In the early 1900s when the Wright brothers created the first workable airplane, they had no idea what revelation they introduced to the world.  Orville and Wilbur, just two ordinary brothers, eventually would change the world. As airplanes became the new phenomenon, people became more interested in what they were and how they worked.  The early 20th century marked the first time aircrafts carried passengers. In 1938, the Civil Aeronautics Act established the Civil Aeronautics Board which created travel routes and prices for airline tickets (Harris). The Civil Aeronautics Board created the start of something that would cause major issues in the future of the airline business. The past decade of flying has experienced a hike in prices of tickets. Many consumers, who are average people in the world, have noticed this drastic change emptying their wallets.  As consumers look for answers, the airline companies continue their corrupt work taking advantage of consumers. Anyone who views this argument cannot logically say that the airlines are doing consumers justice; as the airline companies revenues climb higher, so do the ticket prices. If the airlines are able to supply to the market, then the demand will increase. However, the airlines have thought differently. This attitude advertised by the airline industry has caused me to research into this issue and uncover that the rise in ticket prices is largely based on governmental influence, inflation, total revenue, and the creation of an oligopolistic market. 

Over the past decade, at least, the airline industry has become an "oligopoly" (Reich 6) that has transformed the game; big name carriers with high fares are dominating the field. But how has this happened? Airlines have matured over the years, becoming more "cynical and less likely to accept change" (Reich 6), meaning that the major airlines that are dominating the market are living with the large revenue they are making, not willing to change, leaving competition basically non-existent. Legacy Airlines, such as American Airlines, United Airlines, or Delta, are mature airlines that are not interested in lowering their already high costs. These carriers want to "quantify growth in terms of total revenue" (Reich 7). Legacy carriers are smart in that they rely on supply and demand; when supply is restricted, then airfares will increase. Because passenger capacity would be at a high, airlines would in turn offer "deals" that would make competitors have to compete and lower their fares so that their flier capacity would be high also. Between the top airlines, this system is no match for "low cost carriers". Low cost carriers cannot use the same method that the Legacy carriers use, so they do the opposite of supply and demand. Low cost carriers increase the supply and decrease their fares so that their capacity can be high. This system seems more beneficial for consumers, with "lower costs", but then the question of quality of performance comes into question. Consumers are put in a bind of either choosing the high fare with better quality or the low fare with bad quality? This system of differing business is exactly what is causing the oligopoly; Legacy carriers are decreasing because of lessened competition while low cost carriers are struggling to "fill the void left behind". As these two types of carriers battle it out in the industry, the government silently backs the Legacy carriers allowing heavy taxes to be placed on their air fares. Although the government tries to stay quiet, their hand in the airline industry comes with many aspects that will affect the prices airlines implement (Reich).

Not to be empathetic with the airline companies, but with the rage of consumers pushing down their doors, the airline companies also have the burden of the government "weighing down" (Bethune) on them. Although the government does not have full control over airlines, they have a heavy hand over them. The Government, in particular Congress and their strict legislation, implement taxes and fees that the airline companies have no choice in charging to consumers. Millions of dollars invested in these fares have gone straight to the companies and the government; Bethune states that in 2005, even "few passengers realized that more than 20% of the average $200 ticket is taxes and fees". Large investments like "infrastructure and security" made by the government are also direct causes to higher ticket prices. Because of the devastating events of September 11, the airline industry would change forever.  Security protocol for airports and airplanes would have to come into discussion and new changes would have to be made. Tightened security would soon become the norm. So, if all these new changes were being added, how would they be paid for? The bill would come to the consumer. McCartney explains in his article that the Transportation Security Administration was going to take the funds and put them toward airplane tickets; this would ultimately double ticket prices (McCartney 2014). This cause is one of the more direct reasons as to why ticket prices are rising. However, the government is the one responsible for this increase; September 11th was a matter that was afterwards "taken care" of by the government, so they should be the ones "paying" for the benefit of its citizens. Yes, enforcing tighter security is a measure that needs to be taken, but why do consumers have to take the repercussions of an event they had no control over?  Yet again, consumers are being punished for things out of their control. Fliers are already anxious because of past events; does the government really want to add anger to their emotions? While the airlines are already seen as the antagonist, the government's role as their "partner in crime" only makes the view of the two together even worse.

