The Math On Another Round Of Airline Payroll Bailouts Is Insane. Has Nobody Done The Math? - View from the Wing

CNBC's Leslie Josephs summarizes what's at stake in airline lobbying for a second round of payroll bailouts,

U.S. airlines have warned more than 75,000 employees that their jobs are at risk on Oct. 1 when the terms expire on a $25 billion federal aid package that protects passenger carrier workers' paychecks, about a month before Election Day on Nov. 3.

...A push by airline labor unions and later, company executives, to include another $25 billion for airline payrolls to keep jobs through the end of March has won bipartisan support from lawmakers and from President Donald Trump.

Airlines have already gotten employees to agree to leave 'voluntarily' within the terms of the CARES Act. American Airlines, for example, took a scalpel to 30% of management employees - reducing payroll by about $500 million per year. Southwest Airlines says the voluntary early retirements and leaves its unionized employees have taken mean that it doesn't have to furlough anyone this year.

However once October 1 rolls around and airlines are permitted to let go of employees, because restrictions from the last payroll bailout have lifted, job losses will happen because there's less consumer demand for air travel and airlines need fewer employees to operate flights. That's a condition the airlines say is likely to last until 2024.

Airlines and their unions have asked for a 'clean extension' of the payroll support money, another $25 billion. However if that's to save 75,000 jobs through March 31, 2021 that amounts to $333,333 per job and come April 1 we'll see job losses again (when it's not election season).

I've called this the most expensive unemployment program in history because,

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1. It's unemployment, not a jobs program it ensures people continue to get paid their salaries when their companies no longer need them to work.
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2. Forget $600 a week, the price tag is insane. $600 a week for 75,000 workers would be 'only' $1.17 billion. The airlines want $25 billion. The covers, as American Airlines has said, around three quarters of 2019 payroll. But no airline is laying off that many people. The funding is for full pay not just for people who would be laid off, but for at least as many people who wouldn't. In other words, it's a subsidy to airline equity and debtholders.

I love the travel industry, and I love the people I know who work for airlines. Many of them in management are already gone. The ones that are left face a disruption in their lives and that is sad. But the best thing for many of them is to move to the next chapter in their lives. That's better for the economy, and policy should focus on helping with that - not giving them makework job that delays transitioning people productive roles, delays economic recovery.

Paying full 2019 payroll costs that's more than airlines would lay off, and where the numbers are based on payrolls much larger than they are today - Southwest and Delta each have already reduced current payroll by 17,000 - makes no sense at all.

Indeed there's no universe in which is makes sense to spend $333,333 per job to delay furloughs for just six months. That can't even make sense in a presidential election year, when the President doesn't want to see job losses and where the Democrats want to deliver pork to unions.