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 The Brancatelli File

joe IT'S STILL THE FARES, STUPID

BY JOE BRANCATELLI

May 15, 2003 -- Led by the Big Six, most of the nation's airlines raised their fares by $5 each way over the weekend. The fare hike goes into effect for travel beginning on June 1, the day the so-called "9/11 security surcharge" is sent on a 90-day hiatus as part of Airline Bailout II.

Let's forget for a moment that the robber barons who run the Big Six went before Congress and claimed that it was that $5 surcharge that had broken the financial back of business travelers and convinced us to stay home. And let's forget for a moment that the airlines will blame the government when fares rise again on the day the 9/11 surcharge returns.

What we need to do today is remind the mobility moguls of the real reason why business travelers aren't flying with them: It's still the fares, you insufferable idiots.

Over the years, business travelers have put up with most of what the Skygods have thrown at us. We survived the incompetent service, the petty deceptions of the grandiose alliances, the knee-busting seat pitch, the interminable delays, the fascist ticketing policies, the downsized planes, the frequent-flyer programs that now look like three-card monte games and the colossal idiocy of treating your best and most profitable customers like trailer-park trash.

But when they tried to rip us off, too, that's when we got annoyed and stopped flying the Big Six.

And make no mistake about it, fellow travelers. The Big Six long ago abandoned any pretense of fairness or fiscal restraint. The richer-than-thou gluttons who run the Big Six have lost touch with any sense of pricing propriety.

Think I'm kidding? Pick a route. Any route. How about New York-Los Angeles? That's frequently the nation's busiest route. It's always been the nation's power and prestige route. It also happens to be unusually competitive: No fewer than four of the Big Six offer nonstop service between Los Angeles International and Kennedy or Newark. And it's also where JetBlue is kicking Big Six ass, offering $299 walk-up fares from Kennedy to Long Beach or Ontario.

But grab the next Big Six nonstop to the coast today and you'll shell out $1,233 one way for the unrestricted walk-up fare. That is 460 percent more than the $220 walk-up fare in 1978, the year we deregulated the airlines. Plan ahead, you say? Sure. If you can book three days in advance, the Big Six will graciously knock $90 off the fare and charge you $1,143. That's a mind-boggling 549 percent more than the $176 night-coach fare of 1978. Determined to get a deal from a Big Six carrier? If you book seven days in advance and put up with the nonrefundable fare and the $100 charge for changes, United Airlines will sell you a roundtrip for $1,240--or a staggering 252 percent increase over the roundtrip night-coach price in 1978.

These terrifying tariffs led me to pull together a few statistics on the cost of living back in 1978. And contrary to the shrill protestations of the fiscal terrorists who run the airlines, the price of business travel over the last 25 years has become an unvarnished, unalloyed, undeniable national scandal.

As you can see by the chart below, the unrestricted fare between New York and Los Angeles has risen two and a half times faster than the increase in the nation's Consumer Price Index. That three-day advance-purchase fare has increased more than four times faster than the price of a bottle of good Champagne.

Why is it that the annual fee for a Diners Club card has risen only 171 percent since 1978, but unrestricted New York-Los Angeles fares have risen 460 percent? How come the Big Six think raising our three-day advance purchase fares more than 500 percent is palatable, but New York's Four Seasons restaurant has prospered with only a 243 percent rise in the cost of its prix-fixe dinners? Why has the three-day fare between New York and Los Angeles risen at twice the rate as the price of the cheapest room at the Palmer House Hilton in Chicago?

And while we're at it, let's also demolish the airline-perpetrated myth that they are testing more reasonable business fares. Check the chart and look at the fares between Chicago/O'Hare and Dallas/Fort Worth, a route dominated by three of the Big Six.

The unrestricted walk-up fare between Dallas and Chicago is $775, which is an unbelievable 733.3 percent increase over the $93 unrestricted fare in 1978. The capacity-controlled "biz flex" fare that several carriers offer in the ORD-DFW market is $399, which is nevertheless a startling 439 percent higher than the $74 night-coach fare that was 1978's version of a discounted business-travel price.

Can you fully comprehend that set of numbers? The Big Six have cut their Chicago-Dallas walk-up fares almost in half and they are still 400 percent higher than they were in 1978!

By the way, here are a few extrapolations that you won't find on the chart. If the Big Six were in charge of gasoline and ran up prices along the line of the unrestricted fares in the Chicago-Dallas market, you'd be paying about $4.90 a gallon. Instead of paying $2 for a dozen pencils, you'd be paying about $16.75. And if the guy who increased the "straight Y" fare in the ORD-DFW market to $775 was in charge of long-distance prices, you'd be paying about $2.55 for a one-minute phone call.

Which pretty much explains why the Big Six are on track for several billion more in losses this year. They sell a product we hate at prices that have set new records for obscenity. And having priced themselves into the stratosphere, the Big Six are nearing the last stop of a 25-year flight to oblivion.