The general decrease or increase of goods based off of the market, known as inflation, what many economist attribute to the issue of airline tickets rising. Critics try to undermine the issue by saying that the increase is inevitable with inflation. However, in the article published on BusinessInsider, the writer proves that increase in ticket prices had actually in fact surpassed inflation by about 0.5% (Here's why Airfares). Yes, prices before had moved along with inflation, especially during recessions when prices rose almost 12%. However, data shows that the proportion of prices with inflation is uneven. Airline companies continue to raise large amounts of revenue. Usually when a company is making so much money, their willingness to lower prices is more likely. With the effects of inflation, the prices of products are bound to rise. Within a year, the increase of inflation may be so small that one may not notice, but over time the total increase can be surprising. If you ask someone today, "was it cheaper to fly 30 years ago?" they would most likely say "yes". But, how much cheaper was it? Not only because inflation but also because of the amount of taxes placed on airline tickets, have the prices raised steadily. Brancatelli brings this point into question with the chart he puts together; a side by side view that can show anyone that over the past 30 years, inappropriate fees have toppled on top of the initial airline ticket. Between the two time prices and every fee available that could be added, there is about a $300 difference. Thirty years ago, consumers were paying simply for the flight. However, today consumer's fare does not reflect the "true cost of flying"; consumers are paying for an "experience", and one that is not of top quality. Although inflation is an aspect of this issue that plays a part, it cannot be fully blamed for. As shown in the CBS video, the airlines continually look for another culprit to blame (Are Airline Ticket).  Inflation has become a curtain used to hide the true nature airline companies and the government placing their own fees on tickets. Statements made by the airlines such as "don't get mad at us" (Are Airline Ticket) are inflammatory remarks that easily put the blame on them.

To be able to pull off such a plan so intricate and to still be able to make such a large profit, the airline companies are no dummy. Even before prices were becoming unjust, the industry was well above a comfort level, meaning they were and are still making billions of money each year. As the number of airlines decrease creating an oligopoly, which will be further discussed later in this paper, the few that are left in the industry are capitalizing off of the enormous amounts of money they're making. The main argument stemming from total revenue is when does profit overshadow benefiting the consumer? Apparently, the answer to that question was confirmed years ago.  As oil prices fell, consumers expected the same for airline companies (Sorkin). Consumers trust in the airlines caused them to believe that as the economy would prosper after sporadic recessions that the airlines would work in that way too. But with price drops on other market goods, the airline companies took advantage and began their reign of taxation. With any means, even "discrimination", the airlines companies would do anything to accumulate profit (Bischoff).  To breakdown the taxation applied to tickets, this is how it works: compared to the average taxes placed on alcohol and/or firearms, travelers pay more for tickets. Up to 20% of the price of an airline ticket is based off of taxes that are collected by the airline and the government. The long list of taxes that has been positioned includes anything from bag fees to fees based off of extra room wanted by the consumer.  In order for travelers to receive somewhat of an enjoyable flight, they are burdened to pay more for it.  Mergers, allowing multiple airlines to combine, is also skyrocketing their profits by billions causing their power to increase and their ability to raise fares even more likely. These airlines however, see no problem with consumers paying more since they blame the consumers. Travelers apparently complain so much about the quality of their flights that the airlines in turn believe that then consumers should hand over more money to the airline which will then prompt a better experience (Your Airline Ticket). Notice the corruption yet?

