Bailouts might not be popular, but there is no Plan B for a pandemic

DOW

Automatic TRANSCRIPT

Stocks have come crashing down because of the corona virus the Dow is now thirty five percent lower than its record high last month it's no wonder companies all over the country are saying they need a bailout Congress is preparing to spend hundreds of billions of dollars to help them but not everyone thinks that's a good idea as NPR's Jim zarroli reports just in a matter of days the bottom fell out of the U. S. airline industry here's Nicholas Calio of the trade group airlines for America on CNBC today I've never seen anything like it no one has the speed and degradation of the business has been just mind boggling and it's not just airlines under siege cruise ships restaurants even native American casinos have seen their revenue fall off a cliff and they're lining up for help president trump says these companies aren't to blame for what's happened and he's made clear he's ready to assist them we're also looking to help companies such as the airline industry within the airline industry and we'll be doing that for Republicans who bitterly opposed the Obama administration's auto bailout the idea of extending federal largesse to companies hurt by this epidemic is hard to swallow here's Nebraska senator Ben Sasse this week if you're an industry with a good lobbying team you're told the line up to the door of the treasury department and get the line because bailout after bailout is probably in the offing and former U. N. ambassador Nikki Haley dislikes the idea of an airline bailouts so much that she resigned from Boeing's board yesterday opposition notwithstanding Congress is plowing ahead with the rescue bill Republicans in the Senate have proposed a one hundred and fifty billion dollar plan for distressed companies there would be a separate pot of money for airlines and air cargo companies says Senate Majority Leader Mitch McConnell we're not talking about a taxpayer funded solutions for companies that made mistakes we're talking about loans for their part Democrats want conditions attached to any rescue money like promises not to cut jobs and they want more of it to go to fund unemployment insurance for the hundreds of thousands of people getting laid off however the money is distributed the rescue poses big problems says Jeff Myron director of economic studies at the Cato Institute this is just gonna end up being a big transfer to those industries that are politically well connected and can paint a case that makes it look as though they were especially hard hit by the by the epidemic Myron says once Congress starts handing out money where does it stop why not rescue universities or even sports teams they've been hurt by the virus to Dennis Kelleher is president of the Wall Street reform group better markets he says a lot of companies have been badly managed in recent years and may not deserve to be saved they borrowed too heavily for example and often the money went not to their employees but to fund share buybacks that just made their stockholders wealthier taxpayers should only have to provide aid to companies that are vital to the United States and only companies that otherwise act in a responsible manner Kelleher points out that the big Wall Street bailout of two thousand eight proved to be especially on popular with the public with lasting political a fax and he says the onus is on Congress to do a better job this

Coming up next