Don’t Ask the Government to “Fix” United Airlines - Government Caused the Problem

united

Calls for Federal involvement in the disastrous treatment of customers are ignorant of the fact Federal restrictions have contributed to the problem.

The internet erupted this week as video was released showing a United airlines passenger being physically carried off of a plane. The episode involved over-booking the flight, and the actions of the airline, plus its resulting blundering PR moves, have become the stuff of corporate nightmares. And the public is outraged!

In typical fashion, people online exploded over an affair that did not pertain to them personally, involved a person they did not know, and a company many were not likely to be using. “This doesn’t concern me directly — TO THE PITCHFORKS!!!” was the rallying cry across the web. The Democrat party, after months of demonizing President Trump, must be dismayed to see the public this motivated over a far less vital issue.

But the most obtuse reaction to be heard in the ether is the call for the Federal government to step in and “fix” this issue. This is a knee-jerk reaction for many on the left, who automatically cry out for nanny-state redress whenever an insurrection takes place. In reality reasons abound why the government should stay out of this issue.

The motivating factor for many to say “the government needs to do something!” rests in the inherent animosity felt towards corporations by many on the left. They distrust companies as harboring a hostile attitude in the nefarious pursuit of avarice. Hilariously they then turn to the largest offender for help. They are incapable of thinking it through; in the battle against perceived impersonal acts, greed, and corruption they want the government to help?!

Another reason intervention should be avoided is that it is not needed. Look at the foibles committed by the company here. They overbooked the flight, and they wanted to bump passengers not due to too many flyers but because United needed to get four of its employees to the destination. Authorities were called in when an arbitrarily selected passenger was obstinate about remaining on the flight. He was removed for not volunteering, essentially. But, it turns out, the airline was in their right to do so. The largest problem was possibly in handlers not addressing this prior to boarding, but legally United was doing what it was permitted in removing the passenger.

After all of this, and the immense blowback the airline is receiving, there is no real need for government intervening on the episode. The marketplace is reacting to take issue with United. The company’s stock dropped nearly 3%, losing $600 million in market value, in anticipation of long term customer flight. Consumers voting with their wallets will compel a company to fix and improve things far better than an authority mandate.

That brings up the largest issue behind not bringing in federal authorities for this disembarking debacle — the government is already involved in this affair, and it largely contributed to the mess. If you are seeing people who decry the lack of government oversight, and claiming that it leads to airlines overbooking flights, you are permitted to laugh in their face.

Oversight on the matter is by the Department Of Transportation (DOT) and the law actually permits for the overbooking of flights. According to the legislation this is all part of the contract when flying using what are called “deliberate overbooking procedures”:

  •  Notice – Overbooking of Flights          Airline flights may be overbooked, and there is a slight chance that a seat will not be available on a flight for which a person has a confirmed reservation. If the flight is overbooked, no one will be denied a seat until airline personnel first ask for volunteers willing to give up their reservation in exchange for compensation of the airline’s choosing. If there are not enough volunteers, the airline will deny boarding to other persons in accordance with its particular boarding priority. With few exceptions, including failure to comply with the carrier‘s check-in deadline (carrier shall insert either “of _ minutes prior to each flight segment” or “(which are available upon request from the air carrier)” here), persons denied boarding involuntarily are entitled to compensation. The complete rules for the payment of compensation and each airline’s boarding priorities are available at all airport ticket counters and boarding locations. Some airlines do not apply these consumer protections to travel from some foreign countries, although other consumer protections may be available. Check with your airline or your travel agent.

Fine, it is legal for them to do so. However, as many have suggested, this fiasco could have been remedied by granting the passengers more offers to accept being bumped. Why didn’t United dangle higher incentives to get people to comply?

Because they are limited from doing so — by the government. Another DOT statute places restrictions on how much compensation is allowable to be granted for passengers involuntarily denied boarding. It is a complex matrix (shocking for government policy, I know) based on ticket pricing, and other contributing factors.

So government policies allow overbookings, and they limit the compensatory parameters to encourage passenger cooperation. Not hard at all to see how this problem arises; it is extremely hard to grasp why anyone thinks involving the government is a solution.