Comment by xoa | Hacker News Reader

Comment by xoa | Hacker News Reader

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>Because airlines don't -and can't- promise incident free travel.

That's a strawman of the request, not the request. The request is that, same as anything else in a proper Free Market, the price includes all costs and internalizes all direct risks. I'm paying $XYZ to be delivered from point A to point B on a given date with a ~roughly given time. I don't expect there to never ever be trouble, that's life. I do expect them to take care of all trouble however, as I am in their care. If they create a need for a hotel stay, then they should pay for that. If they lose luggage, they should pay for that. If they have to reroute, put me on another mode of transportation, or whatever, that should all be their problem. And if they can't deliver reasonably appropriate service they should partially or fully refund the purchase.

This is critical to a functioning market. If Airlines Alpha & Beta both have a incident rate of 0.5% but Airline Omega has an incident rate of 4%, what should happen is Omega has to compete or go out of business vs the other two (and then someone new comes in and gets the assets to try a different approach). Maybe they save enough money over that they can offer lower prices anyway, or have high enough quality or unique offerings elsewhere to charge a higher price, or accept even lower margins, or some combo. But what cannot be allowed is for them to externalize that onto the public, because then the prices are fraudulent and no longer comparable between competitors. The market can't respond if the pricing signal gets muted. Unsurprisingly lots of players would love to be able to advertise a lower price not through actually earning a lower price but just socializing costs, but that's not ok.

>But let's be real, their slim margins cannot support bonusing out every passenger with a sob story about getting delayed.

Horse baloney, margins have nothing to do with this. Every airlines can and should be held to the same standard, so it's just a universal cost same as jet fuel. They're all in the same boat so long as they perform the same. If some airlines have much higher failure rates then others, then yeah they're going to have to address that somehow and that's exactly how it should be! Normal adult businesses deal with this via prevention, insurance and buffers, it's simply a cost of doing honest business.

I just want to note that pretty much all airlines and travel credit cards and other similar services offer travel insurance products that deliver this exact “take care of every travel risk” coverage if you want it. You just have to pay for the real cost of that service.

However, your airline ticket alone is not that. It’s just a contract to carry you from point A to point B, and that will happen at a scheduled time if everything goes well.

Everything else that you infer should be in the service contract is a fantasy. It is simply not part of the product. You can go ahead and read the contract for yourself, every airline posts them.

Furthermore, there are basically no product categories that include all possible costs and internalizes all risks. Every single thing you buy has some kind of risk involved.

If I buy a ticket to a broadway show, they can refund me or give me a makeup date if there is an unexpected cancellation, but they will not reimburse all my costs of being in town on that day or compensate me for not having anything else fun to do with my time. They don’t know or care if I traveled across town or across the world to see that event. It’s not their financial responsibility if I blew $2,000 flying to NYC from some far away country to see their event.

When I pay my electricity bill including the flat delivery charges, my utility doesn’t guarantee that power will be uninterrupted and they don’t compensate me for outages. Even if they do compensate me for outages, they don’t compensate me based on the specific amount of disruption it caused in my life. I don’t get to tell the utility company “I work from home as a lawyer and this outage cost me $500/hour” and magically get that amount compensated to me.

If my local baseball game gets rained out and the game is made up another game, it’s not the team’s responsibility if I’m no longer in town or can’t make the new time. They even sell insurance for this very possibility when you buy group suite tickets. If you don’t buy the insurance you are SOL during a rain-out.

You can’t even really buy a consumer product and expect it to be problem-free for very much time. When you buy a car there’s no guarantee that there will be a set cost of maintenance or that unexpected problems will not occur, there’s only a highly limited warranty to cover manufacturing defects. Warranty length and coverage varies widely by manufacturer.

Numerous products are sold with no refund possibility of any kind. Just try to get a refund from your local McDonald’s franchise. They’ll never do it. They will give you replacement food, but they will never give you your money back.

Software has no warranty. At all. Period. Not even enterprise software. At best you get a service agreement where you get some kind of pittance of a reimbursement when something goes wrong.

>I just want to note that pretty much all airlines and travel credit cards and other similar services offer travel insurance products that deliver this exact “take care of every travel risk” coverage if you want it.

And that's wrong. Same as warranties on products being far, far below reasonably expected working lifetime but with the option to have an added warranty. That sort of behavior is very common in our society at this point, but it's all bad.

>You just have to pay for the real cost of that service.

Ie, you just have to except the airlines externalizing that onto society right now. Doesn't mean we can't advocate for a free market instead though.

