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Airline Travel, Regulation, and The Disappearing Middle Class

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Since the events of United 3411 numerous stories have appeared in the press about fresh incidents of airline “mistreatment” of passengers.  Most of them strike me as pretty routine stuff, but now it is getting coverage because United 3411 has everyone reading stories about this stuff.  Therefore I will not link to any of it.  A good bit of the remainder is passenger hypersensitivity in the wake of the United 3411 incident and coverage.  But regardless, I think some observations are in order.

For the record, I am a moderate air traveler.  I am on airplanes far more frequently than most people, but far less frequently than a serious air traveler like Hewitt.  I average about one trip by air a month and have for many years.  Usually just an out and back, not a lot of hopping around although that does happen once or twice a year.  In all that air travel I have never seen a confrontation turn physical in any fashion, but I have seen a lot of confrontation.  In all the confrontations I have witnessed at least 30% of them involved the over consumption of alcohol on the part of the passenger or passengers involved.  All of the confrontations I have witnessed – I repeat all of them – have involved passengers with expectations way out of line with what they were paying for and/or what regulation allowed.  I guess because most people do not travel by air that often they just don’t realize that unless you are willing to pay for it, there is nothing luxurious, or even really comfortable, about air travel.  All those super cheap fares you see ads for have turned air travel, at least in the back of the plane, into little more than fast bus service.  And there is not much, really, the airlines can do about it.

In the wake of United 3411 I wrote about how heavily regulated the “deregulated” airline industry actually is.  All those regulations put a baseline on the cost of operating an airline, so they have to get very creative in order to compete.    Due to all that regulation, unless an airline is willing to accept some pretty serious compromises (only operate a single type of aircraft, serve a very limited number of routes, use only high-hour, older aircraft) customer service is about the only place they can save costs.  When you add to that the purely uncontrollable in air travel (weather, airport traffic…) things really can get ugly.  But those facts notwithstanding, people want cheap tickets, and so the airlines being good business people, give them what they want.  The bottom line is you get what you pay for.

If you think about it, what is happening in air travel right now is a harbinger of what is to come in so many things.  Regulation tends not to be the leveler that everyone thinks it is, it tends to differentiate excessively.  Those with the expertise, creativity and capital to deal with the regulation succeed wildly, those without such, and frankly that will always be most people, end up in the back of the plane.  You want to know what the future of healthcare looks like under Obamacare – look no further than air travel industry.

Much is made of the disappearance of the middle class in the last decade.  Its disappearance can be traced directly to to the abundant regulation of the Obama administration.  The anger at the airlines, the anger that elected Donald Trump and the anger that is to come if healthcare is not fixed comes from people thinking they are in at least the middle class and discovering that they are actually in steerage.

Our prosperous future lies not in getting more from government, but in doing more for ourselves.  The regulatory rollbacks of Trump’s first 100 days are far more significant than anybody realizes.  Trump the public grouser does not do much to build optimism in the public.  But Trump the government actor certainly does.

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