Re-regulate the airlines? “Trust me, before was better”

A movement to re-regulate the airline industry is slowly gaining momentum in Washington. A few days ago, my colleague Charlie Leocha send me an audio transcript of an interview with Rep. James Oberstar, chairman of the House Transportation and Infrastructure Committee, in which he raised the subject.

Now, my readers are sounding off about the idea. Readers like Marilyn Wright, a former travel agent who worked before, during and after the airlines were deregulated in 1978.

“Allow me one quick ‘I told you so’,” she says.

Not only did the traveler get pretty much (and more) what they paid for in airline travel, many small areas had airline service, because Uncle Sam said so!

Now, of course, there are fewer airlines and fewer cities in the US being served by them, if you want to call what they do service.

Sometimes, government regulation is the best way.

Do you like your phone “service”? Is that cheaper or better? Not cheaper, for sure. Just because you can do more stuff with your phone and have more companies to choose from doesn’t mean it’s better or cheaper to talk on.

I, personally, am so very glad that I took every opportunity to travel the world when I was a travel agent.

Now? Not happening. Absolutely not worth the hassle or the money. If I can’t get there by car, I’m not going!

Interesting thoughts.

I also remember air travel before 1978, and I think it was better. I shake my head whenever I see airline apologists — particularly the ones who are old enough to know better — say “before” was worse. They must not have flown very much.

Oberstar’s reasons for re-regulation have less to do with the quality of air travel and more to do with competition. In the interview, he notes that he and other members of Congress who supported the Airline Deregulation Act of 1978 didn’t think they were voting for less competition.

His comments came in the context of the latest mega-merger, that of United Airlines and Continental Airlines. As far as I can tell, the congressional hearings on the matter failed to reveal a single benefit of the merger to consumers. Oberstar says there’s Republican support for the idea of re-regulation and added that ideally, he’d also like to “unwind” the merger between Delta Air Lines and Northwest Airlines, too.

Now that would be something.

(Photo: Tom Purves/Flickr Creative Commons)

  • Michael

    Socialism, anyone?

  • larry

    Yeah it was better,,,,,if you were wealthy or on a business paid trip. The travel agents comment about seeing the world is telling…. when she was a travel agent.. Can you say discount or free? Now it’s is affordable for common folks and I hope that does not change. I remember when it cost $1,000.00 to fly from Atlanta to Miami. Spirit Air just had a promo last week for $1 each way plus taxes and fees and before someone bring up the charge for overhead bins which starts in August, this promo was for July.

  • http://coachclassblog.com Jeanne Leblanc

    No doubt — air travel was better before deregulation. If you could afford it. In those days, jets flew profitably at 60 percent capacity because fares were quite high. Deregulation lowered fares and opened air travel up to the middle class in this country, and as a member of the middle class, I have to be in favor of that. I do believe the federal government should enforce some basic levels of decency in air travel. But going back to the days of fully regulated routes and guaranteed airline profits would cut most Americans out of air travel.

  • anij

    Oh, I don’t know. I flew from MSP to Honolulu in 1978 (in January) for $350 round trip. It was great and I didn’t work in the travel industry. I did this as a college student. Now, I can’t fly to NY for the price.

  • ptkdude

    Wow! $340 RT from MSP to HNL in 1978. That’s not a bad price. In today’s dollars. In 1978 dollars, that’s more than $1100.

  • larry

    Anij. care to figure what that $350 cost would be in TODAY”S dollars?????????????

  • larry

    Anji, I’ll answer it for you.. $350 in 1978 calculated to today’s dollars.. $1,150.00 using consumer price index. $1,180.00 using Production Worker Compensation index.

  • SirWired

    I’ll take the current pricing over pre-deregulation service any day of the week. If an airline wants to offer the style of service that was available before deregulation, they are more than welcome to do so, even in the current market. Yes, some sane attempts to better enforce anti-trust law would be welcomed, but re-regulation would be a disaster for the flying public, which has shown no appetite whatsoever for the fares that would result.

    Several players have made attempts to do an all-business-class trans-Atlantic service, and all of those attempts have been complete failures. Yes, service sucks now, but consumers have clearly voted with their wallets and said that, to a point, a low ticket price and frequent flights are more valuable than better service.