>Everything else that you infer should be in the service contract is a fantasy. It is simply not part of the product. You can go ahead and read the contract for yourself, every airline posts them.

You are demonstrating incredibly muddled thinking here, as well as leaping into your own brand new strawmen. Saying how things "should" be by definition is not saying how they are. I argued specifically against a strawman and incorrect point, and I said that it was a "request", I never claimed the contracts were secret or didn't have all sorts of BS escape clauses that, in many jurisdictions (though not so much in the EU), are unfortunately legal.

>If I buy a ticket to a broadway show, they can refund me or give me a makeup date if there is an unexpected cancellation, but they will not reimburse all my costs of being in town on that day or compensate me for not having anything else fun to do with my time.

The broadway show doesn't involve taking physical control over your physical body in time and space. You cannot just step out and leave partway through a flight. That you'd use this as an example is either stupid or malicious.

>When I pay my electricity bill including the flat delivery charges, my utility doesn’t guarantee that power will be uninterrupted and they don’t compensate me for outages

Your utility is massively regulated and depending on jurisdiction yes, they will indeed pay for certain levels of issues, as PG&E has been discovering in California over the last few decades. You don't pay for power not delivered, you are allowed to generate your own power and store it. There are SLAs available for utility services as well.

>You can’t even really buy a consumer product and expect it to be problem-free for very much time

>Numerous products are sold with no refund possibility of any kind. Just try to get a refund from your local McDonald’s franchise. They’ll never do it. They will give you replacement food, but they will never give you your money back.

Which, again, is bad, not good as you are arguing. That bad stuff exists elsewhere does not in fact mean we can't want to improve where possible incrementally.

Yes, we live in society the whole time, and no doubt you are very smart.

Where I find this subject difficult to converge to is the exact point of “things should be” lies.

I would be in agreement with you that more customer protections are usually a good thing and that most jurisdictions on this planet really don’t have enough of them. Certainly I would agree that airlines shouldn’t be allowed to engage in as many anti-consumer games as they play in the status quo.

That said, I think we can both understand that there has to be a limit at some point to the risk internalization that a business can be reasonably expected to bear just to exist and sell products. Otherwise, it pushes costs higher for everyone and makes competition more difficult to come by.

It also limits product choice because many consumers prefer to choose higher risk options specifically to save on cost.

If airlines have to charge 10% more now because they have to compensate everyone’s hotel, car rental, and wasted DisneyWorld tickets for every canceled/delayed flight (I’m not saying you are advocating for such a thing, just a hypothetical), and I’m a customer who has a flexible schedule and never utilizes those compensations, now I’m just paying 10% more to get no additional protection for me personally.

This concept is essentially imposing a risk tax on all of society to normalize risks, and it might be argued that such a tax is not very progressive or productive.

Regardless of where we decided to specifically draw the line, any increase in compensatory duties imposed on airlines will increase pricing for their services. The airline industry is the perfect case study for that idea because it’s essentially a zero-margin business. Almost every US airline loses money flying and makes up for those losses with credit card programs. So if they have to start compensating for more scenarios, our ticket prices are going up, guaranteed. It’s not like Apple where imposing mandatory replaceable batteries or a 2 year warranty would barely change the economics of their business and greatly benefit consumers.

My main idea was not to bring up a bunch of irrelevant strawman examples, they were more to point out the fact that acceptable harm or risk is something of a universal concept in commerce. It’s not reasonable to ask beer companies to pay for every health complication of alcoholics just like it’s not reasonable to ask airlines to pay for every consequence of a delayed flight. This is because the level of risk was already agreed to by society: everyone knows that beer is bad for your health[1] just like everyone knows flights sometimes get delayed or canceled.

[1] The only reason the tobacco industry got into legal trouble is because they lied about their knowledge of its unhealthiness and addictive qualities.

In agreement with your points, but I think something even more pertinent to airlines compared to beer companies, is that a brewery is almost incentivized to create alcoholics. The only natural distinctives are at the extremes. Extreme alcoholics die and therefore stop buying booze, and social backlash to extreme levels of liquor consumption can cause profit-hampering regulations or outright prohibition. But in general, a person who empties a six pack every night after work is ideal for Coors.

Contrast this to airlines. They have ZERO incentives to delay your flight. They have zero incentive to divert passengers to another airport. They have no incentive to cancel, or otherwise prevent their plane from getting to its destination. Their interests are fully aligned with yours in this regard.

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