Part of President Obama’s recently announced deficit reduction plan includes a provision that will double security fees on tickets, increasing the price of a round-trip ticket by up to $20. While I agree that airport security should be styled as a consumption tax, it is important for us to question (again) why this tax increase is needed in the first place.
Currently, passengers pay a $2.50 per segment (capped at $5.00 one-way) “9/11 security fee” to help offset the operating costs of the massive behemoth we know as the Transportation Security Administration. Still, the security fee only covers about 1/3 of TSA operating expenses. The Obama administration argues those who use the air travel system should pay for it while the airlines argue that airline security is a national-defense function and their passengers pay an unfair share of the costs.
Who is right?
Neither is right. I do favor consumption-based taxes, but I think both sides of the argument miss the fundamental point: why do we need increased funding in the first place? More full body scanners that still have not proven to be effective? More screeners when there already seems to be a surplus of them milling about (like when I was at Dulles a few months ago and only one security lane out of ten was open at 0900, with a dozen agents standing around in a circle chatting)? Or a pay raise for American’s second-most hated government workforce (behind the good folks at the IRS)?
Believe me, I am not foaming tea at the mouth with chants to “cut, cut, cut” but I do want to see where this increased cash flow will go. Will it really replace current outlays that come from outside the security fee coffers or just bloat the DHS budget further? And we should not underestimate what some analysts are warning: increased fees on airline tickets increase the overall price, driving down demand. In the end, that may actually reduce the total amount of money DHS takes in through security fees and hurt the airlines in a time of anemic economic growth.
Watch closely as the Republicans and Democrats bicker in the coming weeks over competing deficit reduction plans. Sadly, I suspect it will be more of a shouting match for political gain than a thoughtful attempt at stimulating the economy while reducing the deficit (if that is even possible). The two sides should come together and question how increased funding for airport security provides one iota of greater security than a re-inforced cockpit door and a vigilant passenger provides. They will be hard-pressed to find an answer.