  • Roberto

    As others have pointed out, flying was much more pleasant before deregulation. However, once you adjust prices for inflation, you’ll realize that the reason flying was so much nicer was because you were paying 5x what you’re paying now!

    Would you be willing to pay 5x your fare for a 1970s experience? Neither would I.

  • Maureen

    Prior to 1978, every airline charged the same price between two points on which there were competetive airlines. LA to SFO was $9.00 one way. The difference between the different airline at that times was THE LEVEL OF SERVICE! Western Airlines “Hunt Breakfast” for first class passengers cost $7.38 Western to prepare and serve. Flying first class was $24.00.

    All airlines made a 6% profit on service.

  • David

    Interestingly, $1150 is just about the price I found for the MSP-HNL route for our winter vacation. Except in 1978, I would have been fed and would not have had to pay for my checked baggage . . .

  • Arizona Road Warrior

    Before 1978, the fare for the same route was the same from all of the airlines flying that route. Service was great because that was the only way that the airlines could compete for your business since the price was the same. However, the fares were high and only the rich and business travelers flew because it was nearly impossible for the average middle class family to afford it.

    Fares today are lower than what they were 5, 10, 15 and 20 years ago. If the airline industry was re-regulated, the fares will go up and the prices for fares from the discounters (Southwest, AirTran, Spirit, etc.) will be the same price as the legacy airlines.

    It is my opinion that most people buy on price than service. Look at the great expansion of Wal-Mart, Home Depot and Lowe’s in the past 20 years. When I go into big-box stores, I don’t expect service. First, it is nearly impossible to find an associate\clerk\etc. to help you. If you are lucky to find someone, it is likely that they don’t know the answer to your question, the location of the merchandise, etc.

    “many small areas had airline service, because Uncle Sam said so!”
    The legacy airlines didn’t have the discounters cherry-picking their routes (the most popular routes). It is hard to be competitive with the discounters if you are flying to the small airports where they are losing money. No wonder all of the legacy airlines have filed bankruptcy.

    “Now, of course, there are fewer airlines and fewer cities in the US being served by them, if you want to call what they do service.”
    Of course…unlike the federal government that can print money, the airlines can’t print money. In the real world, businesses shut down offices, plants and locations as well as to eliminate products, services, brands, etc. if they are not making money. Why fly to a small airport where you can’t charge fares that will cover the costs for the flight?

    Once the federal government can balance their budget, Social Security, Medicare, Fannie Mae and Freddic Mac are back in the black; Amtrak and the Post office is breaking even or making a little profit; the $ 250 K a year lawyers at the SEC have stopped watching porn on the taxpayers’ dime and the new Health Care plan has been out for ten years and all of its objectives have been achieved then and only then should the federal government should look at re-regulating the airlines.

  • Mike

    @Michael If you ever really took the time to see what Socialism really is, I think you would stop posting such foolish comments. Please do yourself a favor and stop rehashing what you hear on talk radio.

    There are three groups as far as I can tell. One group says let business do its thing and stop with all the regulations. if we do that, then we all end up with lead poisoning, asbestos in our lungs, and horrible working conditions, substandard wages, and 10x the airplane crashes every year because there would be little oversight and they would cut corners every chance they got.

    Then there is the regulate everything group. they seem to want control on everything because they seem to think they know what is best for the consumer. They want to control costs, dictate what portions of populations get hired, and decide how much money a company should be allowed to make.

    Then there is the vast majority of people who happen to be silent. We realize that business needs some oversight for the protection of workers and consumers, but also understand that competition, mergers, and other parts of business will go on every day. The next Steve Jobs and Bill Gates will come along some day and they too will enjoy the american dream as so many aspire to achieve.

    Personally, I’m in the last category. I don’t think the airlines need re-regulation. What I do think is that they need to be told that the consumer comes first, by law if it takes that much. if the consumer pays for a ticket, make sure they get what they paid for, and in a timely manner. If not, then provide for a timely remedy or compensation. Let the airlines know that a diverted flight in Atlanta because of weather should not allow a delayed NY to Chicago flight to be deemed “an act of god”. The airlines want to cut things close to save a buck or make money, then they need to live with the results.

