Here it is:
“Government’s Cut,” huh? So tacky. Who do you think pays for all those airport runways, air traffic controllers, environmental cleanup, etc.? Assholes.
Next time I’d prefer my plain ticket to come without any stupid propaganda attached to it.
Typo alert: that should be
“Next time I’d prefer a plain ticket without any stupid propaganda attached to it.”
David:
“Plain ticket” was intended; Spirit is a budget airline and offers a plain ticket with no frills, which is fine with me.
How about “plane” instead of “plain” ticket
please explane
I’m not sure whether the Gov’t cut is earmarked for those categories, so I’m not sure how annoying that language is. But, I’ll offer this from Sun Country Airlines:
“Bags are more expensive if purchased at the airport.If purchased at the gate (I believe it is $5 additional)
a $10 Gate Handling Fee will apply in addition to standard “At airport” bag fees.”
Or this from Dollar rental car:
“FREQUENT FLYER SURCHARGE
When the renter chooses to receive Frequent Flyer miles, we will collect a Frequent Flyer surcharge, not to exceed $1.50 per day, at the time of rental to offset a portion of the annual cost of participation in the Frequent Flyer program.”
“airport runways, air traffic controllers” are run by the private sector in most parts of the world…I don’t know how much the fees from the government handle environmental cleanup, but you can add security to the list (which again is often handled by the private sector).
I don’t think that’s entirely true, though. From the paper “Privatizing Infrastructure: Evidence from Airports”, we get a figure of 20% of global airports being owned by private corporations (in 2020). From Reason Foundation’s “Annual Privatization Report: Aviation”, the list of privatized ATCs stands at 4, while several dozen are controlled by the public sector.
Either way, for both categories, in “most parts of the world” the functions are handled by government (or a government-controlled entity).
|“Government’s Cut,” huh? So tacky.
The government cut is for the necessary jet fuel supplement to ensure that your flight can make it to the crash site.
I’d say at the ~50% rate shown on your reciept, it’s a great idea to show what fees are for. But strictly speaking it’s not accurate. Local airport improvement fees – probably about half of what they show as “the government’s cut” on your reciept, don’t usually go to “the government”, but to a local port authority.
This site gives a fee breakdown. It’s a little old (2019):
https://taxfoundation.org/blog/understanding-the-price-of-your-plane-ticket/
The Federal fees/taxes are:
7.5% tax on price: $6.42 for Andrew
$4.20 fee for each leg presumably: $8.40
$5.60 “September 11th Tax”: $11.20
the site shows the “Passenger Facility Charge (PFC)”, which is for local airport improvements, at that time was capped at $4.50, (for each boarding or deboarding) but it perhaps has since risen.
In the US, big airports, at least, tend to be run by the government (e.g., Kennedy, O’Hare, Hartsfield); security (TSA plus local police that patrol airports) and air traffic control are run by the government at all airports. The level of government will vary, and my be local (e.g. O’Hare), state, regional (e.g. Port Authority of New York and New Jersey), or federal (e.g. TSA).
Depends. In Seattle, which Im most familiar with, the Port of Seattle, which includes Seattle-Tacoma International Airport and the maritime harbor in Seattle, is run by publically elected commissioners and is independent of all regional governments. OTOH, following up for this comment, I see that the Port of Long Beach is operated by the city of Long Beach and the commissioners are appointed by the Mayor, so there is a mix ports which are operated by “the government” and ports which are independent of the government.
Port of Seattle is a government agency. The state legislature authorized the creation of municipal port authorities, and the Port of Seattle was created by King County, and its citizens, as you note, elect the commissioners.
Checking the two airfields nearest to where I live, Kenosha (Wisconsin) Airport is municipally owned, while Batten Airport is privately owned. But both are very small. So, there is private ownership of airfields, but I don’t know if any of the big ones are privately owned.
“Port of Seattle is a government agency. ”
I disagree. Wikipedia uses that term but IMO that use is erroneous. At best it is a government in and of itself – independent of all city, county and state officials – not an agency of some other goverment. We don’t say, for example, that NYC city government is an “agency”. It is an indpendent government. The same is true of the Port of Seattle. It is more appropriate to call the Port of Seattle a “Government entity” than a “government agency”. But really it’s more analogous to a publically owned corporation. See here:
https://www.portseattle.org/blog/who-pays-sea-airport
It has limited authority to raise funds through property taxes – and again this authority is limited by law but not subject to the approval of any state, county or local governments or government officials. But as of 2023 general property tax generated only 4.1% of its budget.
Here’s an interesting quote from from the above link:
“Although nearly all U.S. airports are owned by state or local governments, airports are required by the federal government to be as self-sustaining as possible and receive little or no taxpayer support… The bottom line for local taxpayers is “if you don’t use the airport, you’re not paying for the airport.”
So at least according to the Port of Seattle, all of what Spirit calls “the government’s cut” is either airport user fees that are returned directly to that airport, or general fees to the Federal government that are returned to the national aviation system, sometimes as grants to individual airports and sometimes to the system as a whole.
