Things in the Sky calls it an interesting argument, but really that’s way too generous.
Congressman James Oberstar thinks checked bag fees justify the government re-regulating the airlines.
Deregulation has been credited with making airline travel affordable for the average American. But Oberstar pointed to the $2.7 billion the airlines earned in baggage fees in 2009 as evidence that consumers are no longer benefiting from the system. He said he believes there’s support in the House for re-regulation.
But consumer pricing is still consistently on the decline as a result of deregulation. (People forget that the whole point of the regulated era was to maintain high fares to boost airline profitability, that it wasn’t until 1976 that the Civil Aeronautics Board began ‘experimenting’ with allowing regulated airlines to offer discount pricing.)
And as Dan points out the bag fees amount to less than $4 per passenger. The TSA costs far more than that, yet somehow government bureaucracies are a good idea here.
Meanwhile, there’s a bill in Congress that’s passed the House to increase ticket taxes. How does Oberstar, chairman of the House Transportation and Infrastructure Committee, square his support for taxing consumers more for their tickets with his rants about roughly the same per-passenger cost for baggage?
Except of course that (1) more dedicated revenue increases the resources under the direction of the transportation bureaucracy, (2) baggage fees aren’t subject to tax, and (3) the latter doesn’t provide an opportunity for grandstanding.
Mike’s Deli across from my office imposes additional fees on top of the lunch special (sandwich + chips + small soda) if you don’t want Lay’s brand. And Ted’s Montana Grill will charge you an extra $2 to turn your side of fries into Chili Cheese fries. Small potatoes perhaps. But take P.F. Chang’s, according to Wikipedia the “P.F.” stands for founder Paul Fleming, who isn’t even Chinese (how about some transparency?) and they have over 200 restaurants. Their market cap is over a billion dollars. They charge extra for fried rice (though not for brown rice).
If it would get votes or TV time, or shake loose lobbying cash, no doubt it would be time to regulate Chinese menu pricing.