  • Monica

    I would love to re-regulation. Sure, it cost more, but I am willing to pay for good service. I miss the service I received back then. I traveled a lot as a child around the time the law changed. I remember flying between Denver and Chicago every summer and winter break from school. I never worried about my bags and I always got a meal/beverage during the flight. Not to mention I always got to pick my seats ahead of time, with no additional charge. Now it’s $5+ to get a crappy “lunch” box, $50 to check my bags, and $25 to get assigned seating prior to getting to the airport. Oh, and $5 to get a set of earphones for the flight. Those used to be free, too.

    Many people have mentioned that it was more costly before, but I never remember people complaining about the prices at the time. Today flights are dirt cheap and people are complaining more. Maybe cheap and a la carte isn’t the best after all…

  • Ed

    I remember flying back in the 60s and 70s. I was just a child, but I remember the wonder, the pomp and circumstance in actually flying in a plane.
    My dad worked for Pan Am which was the flag ship of America at the time. I remember clearly when they got their first 747 and was one of the group of people allowed to fly it’s maiden voyage and standing in the plane at Dulles Airport marveling at just how *BIG* this thing was!.
    Flying, back then, was an event. People dressed up and behaved civilly. Ticket agents were courteous and stewardesses (yes, that’s what they were called at the time) were all young, beautiful and pleasant (to *my* 9 year old eye at least). Pilots took you into the cockpit and showed you all the things that goes on in flying an airplane, and when you left, you had a coloring book, crayons (not those off brands), stickers and a pair of metal wings pinned to your jacket (yes, I did say people dressed up when they flew, even the children).
    The distance between seats were enough that children could play on the floor between their seat and the seat in front of them…even back in coach! Food was non-stop during your entire flight. And if you were flying first class on a 747, the upper deck was sometimes turned into a full dining room. Complete with the pomp and circumstance of a 5 star restaurant! Everybody on the plane got food, and even seconds if you wanted. As a child, I flew several times a year between the east coast and europe and never once considered bring on my own food. The plane had everything…graham crackers for the children, Smoked almonds for the adults (and the adventurous child). Passengers were well fed, relaxed and calm enjoying the wonders of modern aircraft flying. Children didn’t scream, or kick the seats in front of them (most couldn’t even reach the seat in front of them) and behaved, because the inside of the airplane was as comfortable as your living room sofa. Plus, back then, children *LISTENED* and *BEHAVED* when their parent told them to do so (or else!).
    It was a different time back then…certainly. The other day, while checking in for a flight, I happened to peruse the line of people waiting to get their tickets (why don’t more people use the kiosks?) and the rag-tag, motley crew of folks in that line looked more like a refugee camp than civilized people waiting to fly on an airplane! People in pajamas, people lying on the ground sleeping, angry folks glaring at their watches or yelling into their phones, ticket agents getting more and more frustrated, so that by the time the last few people in line get to them, they are so angry the would likely want to strap people onto the wing!
    The civility of flying is long gone, instead the anger and frustration have taken over as flying has become more of a commodity and is no longer the wonder it once used to be.
    Ed

  • Chuck

    I dunno about 1978. I flew all over the place in the mid to late 1990′s and have NO memories of bad flights during that time. Then 9/11 happened and that seems to have been more of an excuse then anything I can remember since I first flew (which was in 1978).

  • larry

    David, I flew to Reno from Atlanta in 1978 for $387. I remember because I was on my way there to get married. Today, I found the same route for $414. In todays dollars, that $387 would be north of $1,200. The point I’m making is you can find variations of this to make your point just as I can. But, the bottom line is that flying is much cheaper today than back then. ED,,,,,, Pan Am is bankrupt last time I checked. There is a reason for that.

  • Arizona Road Warrior

    My first flight was in 1984 on US Airways between IND and LGA. I still have the receipt for that ticket. The fare was $ 325. A few minutes ago, I did a quick fare search on Orbitz (departing on 7/19 and returning on 7/22) and the fares were:

    Delta: $ 185
    US: $ 186
    Air Tran: $ 192
    CO: $ 223
    UA: $ 223
    AA: $ 332
    Midwest: $ 333
    Frontier: $ 389

    By the way, I went to the Southwest website since Southwest does NOT allow its fares to be included in most if not all of these fare search engines, the cheapest fare was $ $445.80. Unless you spent $ 260 to check your luggages and for any other fees for ONE person, it is cheaper you to fly DL and US than Southwest.

