President Donald Trump in a series of tweets Tuesday rejected the possibility of a Covid-19 relief package and instructed his administration to stop negotiating an aid deal until after Election Day, seemingly denying U.S. airlines, hotels and other travel suppliers any prospect of direct federal funding for at least another month and raising the possibility of tens of thousands of industry furloughs and other job losses.
Trump in the series of tweets said that there would be no further negotiation until after the Nov. 3 presidential election, when “immediately after I win, we will pass a major Stimulus Bill that focuses on hardworking Americans and Small Business.”
However, late Tuesday night, Trump tweeted that the House and Senate should immediately pass a $25 billion package for airline payroll support and $135 million for the federal 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.
Congress had not reached full agreement on a new aid package following the March passage of the Coronavirus Aid, Relief, and Economic Security Act, which included billions of dollars of direct aid and loans to travel suppliers, including airlines, hotels, car and ground transportation providers, and travel management companies. However, negotiations including Trump administration officials and congressional leaders were continuing.
The House in May approved the $3 trillion Health and Economic Recovery Omnibus Emergency Solutions Act—or Heroes Act—but the Senate declined to vote on the proposal, with Majority Leader Mitch McConnell (R-Ky.) instead introducing in July the $1 trillion Health, Economic Assistance, Liability Protection and Schools Act—or Heals Act—on which the full Senate has not yet voted.
Under the provisions of the Cares Act, travel suppliers that received federal aid were prohibited from furloughing employees until Sept. 30, 2020. American Airlines and United Airlines since have begun to furlough some workers, but some suppliers were holding off full furloughs in the hopes of a deal between congressional Democrats and Republicans and Trump. Should Trump maintain his stance that he will not consider legislation before the election, it would mean that, with no chance at additional immediate federal aid, those suppliers could fully implement those layoffs, which could number in the tens of thousands.
The U.S. stock market declined sharply immediately after Trump’s initial tweets. Industry organizations sharply criticized the lack of a deal, before Trump’s late-night tweet pushing for airline relief.
U.S. Travel Association president and CEO Roger Dow in a statement said he was “disheartened in the extreme that Congress and the administration failed to reach agreement on the relief this industry so desperately needed, despite clear evidence of mounting harm.”
Citing Tourism Economics data that indicates the industry could lose up to half its jobs by December in the absence of additional federal aid, Dow in the statement said, “The reality is that small businesses in every pocket of America are shuttering—they needed relief months ago, which has been made clear week after week. With millions of Americans suffering, it is woefully shortsighted to end relief negotiations.”
American Hotel & Lodging Association president and CEO Chip Rogers called the end of negotiations “unacceptable and unconceivable with millions of Americans out of work and thousands of small businesses barely hanging on,” in a statement.
“America’s hotel industry is on the brink of collapse,” Rogers continued. “We can’t afford to let thousands of small businesses die and all of the jobs associated with them be lost for many years.”
The Global Business Travel Association in a late Tuesday statement indicated “deep concern” over the apparent breakdown in talks.
“With hundreds of thousands of jobs hanging in the balance, the business travel sector and the American economy need help now, not a month from now,” GBTA interim executive director Dave Hilfman said in the statement. “Our association and its members urge the administration and congressional leaders not to wait on a relief package, because without additional financial support from the U.S government, companies nationwide will be at serious risk of a meltdown.”
[Editor’s note, Oct. 6: This report and its headline have been updated to reflect additional information.]