A casual observer might be forgiven for thinking that when Congress passed—and President Trump signed—the Economic Growth, Regulatory Relief and Consumer Protection Act, or S. 2155, in 2018, that financial institutions were being “deregulated.” That’s what hundreds of news headlines and ledes said. “What’s in the Bank Deregulation Bill” —Wall Street Journal “Senate Bill Part of Deregulation Wave” —Bloomberg “The House easily cleared the Senate … Continue reading What We Talk About When We Talk About ‘Deregulation’
It is a testament to the scale of Abraham Lincoln’s place in history that his notable accomplishments in the financial sector are little known today. Alexander Hamilton’s financial innovations are celebrated in a Broadway musical, and Franklin D. Roosevelt’s banking reforms are packaged with the rest of the New Deal policies as a legacy. But Lincoln—whose policies on banks were as transformative as either Hamilton’s … Continue reading Lincoln and the Banks
The regulatory front offers the possibility for meaningful regulatory relief, but the timetable for obtaining that relief is uncertain. Although ABA staff are working now with members to identify regulatory changes that will encourage economic growth, we may not see results immediately, says ABA SVP Virginia O’Neill, who leads the association’s Center for Regulatory Compliance.
This is because the top officials of the independent banking agencies have terms that do not expire with the inauguration of a new president. Continue reading “Compliance Issues to Watch in 2017”
Are airlines unfairly conniving to keep capacity low and thus drive up fares? According to Senator Richard Blumenthal, a Connecticut Democrat, they are—and he’s asked the Justice Department to investigate.
Unfortunately for airlines and their passengers, Blumenthal has succumbed to a particular Washington, D.C., affliction: thinking he can run a business better than the people actually running it. If they had their druthers, Elizabeth Warren would moonlight as a banker, Joe Barton as a college sports administrator, Jay Rockefeller as an oil company executive, and Hank Johnson as a geographer.
Based on a New York Times report on an airline industry meeting, Blumenthal is concerned that “many of these [airlines] publicly discussed their strategies to remain ‘disciplined’ in their decisions to manage capacity across their flight routes.” Continue reading “Senator Wants to Play Airline Executive”
This is why we can’t have nice things, New Yorkers might have muttered when they heard the news: Bill de Blasio, a shoo-in to be elected mayor next month, supports a plan to gut one of New York City’s most successful policy innovations of the past three decades.
That innovation is Central Park, the crown jewel of America’s urban parks. De Blasio made headlines when it was revealed that he supports a plan to redistribute money from Central Park’s operating budget to other, smaller parks throughout the city.
That may sound innocuous, but take a closer look. It would be one thing if de Blasio was proposing to move money around within the city’s $380 million parks and recreation budget. Instead, de Blasio has endorsed a plan to raid the assets of the private nonprofit group that runs Central Park. Continue reading “Would-Be NYC Mayor Would Gut Central Park”
Airline complaint one-upmanship is an old standby of small talk—“You had to wait six hours at the gate? That’s nothing! I was wedged between two linebackers and the in-flight movie was the latest from Larry the Cable Guy.” But is air travel really this bad? Travelers seem to think so. One measure finds that customer satisfaction with airlines is at its lowest point in three years; and the 2008 Airline Quality Rating, an aggregation of consumer complaints to the Department of Transportation, reports that complaints were up 60 percent since 2007.
Airlines seem to give travelers fewer reasons to smile. By mid-2008, many airlines had begun aggressive campaigns to bring in more cash through fees. Several airlines devalued their frequent flier miles, hiked the fees to book a “free” ticket, and started charging for checked baggage. New fees were added so fast that Southwest Airlines began running ads touting the fact that they merely had not added any fees.
And if the fees weren’t enough, fares are rising as airlines follow through on promised capacity cuts, trimming routes and frequencies. With fewer seats, passengers have fewer options and face higher fares to match record jet fuel prices.
But it’s not just the airlines. Continue reading “Why You Hate to Fly”
You might be forgiven for mistaking the pending privatization of Alitalia for the plot of a new romantic comedy–say, My Big Fat Italian Wedding. All the elements are there: the clumsy, unattractive bride to be, the parents desperate to marry her off to any suitor who can come up with a suitable dowry, the relatives anxious to make sure the dowry is large enough, the handful of frustrated suitors and the doddering grandfather who won’t let the bride marry a handsome foreigner.
Last week, Alitalia’s unions failed to come to terms with a bid for the airline by Air France–KLM. The $1.17 billion bid had been approved by Alitalia’s board and the Italian government. After weeks of negotiation and many concessions, Air France–KLM gave up and withdrew its bid. Stirring in trouble was former Italian prime minister Silvio Berlusconi, who decried the notion of “giving our national airline to the French.” Continue reading “My Big Fat Airline Merger”
Merger mania has struck the airlines once again. A year after US Airways failed to buy Delta Air Lines in a hostile takeover (then, pundits heralded the long-awaited industry consolidation), the buzz is back.
Not long ago, a hedge fund with stakes in both Delta and United Airlines spun a rumor about a merger, causing the stock price to soar. Now, Delta’s board has decided to examine mergers with other airlines, principally United and Northwest Airlines. Northwest’s CEO announced that merger proposals would be weighed carefully, and United has made no secret of its desire in recent months to merge with another airline. And now may be just the right time to merge, thanks to a provision in the 2007 appropriations act requiring “fair and equitable” handling of labor issues during a merger. Continue reading “Congress Fuels Airline Merger Madness”
On August 3, New York governor Eliot Spitzer signed a “bill of rights” for air travelers in New York state. The law provides that passengers who have boarded a plane but have been delayed from takeoff for three hours or more must have access to “amenities” like fresh air, power, lavatories, food, and water. The law also sets up an official “Airline Consumer Advocate” to handle complaints. Penalties for failing to provide these services can be steep: up to $1,000 per passenger.
This comes on the heels of a woeful summer, spring, and winter of airport delays and passengers trapped on immobile planes, most notoriously JetBlue’s February fiasco at John F. Kennedy International Airport, which saw passengers stuck in planes for up to eleven hours. Continue reading “Wrong of Way”
After the Republicans’ “thumpin’,” as President Bush described it, in the 2006 midterm elections, the recent host of books offering a scathing conservative critique of the Bush administration and the Republican-controlled 107th, 108th, and 109th Congresses look prescient.
It’s getting hard to keep the titles straight: In 2003 and 2004, left-wing critics offered Worse than Watergate, American Dynasty, The Price of Loyalty, Losing America, and The Politics of Truth. Beginning with Impostor: How George W. Bush Bankrupted America and Betrayed the Reagan Legacy, by former Reagan administration official Bruce Bartlett, conservatives and libertarians are catching up, venting their pent-up frustration with the Bush White House and the Republican leadership in Congress in book form. Continue reading “Friendly Fire”