I still argue that calling it “the government’s cut” is misleading, especially with reference to local airport fees. Although I haven’t bothered to see how much of the Federal tax is reinvested in aviation; maybe that goes into the general fund.
Let’s not forget the middle east wars that kept the cheap oil flowing for the aircraft’s fuel supply. And the ongoing cost of paying for veterans of said wars, though much of that burden falls on the veterans themselves. Plus the cost of making bankers wealthy through interest payments on totally frivolous debt instruments we use because “that’s the way we’ve always done it”. Plus the cost of bailing out the banks when inevitably “that’s the way we’ve always done it” fails to actually work because it’s not designed around the modern reality of how money works.
Wouldn’t hurt to throw in a few hundred billion in fraudulent COVID “loans”. Also we could expand policing now that they’re killing more citizens per year than ever before. Also lets funnel a lot of money towards pharma companies that are manufacturing life saving pharma products that they have patents on even though the product was developed almost entirely via public funding, and they’re manufacturing using factories the govt literally pre-paid them for and didn’t require any investment by the pharma co.
Maybe throw a crap ton of public money at google for effectively building out the NSA’s surveillance system.
Possibly throw a crap ton of money at Israel so they can kill 20,000 children and destroy all the civilian dwellings in Gaza systematically while posting smiling videos to Instagram
https://www.bellingcat.com/news/2024/04/29/weve-become-addicted-to-explosions-the-idf-unit-responsible-for-demolishing-homes-across-gaza/
Also someone has to fund the snipers who point precision 300 winchester magnum rifles at 19 year old kids on college campuses.
https://customersupport.spirit.com/en-us/category/article/KA-01173
Perhaps a better term would be “Government-imposed minimum price”. Still doesn’t seem correct though.
I have a similar experience in restaurants that make a point of imposing a surcharge and calling it out on the menu as a thing they are being forced to do to cover some boondoggle like medical insurance for the staff. Bon appétit!
A couple of weeks ago we were taxiing out toward the runway when the plane suddenly and scarily lurched to a complete stop. After a few silent minutes we were told that the plane, a Boeing 737-something, had a steering problem. The runway, on the other hand, was fine.
Are you complaining this is propaganda due to the label “government’s cut”? I would like full disclosure of all fees from all parties (govt fees and taxes and the airline companies fees). More info seems better. There are a lot of taxes and fees out there, and they don’t always seem obvious. I don’t see why informing people of them is ‘propaganda’ unless your the kind of person who doesn’t want people to know.
Jd:
Informing people about taxes is fine with me. My problem is with calling it “government’s cut,” which seems to me like a propagandistic way of putting it.
I think a lot of people are understandably upset about govt policy. Some people are upset about paying any taxes at all (the right and billionaires and private equity etc), but the bigger group of people are people who actually want to pay taxes to an effective govt that does stuff people want done. Instead we seem to be in an endless hell of elites doing what they like and **ck the rest of us.
From a federal govt perspective you can break the budget down into several major categories:
https://fiscaldata.treasury.gov/americas-finance-guide/federal-spending/
1) Transfers (Social security and medicare = 35%)
2) “Banker’s cut” (13% net interest)
3) “Health” which is mostly stuff sent to states for medicaid, and federal medicaid and medicare and HHS services but also about 4% of this is NIH research etc
4) Defense (some of which is research but most of which is war stuff)
5) Income security (which is largely transfers but in a bureaucratically bullshit way that is very controlling about 8%)
6) Vet benefits, which should mostly just go under deferred defense expenses
7) all the stuff people actually think of the govt doing, like Transportation, infrastructure, education, childcare etc which makes up together like 10% ish
So for the most part the stuff people want the govt to do most, like roads, bridges, airports, universities, dams, national parks, land management, environmental regulations, agriculture inspections, food quality, etc etc… makes up like 10-20% of what the govt spends its money on, an amount that is on par with pure transfers to bankers.
Yes, most people want some kind of “social security” in some general sense, but it would be vastly vastly better to do a UBI and create money through direct grants equally to all people rather than the ridiculous bonds and banking system we have today.
A 40% flat tax on income, and a 10% of GDP/capita UBI together with a change in how money comes about (through individual accounts at The Fed) could allow us to eliminate essentially all of Social security, bond interest payments, and “income security” while actually providing vastly better “social security” and shrink the bureaucratic size of the federal govt in maybe half. And that’s without even cutting defense and through time reducing the number of veterans needing benefits or adjusting the Health component. Add in a centralized govt clearinghouse for medical billing and an automatic stop-loss insurance after some level of payment each year and some level of long-term payment… and the whole system could be vastly smaller and superior in every way.
Every way that is except that it would remove power from elites to set rules on how poor people live, threaten everyday people with bankruptcy if they decide not to work for enormous corporations who control their access to healthcare, and keep funding bankers for doing essentially nothing. Oh and keeping up the elite medical grift that’s keeping Optum and others wallowing in money. Also to constantly threaten poor people with IRS audits and keep small businesses out of the market to keep large businesses who are collaborating through price-fixing schemes relatively competition free.