    Since 1984, inflation was been 85% based upon the consumer price index (Source: http://www.inflationdata.com). The $ 325 fare should be $ 601.25 (325 x 1.85) today. It is my guess that the these $ 185 and $ 186 flights from Delta and US Airways are at least at 80% capacity if not more. If these flights were priced at $ 600, it is my guess that these flights will be ‘empty’ and a lot of people will be driving to New York from Indiana.

  • Lisa S

    Ed, I agree with you. Chuck, I think you have a point too, although I do believe flying was more pleasant pre-deregulation. Larry, I believe a larger part of the reason Pan Am went bankrupt is that is wasn’t allowed to have domestic flights. Thus the other airlines (e.g., Continental, United, American) had to provide the domestic flights. Why would people fly two different airlines? Also, Continental, United, and American were allowed to have international flights. They survived while Pan Am (a wonderful airline!) was basically forced to fail. How is that capitalism at its finest?

  • larry

    Lisa S, Lets see, best I remember, Lufthansa, KLM, Iceland Air, Swiss, Croatia Air, Finair, and a bunch of others do not have domestic US flights either and many do not have partnerships with U.S. based carriers, and Pan Am had a European hub in Frankfurt. Ed actually gave a bunch of reasons why Pan Am disappeared such as non stop food, crayons and everything else but the kitchen sink. They could do it then because they had slots and fares set or approved by the government. And lets not forget where the flight crews stayed. Intercontinental Hotels or similar. It may have been a wonderful airline once, but my first flight on them back in 1968 is one I will remember because of the musty smelling plane and a very surly flight attendant. I’ll admit, I do still harbor a bias against them. PAn AM was forced to fail? Heck, even close to the end, Delta invested in them, bought their hub in Frankfurt, and set up a partnership with them. IMO, they died because of the totality of many years of mistakes and they did not do enough on the cost side after deregulation.

  • John

    I love traveling and I know that most of the traveling I do would be impossible with the fares prior to 1978. It’s this fact that really makes me angry when I read all these ridiculous complaints about airlines by people like Chris Elliott himself, who believe that airlines should treat everyone like royalty even though they are flying on a $99 fare from JFK to LAX. They think that that $99 fare (or a similar price) should include checked bags, free meals, hotel and food vouchers in case of weather delays, etc. So in a way, I would be happy to see regulation come back. They delays would decrease; there would be no more checked bag fees and no more change fees; complimentary meals would return; customer service would be a lot better. Of course on the other side of that, it would mean the end of discounted fares of any kind. $250 to fly from NYC to Miami? No…try $1,250. But that doesn’t matter, does it? As long as this supposed “hassle” of flying goes away and the experience becomes more pleasurable, it doesn’t matter that flying will once again become unaffordable to the majority of the population, right?

  • Tom

    First time I flew to Europe, we took a student charter and flew from a secondary airport in the middle of the night. The cost of flying on a scheduled airline was prohibitive. 15 years after deregulation, people were flying to Europe for the weekend. What had been only for the elite, was now for the masses.

    In some ways, I’m sure people have a yearning for the old ways when everybody on the plane was wealthy, an executive, a government employee, or a relative of an airline employee. Planes weren’t crowded and the service was extensive. The reason Jimmy Carter deregulated the airlines was that he wanted to make flying affordable to everyone in part because air service is supported by taxes on everyone.

    The idea that anybody who wasn’t rich could be a frequent flyer is probably the most amazing development in the 30 years since deregulation.

  • Christopher Elliott

    @John no, not like royalty — with dignity.

    I think it’s only a few spoiled elites who demand to be treated like royalty and who are afraid re-regulation will dismantle all the perks to which they believe they’re entitled.

    If you listen to the whole transcript of the Oberstar interview — and I probably should have mentioned this in the original post — you’ll find that he is opposed to re-regulating fares. He just is worried that there isn’t a level playing field anymore. A valid concern.

  • larry

    Lisa, on second thought, you are correct about Pan Am not being able to fly domestically. You stated” how is that capitalism at its finest?” That’s the point, it was not capitalism in a free market, but rather government intervention in a market. I think Pan Am should have been able to obtain slots and pay gate and ticket counter rent where ever they could have worked a deal. Sadly, with the government involved, they couldn’t, so your point is well taken.

  • Carver

    @Chris

    I’m not sure what dignity means, but people have voted with their wallets. They’d rather be treated like cattle than spend more money. Who are we to tell them that we know better?

