One issue I have with this proposal is that it gives a clearly assignable value to the miles. I fear that this will finally prod the IRS to stop looking the other way and start taxing them.
Also, I suggest really looking at the math. This values your miles at a pretty low rate. Consider a hypothetical pax (and disregard any elite bonuses):
- They fly frequently between JFK and LAX, in coach
- They can avail themselves of APEX fares, so each ticket costs an average of $400
Now, suppose that our pax wants to get a J ticket to Europe (90k miles).
- Under the current system, this would take approximately 19 return flights.
- Under your system, those same 19 flights would net our pax $760.
Of course, if you frequently fly BOS-LGA on last minute fares, then your proposal may make more sense, but for me, no thanks. Perhaps if you received more back, but I don't see anybody offering 20% anytime soon.