With the election of Donald Trump as president, we're probably about to hear a lot more complaining about the evils of government regulation, perhaps as Ronald Reagan famously did when he said, "The most terrifying words in the English language are: I'm from the government and I'm here to help."
But like most matters involving the intertwining of government and the private sector, the reality of federal regulations is more complicated than most politicians like to admit. And there's no better example to make that point than how Washington deals with the airline industry, as evidenced by the new regulations unveiled last month by U.S. Transportation Secretary Anthony Foxx that would help ensure passengers are both better informed and better protected.
For those who have avoided airports over the last 40 years, here's an update: Passenger air travel has become cheaper but sometimes horrifying. Since the deregulation of the Reagan era, low-cost air fare has proliferated, but travelers have paid a price. Planes are crowded, seats are smaller, niceties like meals are few and, in recent years, add-on fees — extra charges for baggage, carry-on or checked; slightly more leg room; guaranteed seats; airport check-in and other services once considered standard — have proliferated.
As painful as air travel has become, Americans are loath to give up their discount fares. So what is government's proper role? As the new rules make clear, it's to make sure that in this uncertain environment, travelers are still treated fairly. If an airline promises a service for an extra charge, it ought to be delivering that service. So one of the first protections offered by the new rules is to require airlines to reimburse passengers for delayed luggage. If, for example, the bag you checked with Spirit Airlines didn't make it to your destination airport, then Spirit Airlines had better refund that $30 handling charge.
And there are other protections, too. More carriers will be required to report data such as on-time records and over-sales (smaller airlines had been exempt from such reporting) and all airlines will have to report to DOT more information about mishandled bags. In addition, the department is pursuing a separate rulemaking to make sure consumers are fully informed about add-on charges and how much they cost at all points of sale, whether that's on an airline website or a travel agent or an online service like Travelocity, Orbitz or Expedia.
This isn't the first time that Congress has authorized DOT to intervene in reaction to widespread consumer complaints about the airlines. But formulating such rules isn't easy. Under 2010 rules that penalized airlines for late departures, for instance, some carriers simply started canceling more flights. That spared them millions of dollars in fines, but it hardly helped consumers. In such cases, the answer isn't to deregulate or necessarily to toughen up but to collaborate in devising rules that will promote transparency and set minimum standards of service.
The process seems to be working. As painful as air travel may be, surveys suggest consumer satisfaction is actually on an upswing. A 2016 J.D. Power study found travelers are overall as satisfied with the experience as they have been in a decade. Even passengers annoyed by add-on fees found the "a la carte" approach slightly less troublesome than the year before, according to the study. Meanwhile, traveling on a U.S. passenger jet remains one of the safest forms of transportation, with no fatal accidents since 2009 despite serving more than 700 million passengers annually, according to National Transportation Safety Board data.
Airline patrons may still find plenty to complain about when they head home this week for Thanksgiving, a peak travel time, but it won't be for an excess of government red tape. As Secretary Foxx noted, this is the third time DOT has issued rules to protect the interests of passengers. It probably won't be the last. In the real world, regulations aren't all good or all bad, they are simply a tool to assure positive outcomes that market forces left alone won't produce.