  • Arizona Road Warrior

    “you’ll find that he is opposed to re-regulating fares.” If he wants to regulate the customer service side without re-regulating fares…that will be a disaster…no wonder our government can’t balance the budget, have huge annual deficits, our debt is growing, why lawyers that are making $ 250K a year at the SEC are watching porn on the taxpayer dime instead of looking for and catching the Bernie Madoffs of the world; why thousands of prisoners who are still in prison received the $ 8,000 tax credit for the purchase of a new house (not talking about spouses of these prisoners); etc.

    “He just is worried that there isn’t a level playing field anymore.” It isn’t a level playing field…the playing field is slanted to the discounters like Southwest Airlines, Jet Blue, etc. which no one like to acknowledge; however, everyone talks about how Southwest and the other discounters drove down fares, driving down fares, etc.

    By the way, if Southwest has the lowest fares…why do they have the highest fare from IND to LGA by $ 260 per person? Even if Ma & Pa Kettles packed their entire kitchen sink for their trip, it will be hard press for them to spend $ 260 per person in checked baggage fees. I call this the ‘Wal-Mart’ marketing…having low fares in the beginning to make people to believe that they have the lowest fares then raising them in the future. That is why Southwest doesn’t allows its fares to be included in the various fare search engines.

    One common statement that is used on why Southwest Airlines has been profitable is that they have one type of plane (737) so their maintenance costs are lower. That is true but why do they have only 737s? Why are there are no Dash-4s, Dash-8s, CRJs, etc. in their fleet and the answer is very simple, they don’t serve the small and medium airports where only the turbo-props and CRJs can land or the volume of passengers can only fill a Dash-4, Dash-8, CRJ, etc.

    Southwest and the other discounters have ‘cherry-picked’ their routes…choosing their routes with the most passengers to fly. They have avoided some airports with high fees and costs. JetBlue got a great financing deal from Airbus so Airbus could get market share from Boeing. If I was starting up an airline, I will do the same thing that Southwest and JetBlue have done.

    Recently, I flew into the Tri-City Airport (PSC) in Pasco, WA. This airport is served by Allegiant, Delta, Horizon and United plus code share flights by AA, CO and US Airways. If Rep. James Oberstar wants to have a level playing, he should introduce legislation that will tax or penalize the other airlines such as AA, Southwest, JetBlue, AirTran, etc. that don’t fly to PSC.

    If the legacy airlines actually charge the real costs plus a marginal ROI for them, the fares to PSC and the other small airports will be very expensive. Another option is to stop flying these ‘unprofitable’ flights to these small airports. I have been told twice by two different airline executives which I don’t know to be true or not but the revenues from the popular routes subsides the flights to these small markets. Also, some airlines (mostly the regional airlines…I don’t think none of the legacy airlines) do receive money from the government for flying into very, very small markets.

    If these legacy airlines have to slash the fares on the popular routes to compete with Southwest, JetBlue, etc., no wonder why all of the legacy airlines have filed for Chapter 11 as least one time in the past ten years.
    I think that the corporate culture at the legacy airlines have been polluted when the airline industry was regulated. I think that the management of these legacy airlines has made several bad decisions over the years. I think that the unions at these legacy airlines have made too many demands. I think that the business models of the legacy airlines are wrong.

    I am no fan of the legacy airlines; however, if Rep. James Oberstar wants service to the medium and small airports which has only been provided by the legacy airlines then pass laws for a level playing by taxing the airlines that don’t serve these airports.

  • David Z

    it doesn’t matter that flying will once again become unaffordable to the majority of the population, right?

    Heh, if only people feel that way…

  • MeanMeosh

    @Arizona – “By the way, if Southwest has the lowest fares…why do they have the highest fare from IND to LGA by $ 260 per person?”

    I’m sure if you pick any random route on any given day, you’ll find examples where discounters like Southwest or JetBlue aren’t the cheapest, or even competitive. I can find other examples where they are cheapest or within a few bucks of the legacies. I did a random check of one-way flights from DAL to DEN on July 23rd, and Southwest beats its closest competitor, $149 to $176 (and those go from DFW). One route doesn’t establish a trend.

    I agree with the majority that oppose re-regulation. First, as Carver pointed out, American travelers have voted with their wallets time and time again, in industry after industry. We want our stuff cheap above all else. What business is it of James Oberstar, or Chris Elliott, or anyone else for that matter to determine what I should and shouldn’t value?

