Pelosi rules out aid for airlines without wider stimulus
House speaker raises the stakes after Trump says parties are talking again about aid for airlines and broader economic package
Washington — US House Speaker Nancy Pelosi said on Thursday there could be no action on a stand-alone bill to aid airlines or any other sector of the economy without an agreement with the White House and Republicans on a broader economic stimulus package.
Her remarks suggested that there would be no quick relief for airlines or resolution of the standoff over aiding the US economy, even as there are signs the recovery could weaken without further stimulus.
Pelosi has rebuffed President Donald Trump’s called for Congress to pass relief legislation piecemeal, though she said airline aid could move through Congress before a broader deal is voted on if there is a stimulus agreement.
“They just want money for the president to spend money on who knows what?” Pelosi said at a news conference. “There is no stand-alone bill without a bigger bill.”
Treasury secretary Steven Mnuchin broached the idea of continuing stimulus discussions during a call with Pelosi on Wednesday, one day after Trump announced on Twitter he was ending negotiations, according to a person familiar with the discussion.
Pelosi said in an interview that she drew the “inference” that Mnuchin was interested in broader stimulus talks and that she had confidence in the Treasury secretary. But she said the White House had not provided a full counter-offer to the $2.2-trillion plan that the House passed as the Democrats’ negotiating position.
“I’m always optimistic,” Pelosi said. “Maybe the president, seeing the reaction to his walking away from the table is the opportunity that we have for them to come back to the table for us to get an agreement — and the sooner the better.”
After accusing Pelosi on Tuesday of not negotiating in good faith, Trump has since changed course and urged trying for a deal on some individual aid packages. On Thursday, he told Fox Business that talks on an economic stimulus plan are now “starting to work out”.
Pelosi said she remains open to separate airline aid legislation. “I have made the case to my colleagues that this is a special case,” Pelosi said.
But she said that the country needs a comprehensive plan that would help stem the coronavirus outbreak and the airline package would have to be advanced in the “context” of a broader bill.
She was scheduled to have another round of talks by phone with Mnuchin later on Thursday.
Without additional aid, American Airlines will cut more flights in addition to jobs, said CEO Doug Parker. The carrier began implementing 19,000 layoffs last week.
“There will absolutely be discontinuation of service to small communities and there will be much less service to larger communities,” Parker said Thursday.
A Standard & Poor’s 500 gauge of airline stocks erased gains on the news of Pelosi’s remarks, and broader market indexes retreated from the day’s highs.
Despite Pelosi’s stance, Trump on Thursday claimed that multiple pieces of stimulus, including $1,200 individual cheques are on the table.
“We started talking again. And we’re talking about airlines and we’re talking about a bigger deal than airlines,” Trump said in the Fox Business interview. “We’re talking about a deal with $1,200 per person, we’re talking about other things.”
Speaking in Kentucky, Senate majority leader Mitch McConnell said that the two sides should continue to try to negotiate a deal, but said there are “vast differences about how much we should spend”.
The Democratic plan calls for $2.2-trillion in spending, while Mnuchin has offered $1.6-trillion. The administration offer, however, is higher than what many Senate Republicans have said they could support.
Even if there was a breakthrough in Pelosi’s talks with Mnuchin, negotiations among House Democrats and the Senate calendar make it unlikely that a stand-alone bill to help airlines — which are already haemorrhaging tens of thousands of jobs — will reach the president’s desk before the end of October.
While a measure could pass quickly if no lawmaker in either chamber objects, that’s unlikely to happen. Two Republican senators, Pat Toomey and Mike Lee, said in a statement Thursday that they oppose a bailout for the airline industry without some protections for taxpayers and the ability to make changes to the legislation.
And some House Democrats remain opposed to the idea of singling out the airline industry for such action — opposition Pelosi previously shared. There would almost certainly have to be some explaining by the speaker to avoid objections, the person said.
The administration’s focus on airlines underscored concern about the state of the industry, which has been walloped by the Covid-19 crisis and seen tens of thousands of job cuts. Carriers have furloughed about 38,000 people since October 1, including major layoffs at American Airlines and United Airlines.
A government report on Thursday showcased the continuing impact of the coronavirus crisis on the job market, with 840,000 initial claims for unemployment insurance in the most recent week in regular state programmes. That’s more than quadruple the level before the pandemic hit, and higher than the peak of the 2007/2009 recession.
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