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Obama administration pushes for airline regulation

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(eTN) – In 1978, the United States government deregulated the airline industry, and by all appearances, everything was running along fairly smoothly until in recent years, fuel prices took a staggerin

(eTN) – In 1978, the United States government deregulated the airline industry, and by all appearances, everything was running along fairly smoothly until in recent years, fuel prices took a staggering upward turn because of the oil market. Yet, even with airlines increasing their airfares to offset the increasing cost of fuel, Americans accepted the higher costs, because its citizens understood the direct correlation between the higher cost of fuel and the increased cost of airfare. They were, after all, faced with the same dilemma every time they had to fill the gas tanks of their personal vehicles.

But then the “Great Recession” came along, and Americans started to cut back on their leisure travel. American businesses cut back on trips as well, opting instead for virtual meetings or traveling in economy instead of business and first class. Airlines, desperate to make up for lost revenue, began to look for other ways to make a buck and started charging fees for everything from extra baggage to blankets.

Coupling these fees with what was already categorized by American travelers as bad service from the airlines due to such problems as being stranded in an aircraft on the tarmac for hours on end, created dissatisfaction that went from the irritating to the ridiculous. Reaching the “that’s all I can stand” stage, Americans began to voice their complaints to government, and the government listened with a sympathetic ear.

Under the lead of President Obama’s administration and US Congress, airlines are now facing the biggest changes in the airlines industry since deregulation in the form of new union and government rules – regulatory changes across the board – and the airlines are crying foul. US Airways CEO Doug Parker has been quoted as saying, “The biggest threat to our viability is government intervention.” Doug Lavin, regional vice president for North America of the International Air Transport Association has said, “They [government] are intruding into the private sector.”

Government’s plans will address a number of airline industry concerns, with airline fares and fees in the forefront – how airlines advertise their fares and how fees are disclosed – along with how airline passengers are compensated for lost baggage. Airline consumer advocate groups, such as the Business Travel Coalition (BTC), think it is high time the government holds the airlines accountable for disclosing fees. Kevin Mitchell, head of BTC, which cosponsors the MadAsHellAboutHiddenFees.com web site, said “There’s zero chance that the airlines are going to voluntarily provide that information.”

With one airline charging for a pillow, and another charging US$25 for the first extra bag, while a competitor charges $US30, but only for a bag that weighs up to 30 pounds, unless you have a 2nd extra bag, in which case the fee will change to… well, you get the picture. The airlines and the fees they charge are about as clear as mud. To an airline passenger trying to figure out what each airline charges for and what is and is not included in the cost of airfare is downright confusing.

If the federal government were to impose a standardized format as to how airlines disclose their fees, it would at least make comparison shopping simpler and easier to understand. And in this day and age when “transparency” has become the new buzz word, why would the airline industry choose to believe that they are somehow an exception?