    Second, how exactly do you plan to regulate without regulating fares by default? The attempts at regulation so far seem to focus on what should be included in the base airfare, which means, if you don’t like the airlines charging for things like the first bag separately, you’ll have to accept a $25 or whatever increase in fare. Of course, the same folks on the left who complain now about how evil the airlines are now will be the same ones complaining even louder when that one-way fare from DAL to DEN is raised $100 to account for all the mandatory services that the government says the airlines must provide. We’ll all be hearing about how flying is now the haven of “the rich”, and that profits made from “excessive fares” must be taxed.

  • Joe Farrell

    AZ Road Warrior is 100% right – WN is RARELY the lowest cost carrier in any given market. They advertise low fares – they have a ‘reputation’ for low fares, but they rarely have the lowest fare. If you have to fly at the very last minute, assuming Southwest has seats [which they usually do not] THEN you will find they have the lowest walk-up fare – NO ONE travels last minute except for funerals and medical emergencies. . .

  • MVFlyer

    Interesting how often Pan Am is mentioned as a poster child for regulation. The fact is that Juan Trippe, the CEO of Pan Am, was a master manipulator of the US Government, and effectively minimized or eliminated any competition that would hamper his airline. Once he had to play on a level playing field (i.e. deregulation), the airline went down the tubes rather quickly.

    In the past, airlines were told what routes to fly (and were compensated for flying to small towns) and what to charge. The fares were set to guarantee a profit for the airline, and competition was limited to at most two or three airlines. Service was in general excellent because they were guaranteed a profit, and this was the only form of differentiation. But, to fly between two distant points, you might have to change planes three or four times, make a myriad number of stops, and probably change airlines as well. Not very efficient.

    Nowadays, from many if not most of the population centers of the US, you can fly at a fraction of the effective cost, with no more than one or two changes, pretty much anywhere in the country. Service isn’t what it was, but on the other hand, the purpose of an airline is not to cater to the whims of its passengers, but to move them from point A to point B, something they seem to do remarkably well considering the complexity of their industry.

    (This reminds me of something I heard many years ago while on hold waiting for a Southwest agent to come on the phone–the recording said “Southwest doesn’t serve meals on our airplanes. When’s the last time you heard someone say ‘I’m starving. Let’s get on an airplane!’”)

  • Arizona Road Warrior

    @ MeanMeosh – I live in PHX which is one of the top five airports in the number of daily flights for Southwest. I work for a company that thinks Southwest has the lowest fares and they always want me to price Southwest. So far, the fares on US Airways have been the same or lower. For example, I need to travel to Boston for a trade show this summer, the fare on US Airways is $ 405 and the fare on on CO is $ 406; however, the fare on Southwest is $ 619.

    My point is that Southwest has done a great job in marketing. They got the public thinking that they have the lowest fares. That is why they do not give their fares to the varioius fare search engines.

    In your example of flying from Dallas to Denver, it is unfair to use Love Field and DFW because each airport has different landing fees, gate fees, etc.

    I agree with you…the public has voted with their wallets. There are not willing to pay for service.

  • Chuck

    Southwest USED to have very low fares if you traveled just within the Cali-Neva-Ariz area circa 1999.. Since 9/11 flying sucks and so does my paycheck so I do little else but watch my 900 movie channels. That’s how I talk with my very lean wallet.

  • http://mandel.jerry1@gmail.com Jerry Mandel

    Deregulation has saved me a ton of money on Fares. Before thata we really couldn’t affford to fly.

  • Marian Levin

    Somehow whenever something is de-regulated to “make it better”,it’s the consumer who always loses.

    I have been flying commercial airlines since 1955 and the only improvement I’ve seen is the introduction of commercial jets in 1958. Otherwise, the old adage that “the customer is always right” has been last seen with my lost luggage. Smiles have been replaced with snarls,seats are cramped and made for “Twiggies”, information boards are full of mis-information about flight delays, and service is not a word in the airlines new vocabulary.

    So lets bring the government regulations back. How much worse can it get?

  • Carver

    @Marian

    How does the fact that tickets are much cheaper today than before factor into your thinking? Or the fact that most Americans can afford to fly, whereas before only upper middle class folks could afford to fly?

