FAA Reauthorization Act

Floor Speech

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Mr. MARKEY. Thank you, Mr. President.

It is Congress's obligation to protect the public from abusive practices that harm consumers and dull the competitive process. Regrettably, Congress has failed to fulfill that obligation with the FAA reauthorization bill.

With this bill, Congress has missed a historic, once-in-a-generation opportunity to stop gargantuan airlines from gouging Americans with exorbitant fees. Last year, Senator Roger Wicker, a Republican from Mississippi, and I secured a provision in the Senate FAA reauthorization bill that would protect passengers from ridiculous, sky-high airline fees. Our FAIR Fees--Forbidding Airlines from Imposing Ridiculous Fees--provision directed the Department of Transportation to, No. 1, assess whether change and cancellation, baggage, and other fees are reasonable and proportional to the costs of the services which are being provided, and secondly, to ensure that change and cancellation fees are reasonable.

Airline fees would be fair and reasonable--that is all the provision did. The reason we need that is simple. In a truly competitive industry, an airline would be unable to charge unreasonable fees because their competitors would undercut their prices. Darwinian, paranoia-inducing competition would drive down fees to reflect the actual costs of the services provided--the cost to check a bag, the cost to change a flight reservation, the cost of booking a passenger on standby for an earlier flight. Fair and reasonable. But the airline industry is far from competitive. In the past 10 years, we have gone from 10 major airlines down to 4. Four airlines now control 85 percent of traffic in the skies. An analysis from the U.S. Travel Association found that 74 airports are served by only 1 airline, while 155 airports are dominated by 1 carrier controlling over 50 percent of seat capacity. Here is the result: sky-high airline fees and a growing frustration with the modern flying experience.

To the surprise of no one, the airline industry launched a ferocious lobbying blitz against our bipartisan FAIR Fees provision, making its elimination from the bill their top priority. The airline industry lobbed all sorts of false accusations against these commonsense protections--profitability of the airlines would go down, passengers would no longer be able to change or cancel their flights--but not once did the industry actually defend the price of all of these fees to cancel or to change a flight. Not once did the industry actually demonstrate that their fees are reasonable and proportional to the cost of the services provided. That is because those costs are not proportional to the services being provided to the customer by the airlines.

The independent Government Accountability Office, GAO, recently released a report confirming what countless passengers across the country already know to be true: Airlines are gouging captive passengers to line their pockets, not to cover the actual costs of the services being provided. During a hearing last year, representatives from United Airlines and American Airlines testified that their change and cancellation fees bear no resemblance to the costs borne by the airline for actually canceling a ticket or changing a flight reservation.

Even in the past few weeks, as we worked in Congress to include important consumer protection measures in this final FAA legislation, the airlines continued to raise fees. That is how confident the airlines were that their powerful industry lobbyists would remove my provision and Senator Wicker's provision from the bill. Despite bipartisan support, despite the provisions included in the Senate bill, and despite the public outcry, the airline lobby knew that they could count on Congress to do their bidding, so they raised their fees anyway.

Last month, JetBlue Airways changed its cancellation fees from $150 to $200 for certain flights. JetBlue also raised fees for a passenger's first checked bag from $25 to $30 and increased the fees for a second checked bag from $35 to $40. That is $140 to check two bags roundtrip. Not surprisingly, almost immediately after, United Airlines, Delta Airlines, and American Airlines followed suit, raising their bag fees to match JetBlue's.

When I sent letters to the 11 major airlines inquiring as to why airline fees are on the rise even though there appears to be no appreciable increase in the cost of services provided, the airlines' response was predictable.

Eight airlines had refused to respond to my inquiry by last Thursday's deadline--a deadline I set to ensure that this body would have this critical information in hand when considering the FAA bill. There has been no response from United, American, and Delta. That is unacceptable. Of the three airlines that did respond, two could not explain whether their fees were reasonable to the costs of the services provided. The other refused to address the matter altogether, claiming that this information is ``proprietary,'' claiming that the flying public does not have the right to know if they are being gouged. That is the airline industry's position.

If it is not to cover the cost of the services provided--checking a bag, changing a flight reservation, canceling a ticket--why are the airlines charging these fees? The answer is, because they can. Last year, the airlines raked in $2.9 billion in change and cancellation fees. That is equivalent to the cost of 11 million flights from Washington to Boston. The airlines collected over $4.5 billion in checked bag fees, which is enough to buy 55 jumbo jets. The airlines have turned this nickel-and-diming into a multibillion-dollar industry--a $7.4 billion industry last year. Passengers think they are buying low-cost airfare, only to be gouged by proliferating airline fees.

The American public wants Congress to stop these abusive practices, and here in the Senate, we answered their call. We secured a bipartisan provision in the Senate FAA bill that would have stopped this fee epidemic once and for all. But through an opaque process and after months of lobbying against my bipartisan FAIR Fees provision, the airlines won and airline passengers lost.

What exactly are the airlines so afraid of? Why won't they even respond to my letters? The FAIR Fees provision doesn't set fees; it only directs the Department of Transportation to set up a public process to assess those fees. But that is exactly what the airlines oppose. They don't want to have to explain this, to be transparent about what they are doing, because if they did, the American people would know the truth--this is price-gouging in its purest form.

On behalf of the American flying public, the millions of Americans who are subjected to ridiculous airline fees, I will vote no on the FAA bill. And I vow to the public that this fight will not die with this bill. As the fees rise, pressure will mount on Congress to address this consumer protection, competition issue. We know the problem. FAIR Fees would have been the solution, but this bill does not include that solution, and this fight must go on.

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