McConnell’s plan for coronavirus airline industry relief draws grumbles on all sides
Senate Majority Leader Mitch McConnell’s $50 billion proposal to help the struggling passenger airline industry withstand business interruptions during the coronavirus pandemic is causing consternation on all sides of the debate.
The Kentucky Republican’s opening offer falls short of what the industry thinks it needs in order to cope with the financial fallout from the global pandemic that is grinding air travel to a near halt.
“Loans alone are not sufficient,” said Katherine Estep, communications director for Airlines for America, the commercial airline industry’s lobbying group that had originally requested more than $50 billion in a combination of loans and grants to deal with the crisis.
The proposal also does not address concerns from many Democrats that any major relief for airlines should be coupled with a crackdown on certain airline practices they say are detrimental to workers and consumers.
“There is strong support in the House Democratic leadership for strict conditions that protect workers and prevent executives from, in effect, self-enriching,” said Sen. Richard Blumenthal, D-Conn., who is a member of the Senate Committee on Commerce, Science and Transportation.
The current legislative proposal unveiled Thursday night would bar airlines for two years from increasing executive compensation. President Donald Trump has also said he supports prohibitions on allowing executives to pursue stock buybacks as well.
But the bill as written would not, as Blumenthal and others have demanded, mandate certain worker protections or do away with anti-consumer practices like charging fees for flight changes and shrinking the space between seats on planes.
Meanwhile, some Republicans don’t want to vote on anything they see as tantamount to a “corporate bailout.”
“We should not bail out large corporations that have enjoyed years of growth and prosperity,” Sen. Rick Scott, R-Fla., wrote in an op-ed Wednesday. “I won’t support it.”
As Senators began negotiations Friday with the White House — the third congressional coronavirus relief package since the start of March — McConnell made clear he supported loans, not direct payments, to industries including airlines.
“We want to empower the Treasury Department to engage in targeted lending, not bailouts but loans to key sectors and industries which this pandemic is hurting,” said McConnell in a bid to address the concerns of bailout critics and temper expectations about his willingness to give airlines more than loans.
He also cautioned that not every priority would be incorporated in this coronavirus response bill, which could cost as much as $1 trillion when it is sent to the president to be signed into law.
“This will not be the first bill we pass to combat this crisis, or the second. And I do not expect it will be the last,” McConnell said. “This legislation does not need to contain every piece of ongoing national effort. In fact, that would be impossible.”
Democrats, who control the House, could insist on changes to the Senate Republican’s starting point on providing relief for airlines.
Earlier this week, Rep. David Price, D-N.C., the chairman of the House Appropriations Subcommittee on Transportation and Housing and Urban Development, said he thought airlines needed a combination of grants and loans to weather the current crisis.
Yet as the public health crisis takes a toll on the U.S. economy, industry lobbyists and members of Congress are looking to use their leverage now rather than later.
“The airlines are talking about their survival,” Blumenthal said, “and if they are candid and honest they’ll admit they need to do better by consumers and travelers and that these kinds of concessions are perfectly doable.
“If they’re requesting and receiving taxpayer money, they ought to do right by taxpayers, their customers.”