  • Ernest

    Everyone remembers the “good old days” with fond memories but were they really good?

    We have a tendancy to remember the good times and mentally gloss over the bad times.

    I remember the good old days of my Army career fondly. I loved the Army, made a career out of it and my early years were the best years of my life.
    I seem to have forgotten that I was 18 with no life experience, along with the freezing 3 month long winter field exercises, bad food, poor pay and being afraid of dying in a foreign jungle. Still, they were the good old days.

    The airlines are the same. We forget anything bad and remember the good. Still, other than the cost, I do think the regulated days were better. All this deregulation and fees, isn’t that what we call progress?

  • Steve

    I think it’s just as wrong to claim that Southwest rarely has the lowest fares as it is to claim that they always have the lowest fares. I would guess that with the variability of fares from day to day, on any given day I could find a route where any carrier has the lowest fare. What I can tell you as someone who always researches every flight he books or thinks about booking is that in my experience, on the routes I’ve looked at, Southwest has been the least expensive more than two-thirds of the time. (And they don’t serve my local airport, so when I say “least expensive,” I mean least expensive after factoring in gas to drive to MKE or MDW). It doesn’t bother me that they don’t publish their fares on search engines, since I’d never book anywhere but the airline’s own website anyway, after reading all of the horror stories from people who’ve turned to Chris for help when something went wrong.

    I think Southwest is a perfect example of what people are and are not willing to pay for. Everyone saying “people aren’t willing to pay for service” are only half right. It’s true that people aren’t willing to pay for gourmet meals on flights, huge, comfortable seats, etc (except for the very small minority who can afford to fly first class). But they are willing to pay to be treated like a human being, which SW is great at. It even extends to their pricing (one-way, so you can easily see what it would cost you to pick a different departure or return flight) and ticketing policies. SW doesn’t sell *any* truly non-refundable tickets – even the cheapest fares can be exchanged for full credit toward another ticket, with no change fee.

    My most recent search was for tickets for my wife and her sister-in-law to visit her other sister in NY…I was looking for nonstop flights from either ORD/MDW to LGA/JFK, with a preference for flights from MDW since it’s more convenient and less prone to delays. On the days they’re traveling, SW has a number of MDW-LGA flights for $99 each way, or $219.40/person round-trip with taxes and fees included. No one else can compare. JetBlue flies ORD-JFK for the same price, but every other option is more expensive when you factor in fees for the first checked bag, choosing a seat, etc. Plus if my wife’s plans change and they’d rather have an earlier/later flight, they can change for only the fare difference (if any)…or if they choose not to take the trip at all, we can apply the funds toward another ticket (and it doesn’t even have to be used by my wife).

    That’s why my preference is always for Southwest except in the cases where another carrier is substantially cheaper (which, as I said, in my personal experience has been maybe 1/3 of the time if that).

  • Arizona Road Warrior

    @ Marian Levin – “…seats are cramped and made for “Twiggies”,…”
    - – - – - – - – - – - – - – -
    How will re-regulation will make the seats bigger? The width of the seats has been the same size for over 30 years. The only way to increase the width of the seats are 1) make wider airlines or 2) remove a column of seats…either way will cause the higher fares.

    The simple fact is that there are more overweight Americans due to a lack of exercise, diet, etc. If you like to supersize your meals at McDonalds, you can superize your seat by purchasing a first class seat. If you want more legroom, you can purchase Economy Plus on United or a first class seat.

  • GARNETT LEARY

    PLEASE DO NOT RE REGULATE THE AIRLINE INDUSTRY. YOU ARE MAKING A BAD DECISION RE REGULATE THE AIRLINES. IT IS NOT A GOOD IDEAL TO RE REGULATE THE AIRLINES PEOPLE CAN NOT AFORD TO FLY IF THEY RE REGULATE THE AIRLINE INDUSTRY.
    WE NEED TO KEEP THE AIRLINES DE REGULATED SO PEOPLE CAN AFORD IT. ITS WRONG RE REGULATE THE AIRLINES.

  • larry

    TO…….GARNETT LEARY, We hear ya loud and clear!

  • Jerry

    I think the fact that airlines have lost 10s of billions of dollars since deregulation says it all. These fantastic fares everyone is so excited about are not even covering the costs of operation, let alone offering a fair return on investment. The service sucks because we are not paying the true costs of flying. Forget about the 1970s piano bars on 747s. I just want my airlines to be financially solvent!

