The Department of Transportation announced yesterday that reimbursements to ‘bumped’ passengers will increase to $400-800 on all planes with 30 seats or more. The new rule will go into effect in May, and is one of many attempts (also including an ‘escape route‘ over Canada from NY airspace) by the department to reduce consumer frustration with the airline industry. According to Bloomberg, this is the first increase in such payments since ’78.
This undoubtedly raise questions regarding who will qualify as being ‘bumped’ and how often individuals
actually get paid. Does the flight I purchased three months in advance and then discontinued due to lack of passengers along that route two months in advance constitute a ‘bump’? Are those who voluntarily give up seats on overbooked flights entitled to the $400 as well as other incentives? Will this new bumping rule actually decrease flight delays, which are more typically caused by mechanical problems or weather than overbooking?
Still, I think the new rule is a step in the right direction, and one of the reasons I’m not a libertarian. If air travel is getting more and more hectic and stressful, and airlines are still going bankrupt, someone has to step in to cover the discrepancy between consumer desire and corporate structure. Maybe a part of that covering will involve new rules instituting fewer flights per day or more efficient planes, but it’s not something that the masses can demand from airlines easily or directly. If we lived without government, or with minimal government, it might eventually happen through a group of concerned citizens coming together to advocate for the change, but personally I’m glad to see the government already in place starting to do the work it’s supposed to.