In a bipartisan vote yesterday, the U.S. House of Representatives passed the Transparent Airfares Act of 2014 which would roll back 2012 legislation requiring that the full fare be displayed at all steps of the airline ticket booking processing. We’ve had this discussion before, so there is no need for me to go too much into why I strongly oppose the Transparent Airfares Act of 2014.
Pennsylvania Republican Congressman Bill Shuster is the chief sponsor of the Act and reasons the bill is necessary because–
Virtually all consumer products are advertised at a base price, with taxes added on at the point of purchase. But Department of Transportation regulations have fundamentally and unfairly changed the advertising rules for airfares by requiring all government imposed taxes and fees to be embedded in the advertised price of a ticket. As a result, the fact that Americans are paying higher and higher government imposed taxes and fees to travel by air is being hidden from them. This common sense bill will allow consumers to see the full breakdown of their ticket costs, so they know how much they’re paying for the service, and how much they’re paying in government imposed taxes and fees.
Only it is not that simple. First, I strongly believe that certain government taxes and fees are too high – we just saw an increase in the TSA’s “September 11th Security Fee” last week – the rate has more than doubled to $5.60 per direction of travel (previously it was $2.50 for each segment, capped at $5.00 each way). But let us not forget that taxes/fees cover what must reasonably be considered part of the airfare – airport infrastructure and yes, even security. This is indisputably part of the cost of airfare, for security screening, airport concourses, runways, and control towers are all necessary components of commercial air travel.
The Congressman’s statement is devoid of logic – current regulation does not prohibit a breakdown in price of airfare, it merely prevents the bait-and-switch games we routinely saw prior to 2012, where airlines would advertise “$300” transatlantic airfare only to actually charge triple that once all taxes/fees were added in. Carriers can still breakdown the taxes as long as the full price is displayed. As I pointed out with my recent hotel search in Las Vegas, not displaying the full price is nothing more than false advertising meant to lure customers into a deal that is too good to be true. While true that in the USA taxes are typically added on at the point of sale, a sales tax is far different than taxes that undergird the air system that is directly necessary to make air travel possible.
And just who is Rep. Shuster serving? Fly2Travel points out that his loyalty may be more to the airline industry than the people he was elected to serve. Take a look at his top campaign contributions for this year–
|Airlines for America||$16,700||$6,700||$10,000|
|Delta Air Lines||$13,500||$10,500||$3,000|
|American Trucking Assns||$12,500||$2,500||$10,000|
|United Continental Holdings||$12,000||$2,000||$10,000|
It should be noted that the blame does not just fall exclusively on the Republicans, as this bill has garnered widespread bipartisan support in the House.
Shoppers are smart enough to figure out the price of an airline ticket without federal regulation, said Oregon Democrat Peter DeFazio, a bill co-sponsor.
“Talk about the nanny state,” he said. “Give me a break. What do they think, Americans are idiots?”
I think you are an idiot, Congressman, to complain about “nanny statism” when it comes to misleading airfare pricing.
Passage of the bill in the House is not the final step. The Senate must pass an identical bill and it must be signed by the President, two distinct unlikelihoods.
In fact, the Senate seems to thankfully be moving in an opposite direction, Senate Transportation Committee Chairman Bob Menendez (D-NJ) introducing a competing bill called the Real Transparency in Airfares Act which would ddouble maximum penalties (to $55,000 per day) for airlines and ticket sellers like Orbitz and Expedia that do not post the full fare.
So it sounds like stalemate ahead, which is certainly better than rolling back consumer protections that protect consumers from bait-and-switch airline advertising scams.