Friday, February 03, 2012

Smackdown: Spirit Air vs. Dept of Transportation

IBTraveler -- Spirit Airlines announced this week that it would add a $2 "unintended consequences fee" to all tickets due to new federal regulation aimed at protecting consumers. The "Department of Transportation Unintended Consequences Fee" was added to each ticket effective immediately and is a direct response to new DOT rules put in place Jan. 26 to offer travelers better "passenger protections."

The most visible of the new rules was a law that required airlines to include mandatory government taxes and fees in all advertised fares. Other rules pertained to ticket cancellation policies and baggage fees. Spirit says it's the DOT regulation allowing passengers to change flights within 24 hours of booking without paying a penalty that's forced them to add the fee. The low-cost airline says the new regulation forces them to hold the seat for someone who may or may not want to fly while not allowing someone who really does want to fly to book that seat.

However, the nation's transportation chief disagrees. "This is just another example of the disrespect with which too many airlines treat their passengers," Department of Transportation Secretary Ray LaHood said in a statement. "Rather than coming up with new and unnecessary fees to charge their customers, airlines should focus on providing fair and transparent service - that's what our common sense rules are designed to ensure."

HT: W.E. Heasley

21 Comments:

At 2/03/2012 9:16 AM, Blogger juandos said...

Forbes July of '11: Five Things You Need To Know About the Current Airline Ticket Tax Controversy

Got to pay for this somehow apparently: Controversial FAA program serves just 153 communities at a cost of $200 million

September 15, 2011

Created in 1978 as a part of the Airline Deregulation Act , the Essential Air Service subsidy was designed as a 10-year initiative to help rural airports likely to be left without routes as commercial aviation converted to a market-driven system. In most cases, the program limits assistance to isolated communities more than a 70-mile drive from the nearest major hub airport, which could be subsidized at a rate of less than $200 per passenger.

But EAS has persisted almost 25 years past its original congressionally mandated expiration date. It now serves 153 communities and costs some $200 million a year...

 
At 2/03/2012 9:48 AM, Blogger bob wright said...

The press release should have been:

"This is just another example of the disrespect with which too many government bureaucracies treat American businesses," Spirit Airlines said in a statement.

 
At 2/03/2012 10:00 AM, Blogger Gene Hayward said...

The quote from LaHood (I always think about the Clint Eastwood movie "Unforgiven" when I say his name)seems tailor-made for a Dr Perry mark-through-edit...Why does the Fed govt not require gas stations to publish the Federal Gas tax included in the price of gas? How about requiring retailers to put on the price tag how much in tariffs and other taxes are embedded in the price of a good (and note that you pay sales tax on the tariff/Fed taxes as well)? I think taxpayers SHOULD know what they pay for a good before all taxes/fees are factored in. Full disclosure, indeed.

 
At 2/03/2012 10:06 AM, Blogger morganovich said...

""Rather than coming up with new and unnecessary fees to charge their customers, airlines should focus on providing fair and transparent service - that's what our common sense rules are designed to ensure."

how about "rather than being a bureaucratic numbnuts without the slightest inkling of how economics or business works, you should go get someone to explain opportunity cost to you."

if you up the risk of airlines getting stuck with unsold inventory that becomes valueless as soon as the plane takes off, they have to raise price to account for it or they lose profits.

hotels do the same thing. even some restaurants require a credit card to hold a reservation.

but no, you, DoT super genius that you are can suspend the laws of economics and make the world different then ride off into the sunset on your unicorn.

seriously, who lets these fools regulate anything.

 
At 2/03/2012 11:29 AM, Blogger Benjamin said...

Homeland Security, VA and the Department of Defense---time to sunset?

I think so.

 
At 2/03/2012 2:05 PM, Blogger bob wright said...

Departments to close:

Commerce
Labor
Education
Energy
Agriculture
Health and Human Services
HUD

Send all of this money back to the states.

Then, re-asses.

Never close DOD and VA. These are the only legitimate functions of the federal government, besides maybe Treasury.

Just bring the troops home from Japan, South Korea, Afghanistan and Germany [the Europeans can pay their own defense and military costs]. We can put all these troops in new bases along the southern border.

 
At 2/03/2012 2:45 PM, Blogger Benjamin said...

Bob Wright-

If you read our Founding Fathers, you would learn that a standing military was never something they contemplated. The loathed the idea of a permanent military, especially an Army. Congress did not give President Washington a military in his first term in office, despite the fact we had just rid the British from our shores.

The Constitution is rife with pro-militia sentiments, meaning civilian, volunteer militias. The Congress is authorized to fund the military only for two years at a time, a specific limit that applies to no other federal activity.

