While reading through the news the other day, I ran across an interesting article on airline fees. No, it’s not the fact that airlines made $22 Billion in fees last year. Rather, it is the story of an airline passenger who had to pay $60 for Economy Plus seating on United. But, you’re probably thinking, those seats are optional. He could ride in Economy for free. Wrong. It appears that certain United flights (supposedly all flights LAX-JFK and SFO-JFK) are what are termed “Premium Service” flights, and they have no economy seats. Still, the pricing of the flight reflects free economy seats; you don’t learn you need to pay $60 more until you select your seats. Evidently, this is a loophole around displaying the total price they are mandated to post. We all know this isn’t the only sneaky airline fee. It’s yet another example of corporations going after the profit whereever they can.
We’ve seen this in lots and lots of places. Bank profits are up, but are they doing more for their customers. Probably not (I wouldn’t know — I use a credit union). Look at energy companies. In the wake of the Enron scandal and their manipulation of California energy prices, California instituted new rules to prevent manipulation of the market. JP Morgan figured out a loophole, and has been manipulating the market to make billions of dollars. Recently, Capitol One has been ordered to pay millions of dollars in fines for deceptive practices.
What are these companies doing with the profits? Hiring more workers and solving the employment problem? No. Paying obscene salaries to executives? Ding-ding-ding. Meanwhile, the middle class can’t afford to purchase products, and the belief, at least in certain political sectors, is that if you reduce taxes on those obscenely well-paid executives and the people making lots of money off of interest income, this will make the companies hire more.
This is why I believe there is a role for government. Left to their own devices — free of government intervention and regulation — people will take advantage of other people. This is why these laws came into being in the 19th century and early 20th century — to stop the abuses by corporations. Right now, Corporate America has far too much power and greed for their own good.
Music: Johnny Guitar (2006 Off-Broadway Cast): What’s In It For Me?