President Biden’s New Airline Delay Compensation Legislation Is Cynical Election Fodder

While the world’s airlines are demanding fewer consumer protections, the Biden administration has proposed that airlines pay cash compensations to passengers when they delay or cancel flights.

I wrote that the plan to regulate airlines by the Department of Transportation was largely political posturing and the decision by the administration to send legislation to Congress right now to require this compensation underscores this.

The Biden administration has submitted draft legislation to Congress that would mandate airlines pay cash compensation for delays of three hours or more when carriers are responsible.

The proposal sent earlier this week and seen by Reuters would require “cash compensation in an amount commensurate with the inconvenience experienced” when a delay or cancellation is due in part or in whole to an issue under the carrier’s control.

The Biden administration said they were going to mandate it on their own, via regulation, but they never released a Notice of Proposed Rulemaking. That, they said, would come before the end of 2023 – suggesting that:

  • Any new rule, which requires a notice and comment period and then consideration of comments in drafting final language, likely would not happen prior to the 2024 Presidential election

  • So whether or not any rule happened likely depended on the outcome of the 2024 election

This suggested that it was a political issue to run on (middle class pocketbook) rather than a policy issue. Submitting legislation to Congress to do this suggests the same thing.

  • Biden administration proposed legislation, less than 18 months before the election, is dead on arrival in the House of Representatives.

  • The President can say he’s pushing for legislation, without worrying that this legislation actually passes, and therefore it becomes a point on which he can distinguish his plan from the opposition party.

United Airlines CEO Scott Kirby says this compensation creates a bad incentives for airlines to be cautious and take delays or cancel flights for safety – so compensation compromises safety. This hasn’t happened in the EU, though of course EU261 compensation is often ignored by airlines, so I’m not sure the EU experience rebuts this concern. EU compensation also hasn’t reduced delays.

Regardless, the starting gun on taking care of customers in the event of controllable delays and cancellations – compensating customers for failing to deliver the product that airlines have sold – has mass appeal, and signals a concern by the current administration for middle class concerns in a way that they think can differentiate themselves from their opponents. Precisely because this legislation won’t be acted upon, the President can paint Republicans as unwilling to protect voters from unpopular businesses.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. When EC261/2004 was being considered, it was said that it was political issue to run up public support for the European Union. Whether it worked for that purpose or not, it works for me as a consumer and I welcome a US equivalent — with inflation-adjusted amounts.

  2. @GUWUNDER-I agree! Plus, such a move would put an end to Frontier’s shenanigans in a heartbeat. It can actually benefit the more consumer-friendly, better run airlines

  3. I’m with GUWonder. I also think that there’s an extremely simple way to make it so that the airlines will quickly and efficiently pay out legally required compensation to passengers: penalties. It’s simply a matter of making it so that there’s sufficient disincentive to not pay up immediately that the airlines will pay out immediately because that’s what’s best for them. As a simple analogy, why do people pay for their speeding tickets? Because if they don’t they will lose their license and/or be arrested., plus having to pay the original ticket plus court costs plus penalties. I suggest EC261 compensation levels adjusted for inflation annually. If the airline pays but not immediately the amount goes up: double for up to 7 days late, triple for 8 – 29, quadruple for 30 – 120 days, etc. with all amounts being doubled if the airline fights the payment but the passenger wins. The deck is horribly stacked against the passenger; we need some very strong legislation to help rebalance things.

  4. Weird to make this political. I guess we have to be cynical about everything a president does after their first year in office!

  5. if a law is required, the result will be DOA.
    Any even semi-objective analysis will show that US airlines are operating more reliably than EU airlines and are compensating their passengers for delays faster than EU airlines.

  6. I don’t have a problem with the right thing being done for the wrong reason. Never have, no matter what the issue. I don’t need hearts to be pure.

  7. Will never happen. Same with the others who treat their customers with contempt – cable, phones, banks, you name it… it’s cheaper for them to buy off politicians than provide anything resembling service to their clients

  8. They do it because a large portion of the electorate is ignorant enough to buy into it. The costs will get passed down to the consumer.

  9. You can’t be serious with this obvious, poorly presented propaganda. Perhaps you should consider simply posting information and leave your two cents out. Do better.

  10. @James – nope, some comments go into a moderation queue automatically as potential spam, and I have to clear those manually, which isn’t happening quickly during the middle of the night in the time zone I’m presently in

Comments are closed.