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A Race to the Bottom for Airlines

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Considering how much I travel abroad and domestically constantly, I'm actually surprised how much I hate and resent the thought of flying. It’s not the fear of heights, or the turbulence, or even the perpetual fear of a terrorist attack. No, the blame lies squarely on the shoulders of airline carriers. Also, the utter agony and different standards for every airport of what can and can't pass through security screening is baffling.

Think about it. Every major industry today is progressing. Auto manufacturers are building cars with better fuel economies, more room, more horsepower and with fewer emissions. The same holds true for consumer electronics, power companies, phone carriers, freight rail, and trucking. Even the Postal Service seems to be trending in the right direction. Except the airlines.

If you don’t believe me, just ask yourself when was the last time you boarded a flight that wasn’t full to the gills? When did you actually have room in the overhead compartment to store your belongings? When do you last recall getting a meal or a cup of coffee without having to hand the flight attendant a major credit card? The seats are smaller, more uncomfortable, certainly more dirty than they have ever been. Smell that foul stench coming from the back of the plane? It’ll pass. Want a blanket? That’s $5 please. Want to watch TV? Another $5 please. What’s next, a coin-operated toilet??

For example, I honestly cannot name one colleague of mine who, when forced to travel to New York, doesn’t opt for the AMTRAK train over a flight into LaGuardia. In fact I've flown to NY only twice from DC since 9/11 and the Acela train is my only mode of transportation to and from the Big Apple. The Acela is truly a rare gift from Heaven and Earth when you think hard and along about future travel plans.

To add insult to injury, major air carriers either don’t seem to notice the plight of travelers or don’t seem to care. What they care most about is fleecing your wallet for the cost of your airline ticket.

There was a time when, if a plane were parked on the tarmac for hours at a time, the local news would show, interview passengers coming off complaining, and the airlines would be forced to run commercials pledging new commitments such as a passenger bill of rights. Today, they don’t even get so much as a meal voucher.

When oil spiked at over $155 per barrel years ago, airlines were first in line to complain they were going under if they couldn’t hike fares. They added surcharges for baggage to help defray the costs of the additional fuel. Today, oil is hovering around half the price of its all-time highs. Are the baggage fees gone? Heck no. In fact, they’re now charging more!

Recently AOL's travel section had this to say about the airlines and their hidden fees and charges. "If you have flown any time over the last few years, it should come as no shock that most airlines are now charging for checked baggage, extra legroom, early boarding, and even in-flight food. But what you may not know is airlines are now considering flying during the holidays a privilege, and have instituted a surcharge for traveling on peak days. This "premium" fee of $10-$30 is added to the cost of your ticket if you fly throughout much of December and the beginning of January. Be wary of deceptively cheap fares, as these tickets are often driven up by add-on fees for holiday air travel."

At a time when most sectors are offering consumers their own “stimulus” packages to incentivize sales, the airlines have gone the other way. They ground planes and take them out of commission, limiting seats, artificially decreasing supply and driving prices up. Flights are routinely (and intentionally) overbooked, with flyers now receiving empty apologies followed by emotionless comments of “There’s nothing I can really do.”

Signs now warn “Doors close promptly 10 minutes before take-off” so carriers can cancel seat assignments for confirmed passengers and offer to standby passengers. At the same time, flight delays are at near-record highs, with average lapses inching toward hours, not minutes.

I recently took a cross-country flight. I was tired, hungry and bored. When I tried to find some solace in even a movie (a staple of major carriers on flights longer than say, 2.5 hours), it was as if I’d asked the flight attendant to do a cartwheel down the middle of the aisle. Her reply was the same, “We stopped doing that.” No explanation. No apology. Just a “deal with it” look on her face that made me feel as if I had asked for a lap dance.

I won’t name the airline because it doesn’t matter. They all seem to be the same. Come to think of it, have you noticed that all the airlines seem to have adopted their own “race to the bottom”? When one executive was recently asked why they no longer serve creature comforts such as a cookie or a second pass of the beverage cart, his response was, “Because no one else is.” That, my friends, is the sign of collusion, pure and simple. How can an industry purport to serve its customers when it’s constantly looking for a way to stiff them? Are their margins so short they can’t offer more than one bag of pretzels? I don’t believe that, because if it were true, they wouldn’t be in the airline business. Those executives would be in the pretzel business where pennies on the dollar signal boon times.

Part of me can’t help but to blame regulators for this mess. There are so many obstacles to entry in the domestic carrier industry. And when one airline seems to get a foothold, they’re quickly squashed by the competition, either due to pre-determined hubs and flights or because the sector is both cash and capital intensive. What results is the opposite – major mergers of airlines that threaten to consolidate power (and oligopolistic behavior) even further. Or worse, bankruptcies that let carriers restructure and return, with even less incentive to cater to customers.

Maybe I’m just complaining. I haven’t really offered statistics or any economic models to support my claims. But do I really need to? I still take flights that make a refugee camp look like Club Med in terms of seating. I still have to pay resort-style prices for quickie-mart quality food. And I still feel like I’m taken to the cleaners every time I purchase a ticket to a destination that requires me to actually carry a change of clothes.

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