kettle1

I agree.

cbn42

The Deregulation act prevents states from regulating airline pricing, not the federal government. This bill would certainly be constitutional under the commerce clause.

Part of the issue is that the TSA has to scan bags, and carry-on bags have more stringent rules (and presumably cost more to screen) than checked bags. If people start carrying on more bags due to the checked baggage fees, it costs the government more money.

lhgreengrd1

Thank you so much for enlightening me with this earth-shattering revelation.

kettle1

I am not a lawyer, but I watched a lot of Perry Mason as a kid. I think all travelers pay for the TSA with fees added to the cost of the ticket. Last I read, the TSA makes a profit.

lhgreengrd1

Actually, it does, if either or both of the following scenarios are at play:

- A substantial portion of the product being sold is actually a pass-through of government-provided sub-services (such as airport runway slot fees, air traffic control services, TSA fees, etc.)

- A vendor has, through acquisition or predatory pricing, or by buying all of a locally available scarce resource such as landing slots - created a monopoly position for itself, or an oligopoly with apparent collusion between the players in a market.

One should not be naive and assume that the airline industry pricing is shaped by the conventional forces of supply and demand in the same manner that they would be in a competitive marketplace. Starbucks competes in a competitive market - Airlines, unfortunately in most instances do not.

kettle1

WRONG!

cbn42

Yes, travelers pay a TSA security fee, but it is a flat amount and does not depend on the number of bags checked in or carried onto the plane. Therefore, airline fees that encourage people to carry on more bags rather than checking them in cost the government money. One way to address this would be to make the screening fee depend on the amount of luggage, reflecting the higher cost of screening carry ons.

Care to explain how it's wrong?

kettle1

Here are a few examples.

http://www.nbcnews.com/business/trav...eficit-n155826

http://www.marketwatch.com/story/new...row-2014-06-30

http://www.cnn.com/2014/07/21/travel...nger-fee-hike/

Use GOOGLE, you will find 100+ more stories. LOOK IT UP!

dvs7310

Maybe the two of you are young enough to forget that this is the way it always used to be, 2 bags were free and there were no fuel surcharges (I say this tongue in cheek as I can see your account age, but its funny how quickly people forget). You didn't have problems with overstuffed overhead bins because people could check-in if they preferred. Then some numbskull (think it was Delta) got a hairbrained idea to try charging extra and it caught on.

Airline CEO's have always tried to sell "debundling" as a way for consumers to save money, but I know when I fly domestic in the US I pay FAR more now than I did prior to "debundling". I have no sympathy for the big 3 (or 4) remaining legacy carriers in the US after what they've done to consumers in the past 10-15 years. In most of the rest of the world, bags are free (or inclusive, however you want to look at it). Somehow airlines in Brazil and the Philippines are surviving with no fuel surcharges, somehow Cathay Pacific didn't collapse either when HK restricted Fuel Surcharges, they just price a fare at what they should be charging... oh, I don't see Philippine Airlines, Cathay, or TAM charging for checked bags either. Airlines in the US got greedy during the consolidation years and went way to far with it since they are not taxed the same way on these fees as they would be on ticket sales. If it takes federal regulation to get back to transparent pricing and "fair fares" so be it, regulate the hell out of them if that's what it takes, enough of the shenanigans from US carriers. The worst part is, what these big 3 do doesn't just affect American consumers, these companies being the largest in the industry also are very influential in other countries and have seen the same crap creeping into other markets after it proves to work in the US, so enough is enough.

Hoch

Is Congress so bored that it thinks it should take this up? I appreciate that to the leisure traveller that these fees are a bit of shock to the system. But given what a massive revenue stream this has become airlines will merely come up something else to replace this lost revenue.

H

RustyC

The problem is that self-regulation isn't working. Spirit, for example, is among the worst with bag fees, and it won't follow industry standards (so a bag is considered "overweight" for even more fees at 40 lbs. rather than 50 lbs.) They also frequently have "embargo" flights, especially international, where they won't accept more than 1 bag, period.

I have no doubt that Spirit would try to recover the money somewhere else if fees were capped, but OTOH their business model seems to be wanting to advertise as low a fare as possible in the big type but add on a pile of fees so that what someone might realistically pay is nothing like what was advertised. Bait and switch.

Here's a reason to support capping fees that you rarely see talked about: Because the fees have destroyed a huge amount of downstream economic activity. This is one of those "Freakanomics" arguments, but if you think it through it makes sense. People often make a lot of discretionary purchases (if not frivolous) in connection with vacation. Maybe a mouse-ears clock from Disney World is a questionable purchase to most people, or maybe it's something like a woodworking at an art fair, or whatever. Bag fees and the realization you may run into that or would have to go to a second bag or hit an overweight fee can be a powerful disincentive, and I'll bet they've had a real negative effect on how much stuff people buy while on trips.

Again, while much of the stuff is discretionary, it's economic activity nonetheless, and the biggest thing holding the economy back is not enough consumer spending at the middle and bottom vs. past recoveries or booms. By looking out so much for numero uno (except with Southwest), I'd argue that airlines have had a very significant negative domino effect on the economy with these bag fees, and that the effect has been underreported.

Obviously we need hard numbers or some way to try to quantify, but my guess is they've destroyed many times as many dollars in GDP as they've made for themselves with the fees.

For something analogous, imagine if the USPS did away with book rate and media mail. Those are chronic money losers, sfter all, and stem from decades-long mandates. OK, you've saved the postal service millions. But you've also hurt or destroyed economic activity still worth tens of billions, including every magazine publisher, book publishers, Amazon, etc. I'd argue that's the kind of thing airlines have done as an unintended consequence of the bag fees.

pitz

Outlawing excessive bag fees is basically a safety issue. Unfortunately, the airlines, despite their crackdowns, haven't been able to get people to stop bringing the rollaboards which test the limits aboard. Resulting in a cabin that is a giant mess, with bags stowed in places not really designed for baggage stowage, such as underneath the seat infront. The problem of the rollaboards is particularly acute amongst the frequent business travelling customers who covet them for the convenience.

If an airline truly has a subset of customers who travel roundtrip same-day and neither bring checked luggage, nor the stretching-the-limits carry-ons, then they should be using their loyalty programs to reward those customers instead of through the implied discount of not paying bag fees. Perhaps a special endorsement on same-day roundtrip tickets that gives double FF points or a free drink if only a minimal or no carry-on is brought aboard?

cbn42

That's a fair argument, but why should the airlines promote economic growth in other sectors at their own expense? USPS is a government entity, so they have some responsibility for the nation's economy, but the airlines are private businesses.

Your links show that the TSA operates at a surplus. I'm not sure how that is relevant to any of this.

Hoch

Yes, I can see the disincentive argument. Equally though if someone wants to fly they will and either pay the additional cost involved or HBO, which is of course making space even more scarce.

H

EricH

Yes, but there's more than stupidity here. This has the added advantage of being a shakedown of the airline industry. From Congress' view, it's win-win!