bill that focuses on hardworking Americans and Small Business,” he tweeted.

Pelosi was quick to respond, saying Trump “showed his true colors” and that he “refused to put money in workers’ pockets, unless his name is printed on the check.”

House Speaker Nancy Pelosi of Calif., speaks during a weekly news conference, Thursday, Oct. 1, 2020, on Capitol Hill in Washington. (AP Photo/Jacquelyn Martin)
House Speaker Nancy Pelosi of Calif., speaks during a weekly news conference, Thursday, Oct. 1, 2020, on Capitol Hill in Washington. (AP Photo/Jacquelyn Martin)

As negotiations for airline relief continued on Wednesday, Pelosi seemed to indicate she’d be open to helping the airlines. Pelosi’s spokesman tweeted that Treasury Secretary Steven Mnuchin asked Pelosi about a standalone airlines bill. “The speaker reminded him that Republicans blocked that bill on Friday & asked him to review the DeFazio bill so that they could have an informed conversation,” the spokesman said.

Trump also pushed for a new round of stimulus checks for individuals. “If I am sent a Stand Alone Bill for Stimulus Checks ($1,200), they will go out to our great people IMMEDIATELY,” he tweeted. But Pelosi has been resistant to the idea of piecemeal fiscal support.

As negotiations drag on, job losses in the U.S. airline industry continue to pile up.

Delta Airlines (DAL) is the next major U.S. airline poised to furlough thousands of employees by Nov. 1 if lawmakers fail to strike a deal with the White House to provide the industry with a $25 billion bailout.

In the absence of another round of financial relief, Delta is negotiating with the ALPA pilots’ union to avoid the furlough of 1,721 pilots next month.

Although American (AAL) and United Airlines (UAL) laid off more than 32,000 employees last week, Southwest Airlines (LUV) held off and reaffirmed its commitment to its employees to avoid layoffs or furloughs through the end of the year.

Photo by: John Nacion/STAR MAX/IPx 2020 8/26/20 A view of a Delta Airlines aircraft lining up La Guardia Airport for take off during Coronavirus pandemic on August 26, 2020. Delta Air Lines to furlough nearly 2,000 pilots in October, report says.
A view of a Delta Airlines aircraft lining up La Guardia Airport for take off during Coronavirus pandemic on August 26, 2020. Delta Air Lines to furlough nearly 2,000 pilots in October, report says. (Photo by: John Nacion/STAR MAX)

Southwest CEO Gary Kelly’s base salary has already been reduced to zero in 2020 and will remain at that level through the end of next year. The base pay of the airline’s most senior executives will remain reduced by 20% through 2021.

While Kelly saves his employees’ jobs, the company said this week its non-union employees’ pay would be cut by 10% through 2021. The airline is hoping to convince labor unions to make similar concessions.

Airlines for America President and CEO Nicholas Calio said the industry was “disappointed that Congress and the Administration have been unable to reach an agreement that would save tens of thousands of highly skilled, quality jobs in the U.S. airline industry. We will continue to encourage all parties to get back to the table and conclude a deal. We have to hold out that hope,” he said.

The airline industry is in dire need of fiscal support. The International Air Transport Association estimates that “despite cutting costs just over 50% during the second quarter, the industry went through $51 billion in cash as revenues fell almost 80% compared to the year-ago period.”

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