The VA should obviously be privatized, probably by giving veterans vouchers. All federal pension, civilian or military need to be phased out. They are time bombs for taxpayers.

The idea of a permanent, mobilized military emerged in the Cold War. And that war is 30 years dead.

But federal agencies never die.

 
At 2/03/2012 4:43 PM, Blogger Ron H. said...

morganovich: "how about "rather than being a bureaucratic numbnuts without the slightest inkling of how economics or business works, you should go get someone to explain opportunity cost to you."

Well said! I'm going to save that, if you don't mind. It should be handy in the future when I'm struggling for just the right words. :)

 
At 2/03/2012 5:36 PM, Blogger jorod said...

Imagine if the government adopted common sense rules about taxation...

 
At 2/04/2012 11:25 AM, Blogger juandos said...

"If you read our Founding Fathers, you would learn that a standing military was never something they contemplated"...

Hey pseudo benny, you got anything credible to back up that statement?

Try this out: The Third Amendment and the Issue of the Maintenance of Standing Armies: A Legal History

by WILLIAM S. FIELDS and DAVID T. HARDY

You might find it interesting...

 
At 2/04/2012 11:48 AM, Blogger Emil Perhinschi said...

the Robert K. Merton tax :))

or the Habermas tax if you're leaning to the left

 
At 2/04/2012 9:56 PM, Blogger Hydra said...

The incidence of long waits on the tarmac decreased dramatically after government regulations were issued.

 
At 2/05/2012 12:08 AM, Blogger sethstorm said...

This comment has been removed by the author.

 
At 2/05/2012 12:14 AM, Blogger sethstorm said...

Then the government can respond in kind by removing the ability to do fees in the name of price clarity. Zero fees, zero chance to express arrogance.



"This is just another example of the disrespect with which too many government bureaucracies treat American businesses," Spirit Airlines said in a statement.

That would just further prove the case of business erroneously and arrogantly thinking they are above regular people and the government that represents regular people.

 
At 2/05/2012 6:21 AM, Blogger OBloodyHell said...

>>> then ride off into the sunset on your unicorn.

Y'know, if they were sitting on the horn when they do this, it might not be quite such a bad idea.

Short of them doing that, however, I don't approve of it.

 
At 2/05/2012 6:25 AM, Blogger OBloodyHell said...

>> Homeland Security, VA and the Department of Defense---time to sunset?

I think so.


Benny:

Head. Ass. Removal in order.

Stop thinking until you do something about this major life problem-obsession of yours.

 
At 2/05/2012 6:31 AM, Blogger OBloodyHell said...

>> If you read our Founding Fathers, you would learn that a standing military was never something they contemplated

No, he's essentially correct that they didn't like standing armies.

The difference is that this is now, that was then. There were two giant, very effective moats on both sides of the continent that discouraged meddling and warfare moderately effectively for the time.

More critically, there wasn't anything much here worth conquering or stealing.

In the last 100+ years, that has changed radically in both arenas.

So a standing army to defend our interests both here and abroad serves a useful purpose.

Thet it could be RUN better would be a legitimate thing for benny to approach everyone on... but Beddy being a twat and an imbecile unable to listen, learn, or otherwise function as a human being wearing long pants, whose multiple efforts at self-trepanation have been markedly successful, can't grasp things like this. He thinks there's any rational sense in eliminating ONE fo the FEW functions -- "to provide for the common defense" -- which the government exists explicitly for.

 
At 2/05/2012 11:52 AM, Blogger Mkelley said...

This country is being overrun by too many regulations. Just lately I spoke with a gal who did the books for a nursing home for many years and a guy whose wife has worked as a school clerk for decades. Both told the same story of a steady increase in paperwork demanded by state and federal governments. The sad thing is that the number of nursing home residents has been stagnant, and student numbers have dropped dramatically over time, due to smaller families and much more home schooling. I know of no improvement in nursing home care or student performance that can be attributed to the growing government requirements either.

 
At 2/05/2012 8:51 PM, Blogger Hydra said...

There are good regs and bad regs, and they change over time.

We need regulations that are right for the times. That is why I recommend we develop more regulation that are controlled by the market constituencies for and against them: market based regulations that regulate themselves.

 
At 2/05/2012 9:31 PM, Blogger Hydra said...

Big ad about how the NFL improved the game with more and new regulations.

 
At 2/06/2012 4:06 AM, Blogger Ron H. said...

"We need regulations that are right for the times. That is why I recommend we develop more regulation that are controlled by the market constituencies for and against them: market based regulations that regulate themselves."

What nonsense.

 

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