Daniel:
I kinda get what you’re saying, but airline fees seem like a pretty clear example of a user fee that directly benefits the industry involved. From my perspective, they’re complaining about the “government’s cut” while sucking up government subsidies, which seems like the worst of all possible worlds, rhetorically speaking.
Yeah, I do get that. I actually agree with you regarding airline fees. I’d call these particular people in-line with the sort of right wing entitled elites I mention in the first sentence. I mean, they own an airline after all!
I was mostly responding to the more general case of complaining about taxes, and I should have made that clear in my post. In the more general case, there’s much to be upset about. Little of what the govt is doing with money these days corresponds to what people tend to think of as the legitimate role of govt. And people give a pass to systems like social security, medicare, and income security because “aid to the poor” except in fact they tend to overall on average be a transfer from the poor (young) to the rich (old). And the assumptions they were built on are not good ones and will never be good again in the future of the demographics of the human race (that fertility was high and longevity was low).
UBI has a guaranteed good assumption (ie. taxing uniformly by a fixed percentage of earned income and paying out uniformly a fixed dollar amount per person will always transfer from the wealthy to the poorer on average and is equivalent to an **even more progressive** tax than the most progressive taxes the left usually promote)
Twenty years ago an undersecretary to the Treasury nicely pointed out that most government spending goes to Social Security, Medicare, and the military, by saying “The US is an insurance company with an army”. I’ve always liked that quote.
So, what’s a suggested term here that is accurate yet still plain language? I get what you’re saying, but trying to take the most charitable view possible, they seem to be going for a sort of easy to understand summary that breaks the price down into two pieces… the part they can control and the part that is externally mandated and that all airlines have to charge. Is there language that would be acceptably precise while not getting too technical for a summary view? Then I expect it would be helpful for the curious to have a hyperlink to a more detailed breakdown.
As a consumer, I can actually see the value in a top-level view of the costs as they have done. It’s actually useful to me. So… is there a different way to name it that is a little more neutral while still being easy to understand?
Scott:
I’d be just fine with calling it “Taxes” or “User Fees.”
Going down a different rabbit hole, I read the link above to the Spirit airlines website, where they complain about regulation from 2012. I found an article about that.
https://www.transportation.gov/briefing-room/dot-provides-guidance-advertising-free-airfares
The reason the department of transportation calls out for the change is to protect consumers from being advertised a “free flight” and then finding out it’s not really free, you still have to pay all of the taxes and fees.
And I think to a lesser extent, the same thing applies to discounted fares. The theory on the discount airline side is that if you can discount to the point that it sounds really cheap, the response on your advertising will be better. But adding the extra fees into the cost makes it sound less attractive in the advertising, reducing demand.
There seems to be proposed (or implemented?) legislation in 2014 to combat the 2012 rule. https://transportation.house.gov/uploadedfiles/taa.pdf. This allows airlines to break out the base price from the additional fees and taxes.
The legislation document makes the following arguments (and it seems reasonable it was lobbied for by airlines that liked to use discounts as part of their promotion strategy, so I’m sort of using this as a proxy for Spirit’s opinion… it definitely uses a lot of the same language as their website like “government is forcing costs to be hidden”). 1) other industries don’t have to include all the fees in the price 2) if the advertised prices are higher it reduces the demand for air travel.
I kind of see this… if close substitutes (say trains or buses?) were/are allowed to not include similar taxes and fees it could affect demand. And I guess even more distant substitutes that definitely don’t have to include taxes when advertising theoretically have a smaller impact on demand (e.g. I can buy myself a new wardrobe or take that weekend trip to treat myself).
And so maybe that is something that you can call out as playing favoritism for particular industries. And you should be decide if you’re OK with the societal impact of the share you are diverting from air travel elsewhere. If that’s unintended and undesirable maybe there needs to be more equitable rules.
On the other hand, it’s a little hard to feel sympathetic to an argument that advertising has much better response if you were just allowed to hide a big share of the consumer cost and spring it on the consumer at the last second.
After exploring this rabbit hole, I think I am back to the same place. I am actually OK with them being able to break out those costs separate from the base price but I am also fine that they have to disclose them in the advertising. So I guess I’m OK with the balance currently achieved.
I am interested if there is a more neutral moniker for the costs than “government cut”.
And it is interesting that some categories can advertise without including taxes and fees (clothing? food?), while others can’t (gas?). I bet there is someone who has thought about the implications of those policies, but I haven’t.
And I wonder what the impact of demand on different categories would be if we were to incorporate more of the infrastructure costs when those are funded directly at purchase point but some other way? Or what if we included in other societal costs currently treated as externalities? How much would it really dampen demand and change the preferences?
Anyway, enough of this rabbit hole…
Tangentially related to this, but… One of the things that blew my mind when I first visited the US and Canada was that the price tagged on something in a shop could be different from the price I actually had to pay to purchase it, because it excluded taxes. Such a silly, consumer-unfriendly approach! In the abstract I might occasionally care about how much of a purchase price is taxes, but in the moment all I want to know is what it’s going to cost me.
Correction:
when those are not funded directly at purchase point but funded in some other way?
I left out a “not”