When the federal government allows for mergers, as mentioned previously, this allows for big name carriers such as Delta or American Airlines to combine together to ultimately increase their profits. With the industry already limited in the amount of carriers available, this leads to diminished competition.  For example, the U.S. Justice Department allowed for U.S. Airways and American Airlines to join together where they will "control 69% of air traffic" (Nicks). This type of market known as an oligopoly, lets the more profitable carriers prosper while the ones that cannot keep up with profits either fall behind or get bought by a big name carrier. To be the top of the industry, airlines would do things such as, "adding capacity to popular routes to undercut a competitor" (Sorkin) or temporarily lower their prices so that consumers will be attracted and chose their tickets over another airline. Once the main competitors are established, they secretly work together to make short cuts that they know will cause consumers distress. For example, airlines will decrease their flying capacity or remove some popular routes so that consumers will have to pay the more expensive price so that they can still get the flight they need. Airlines demand for higher prices to be paid but the quality of flights that they are giving does not equal each other.  Many flights are not only removed or cancelled but delayed by large amounts of time. Secret tactics like this are ways the airlines undercut consumers; a consumer may pay more thinking that they will receive a shorter flight, but airlines will extend their routes so that the plane ride last longer . There is no deal acquired by consumers who are put in this situation (Rupp).

During this whole debate over the airlines and the government and the economy and so on can seem so lengthy and in depth, but when bringing up this issue, the main stakeholder who takes all the repercussions is the consumer. When talking about economic and governmental aspects, the consumer: the people can get lost in translation. Travelers rage from all different types of people, middle class families to students to world explorers to business women and men. No matter who flies, the change in ticket prices will affect all.  With airline ticket prices rising, consumers await for the airline companies to take responsibilities. But, for years, the companies were dismissive of the cost change, causing continuing annoyance with customers. Research blatantly shows that with all the new taxes and fees airlines create, they are the pure reason for rising ticket prices. Because the airlines offer no help, consumers have had to turn the role of finding good prices on themselves. In past years, websites have been created that advertise "low prices" that consumers can afford. But, what these sites do not advertise is that most of the low prices they offer for flights are for certain days and times when that flight is apparently the cheapest (Harlan). This poses a problem for consumers, because like most people they have their own schedule, not one that is centered on when the airlines are feeling "giving". These cites basically tell consumers, "yeah we can give you this flight for a cheaper price but you have to do everything we say as we say". So no more consume rights. Other critics explain that consumers shouldn't go for these big name carriers anymore, that the real deal is settled with "low cost carriers". Low cost carriers make much less money than the legacy carriers like Delta, and somehow they are able to still provide low prices? Rosato backs this up saying that low cost carriers are making an "average just 7.3 cents a mile compared with the 11.7 cents for traditional airlines". However, this argument fails because with low cost carriers, the question of quality comes into play, with a larger number of critics explaining that although these carriers provide lower costs; their service of quality is also low. This does not put the consumer in any better of a situation. 

I believe that most people can and will agree with me on my views of this issue. Most people see how the airlines have taken advantage of consumers and how the companies are not willing to change. However, in an article written by Kristin Davis, called Fare Deals, Davis' views reflect the somewhat opposing view. Fare Deals is an interesting article in that Kristin Davis acknowledges that airline prices are rising, but it is up to the consumer to find a solution. In her article she proposes options that consumers can take to find lower fares. Davis states the large increase in prices saying, "ticket prices climbed 11.6% [. . .] but that doesn't include the fuel surcharges airlines began tacking on" undermining herself completely. So, instead of offering ways the airlines can lower their cost, Davis tells consumers that they should use her options of finding low flight prices. Even though her choices are ones that yes, some may use, many people may not be able to follow; her choices are easier said than done. But, she goes on to contradict herself by claiming that "one drawback: some internet travel sites may lead you to great deals that really aren't available", which weakens her ethos.  Her approach is thoughtful but Davis did not think carefully about all the aspects and stakeholders involved. Traveling on certain days and times is just another one of her approaches that does not take the consumers into consideration. This view reflects many of the articles who oppose the anger toward this issue. Critics try to put the blame on the consumer instead of the airline companies. In regards to this major issue in the world today, I hope that those who read my argument are able to see how corrupt the airline industry has become and how much manipulation they impose on their consumers

