COVID-19: will optics and politics derail aid for US airlines?

At the time that US legislators passed the USD2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act, airlines and labour unions alike hailed the legislation as a breakthrough for the portion of the bill that pledged approximately USD25 billion in payroll grants to the airline industry for sustaining worker pay and benefits until the end of Sep-2020.

But a last minute provision in the bill attached major strings to those payroll grants - allowing the government to take an ownership stake in airlines that sought both the payroll grants and loans included in the financial relief package.

Unions are decrying the move, and the nation's airlines are now attempting to negotiate with the US Department of Treasury on the terms of the grants as collectively they continue to burn through nearly billions of dollars in cash each day. Labour is warning that the longer Treasury drags its feet, the higher the risk of painful bankruptcies will continue to grow significantly.