    You people should think of airline re-regulation as more like utility regulation. If electricity markets were deregulated, the lights would go off pretty quick (see California around 2000).

  • Carver

    @Jerry

    The analogy does not work. The so called electric deregulation of California in 2000 was a travesty. They regulated part of the market which allowed Enron and its ilk to game the market. The only thing worse than regulation is a partial deregulation.

    Businesses fail all the time. That’s normal in a healthy market and in fact, a good thing, as it strengthens the industry by removing weak player who literally bleed away revenue.

    The question that none of the pro-regulation folks have yet to answer is which is better, the current crappy situation where everyone can afford to fly,or a regulated market with better service, but only a few can afford to fly.

  • Carver

    @Jerry

    Here is the quote from Wiki, “As the FERC report concluded, market manipulation was only possible as a result of the complex market design produced by the process of PARTIAL deregulation”

    Basically the wholesale price was deregulated but the retail price was frozen. Further, the energy companies were required to buy from a specific group, and worse forbidden from entering into long term contracts to hedge fuel bets (the kind that saved Southwest).

    I think most folks, liberal and convervative, alike place the California electric shortage on Enron’s manipulations made possible by Government’s incompetent interference in the market.

    And that’s what the pro-regulation folks want to subject us to.

  • PauletteB

    @Michael: If you don’t have something constructive to discuss regarding the topic at hand, the least you could do is not advertise your ignorance.

  • Steve W.

    I believe in the free market, but when it comes to the airlines, this is a matter of convenience and necessity. The problem is not that there is not enough competition, but that there is too much caused by low cost regional airlines. I believe that this is driving the once glorified industry into the ground. Regional pilot pay is a slap in the face for new commercial pilots. To be competitive, you need a four year degree with 2000+ hours of flight time. Now your looking at investing $100,000 on training and education to get a job that only pays $22,000/year starting and working 16 hours per day to earn it. We should go back to pre 1978 era regulations. Regs on routes, prices, employee pay, etc.. This time around, we should be more conservative, so to not let the unions drive employee pay to ridiculous heights, but also, not let managers pay pilots in peanuts. If you are worried about consumer ticket prices, then just take a look at what’s going on around you now. You buy a ticket, then you pay for your bags (each of them), you get hungry and buy food on the flight, the service is worse than ever before, airport facility charges, fuel, etc.. Or, you get an advertised fee with no hidden charges, pay a little more, includes food, bags, and great service that is monitored by the DOT. In this way, pilots will actually be payed as professionals, service will be great, and the industry will do as it has always done: fluctuate with the economy and even grow. If Disneyland can drive prices up every year, even in a recession, and get away with it, then people will still fly at a slightly higher price to visit family, do business, and go on vacation. And no, this is not socialism. The airline world is already regulated in most areas. In fact, regulation has already taken place in U.S. history. Regulation in the U.S. ended in 1978 and ever since than we have had problems with airport congestion, lawsuits, diminishing service, and reduced quality of life for the professionals that work in the industry.

  • jojo

    Flying for one dollar each way and you think this is great…… you need a serious reality check.  How can an airline make money doing that?  Who cares right…. you got your cheap flight, who cares if the mechanic’s job is outsourced, safety is compromised and the workers are worked like rented mules….. you got your one dollar flight so all is great.  

  • http://www.facebook.com/judith.siess Judith Siess

    I vote for regulation. You knew that you could fly from your home airport (since the government required the airlines to serve smaller markets), you knew the cost, you knew that you’d get decent service, you could take a bag AND check one. In return, the airlines knew that they would make a profit–a small profit, but a profit. And if they don’t have to spend millions for computer systems to change fares every second and don’t have to spend millions on advertising, the fares could be lower.

    As for comparing it to phone service before and after regulation, before you had fewer choices of phones, but what was supported by Ma Bell and worked anywhere on the system. Now you have so many choices you never know what to choose and some work with one system, one with another, and no one with all. And I don’t think my phone bill is really much lower, it’s just spread among AT&T for house and internet, Verizon for cell, and Dish for “cable.” Oh that I could just write one check, call one number for service, and have some confidence that the equipment would work on a regular basis.

    PS. I’m 65, but a heavy user of internet.