THE SKYROCKETING COST OF FLYING

WHAT YOU'RE BUYING

1978

2003

INCREASE

UNRESTRICTED WALK-UP COACH ONE-WAY
Chicago/O'Hare-Dallas/Fort Worth

$93

$775

733.3%

RESTRICTED BUSINESS COACH ONE-WAY
New York/Kennedy-Los Angeles International

$176 (a)

$1,143 (b)

549.4%

UNRESTRICTED WALK-UP COACH ONE WAY
New York/Kennedy-Los Angeles International

$220

$1,233

460.4%

RESTRICTED BUSINESS COACH ONE WAY
Chicago/O'Hare-Dallas/Fort Worth

$74 (a)

$399 (c)

439.1%

FIELD-LEVEL SEAT FOR A BASEBALL GAME
Philadelphia Phillies at Veterans Stadium

$6

$28

366.6%

ORCHESTRA SEAT FOR BROADWAY PLAY
Saturday night at the Helen Hayes Theater (f)

$16.50

$70

324.2%

COPY OF TIME MAGAZINE
Single-copy cover price

$1

$3.95

295.0%

RESTRICTED BUSINESS COACH ROUNDTRIP
New York/Kennedy-Los Angeles International

$352 (a)

1,240 (d)

252.2%

DINNER AT THE FOUR SEASONS
Prix-fixe Theater Dinner

$16

$55

243.7%

HOTEL ROOM FOR A NIGHT IN CHICAGO
Minimum rate at the Palmer House Hilton

$48

$164

241.6%

RESTRICTED BUSINESS COACH ROUNDTRIP
Chicago/O'Hare-Dallas/Fort Worth

$148 (a)

$468 (e)

216.2%

U.S. CONSUMER PRICE INDEX
All Urban Consumers/U.S. City Average (g)

65.2

184.2

182.5%

DINERS CLUB CARD
Annual membership fee

$35

$95

171.4%

TRAVEL GUIDEBOOK
Frommers England

$5.95

$15.39 (l)

158.6%

POSTAGE STAMP
First Class, One-Ounce Letter Rate

15 cents (k)

37 cents

146.6%

BOTTLE OF CHAMPAGNE
750 ml of Perrier-Jouet Grand Brut

$11.95

$26.95

125.5%

A.T. CROSS BALLPOINT PEN
Chrome Classic model

$8

$17.89

123.6%

GALLON OF REGULAR GASOLINE
AAA national average/unleaded self-serve (h)

67 cents

$1.496

123.2%

MUSIC ALBUM/SUGGESTED RETAIL
Long-play record in 1978; CD in 2003 (m)

$8.98

$18.98

111.7%

BATHROOM TOWEL
Fieldcrest Royal Velvet hand towel

$4.50

$8.99

99.7%

U.S. HOURLY MINIMUM WAGE
As set by the Fair Labor Standards Act

$2.65

$5.15

94.3%

BOTTLE OF CANADA DRY CLUB SODA
28 ounces in 1978; 1 liter in 2000 (i)

65 cents

$1.19

83.0%

DESK DICTIONARY
Webster's Collegiate Dictionary

$10.95

$17.47(l)

59.5%

ONE DOZEN DISPOSABLE RAZORS
Bic Lady Shaver model

$2.94

$2.99

1.7%

ONE DOZEN PENCILS
Dixon Ticonderoga #2 model

$2.29

$1.99

(13.1%)

ONE-MINUTE TELEPHONE CALL
New York-Los Angeles, residential rate (j)

35 cents

10 cents

(71.4%)

KEY: Fares in 1978 were listed in the August 1, 1978 edition of the Official Airline Guide. Current fares were listed at Travelocity.com on May 14. All flights nonstop. All prices include taxes and surcharges.
(a) Night coach fare
(b) Three-day advance-purchase fare
(c) BIZN fare, which requires no advance purchase or Saturday stay
(d) Requires 7-day advance purchase; nonrefundable; $100 change fee; United only
(e) Requires 7-day advance purchase; nonrefundable; $100 change fee; Saturday stay
(f) 1978: Touch of the Poet (Jason Robards); 2003: Say Goodnight Gracie (Frank Gorshin)
(g) 1978 average versus March, 2003 rating; 1982-84=100
(h) 1978 price is annual average; 2003 price updated on May 14
(i) 2003 price NOT adjusted down to account for larger volume
(j) 1978 rate from New York Telephone after 5 p.m.; 2003 anytime rate from Verizon using eValue plan and adjusted upward to include pro-rated amount of required fees for service
(k) Effective May 29, 1978
(l) Purchased at Amazon.com; free shipping on purchases over $25
(m) 1978: Living in the USA (Linda Ronstadt); 2003: American Life (Madonna)


This column originally appeared at JoeSentMe.com

Copyright 1993-2004 by Joe Brancatelli. All rights reserved.