Two of the largest passenger airlines in the United States plan to furlough 32,000 employees this week unless Democratic leaders and Trump administration officials manage to reach an agreement on stimulus package talks.
American Airlines plans to furlough over 19,000 works beginning on Thursday due to low demand for travel but is willing to reverse itself should a stimulus deal be reached that includes $25 billion for the airline industry, according to the Associated Press,
United Airlines, which plans to furlough over 13,000 jobs, also indicated that the employee furloughs would be canceled if Washington reached a stimulus package deal soon, reports The Wall Street Journal.
According to The Associated Press, the airline industry has been encouraging employees to take early retirements or severance packages in order to curb spending. However, the industry still employs a workforce larger than needed to meet current demand for flying, which is down 70% from last year and not expected to return to pre-coronavirus pandemic levels for at least three years.
The airlines are requesting funding in order to keep their workers on payroll through March of 2021, reports AP. Congress previously provided the industry with $25 billion to avoid layoffs through September 2020.
Treasury Secretary Steven Mnuchin and House Speaker Nancy Pelosi (D-CA) have been engaged in renewed coronavirus stimulus talks this week, after failing to reach an agreement back in August due to differences on the magnitude of desired spending.
Democratic leadership had been using the Heroes Act, a $3.4 trillion dollar stimulus package passed in the House, as a point of negotiation. Republicans were intent on capping spending at $1 trillion, and even then, many GOP senators weren’t sold on it.
Mnuchin said Wednesday evening that the Trump administration is on-board with new funding for airlines, but he also suggested the president wouldn’t be willing to spend more than $1.5 trillion on another stimulus package, reports AP.
During a Monday interview on MSNBC, Pelosi argued that because Democrats had lowered their spending by about $1 trillion, it was time for Republicans to “come up because we have to crush this virus,” according to Politico.
The WSJ, citing Democratic aides, reports that House Democrats originally planned to vote on the new spending bill on Wednesday, ahead of an expected recess, but have since postponed the vote to allow another day for the ongoing negotiations.
“We found areas where we are seeking further clarification,” said Pelosi. “Our conversations will continue.”
On Wednesday evening, Mnuchin told reporters that the negotiators have made “a lot of progress over the last few days,” reports The Washington Post.
“We still don’t have an agreement, but we have more work to do. And we’re going to see where we end up,” he said.
The current Democratic-favored House bill, as it stands, has virtually no chance of passing the senate and has been dismissed by Senate Majority Leader Mitch McConnell (R-KY) as a political stunt, according to NPR. As such, a breakthrough in negotiations between Pelosi and Mnuchin will be necessary for a new stimulus package to have a chance at moving toward the president’s desk for signature.