Ted Cruz Wants to Take Back Your Airline Refunds

by Robert McGarvey

Money talks, you know what walks.  

On May 24 the Biden Administration announced final rules regarding refunds on flight delays and ancillary fees. You already know what it requires: refunds when a flight is delayed more than three hours domestically (six internationally).Refunds when baggage is significantly delayed. Refunds when paid for services aren’t delivered (WiFi, seat selection, inflight entertainment).

The reaction in the frequent flier community has been a yawn.  The refunds are ok as far as they go. But in the EU they go much farther in providing compensation to passengers; the US refunds are a pale carbon copy.  Yes, they are much better than the nothing we had (which was whatever the airline judged fair and we got it only when we jumped through all the hops an airline required) but the Biden package is a watered down disappointment.

In my view.

The trade group Airlines for America sees matters very differently. A statement said: “Unnecessary regulatory rules issued without collaboration will lead to three things: confusion for consumers, reduction in choice and a decline in competition, which historically drives up prices. Very simply put, a one-size-fits-all approach is anticompetitive and anticonsumer.”

Wait, requiring refunds for delayed flights is anticonsumer? This will drive up air fares?

There are moments, aren’t there, when today’s arguments seem like discarded scribbles from a rough draft of 1984. 

Yes, most consumers who understand what the DOT ruling requires wish there was more – but they also know that a slice of pie is better than the nothing airlines traditionally have handed out.

And then the stuff that walks got cranked up to an ear splitting volume by Ted Cruz and a few fellow travelers who want to erase the new DOT requirement that airlines make it easy for a consumer to ask for a refund (as opposed to the old, opaque processes that very probably nobody understood because it was never the intent that anyone actually use them).   

Cruz and his gaggle are cobbling together a bill to make this reversal happen.

The New Republic outlined what’s up here: “The bill would essentially make refunds only available to people who have the time and resources to navigate whatever processes an airline sets up. Plus, contacting an airline has never been easy to do. This would also seem to defeat the purpose of Biden’s new rule: hassle-free payback to inconvenienced travelers.”

What is interesting about the Cruz gaggle is that it is bipartisan, something that never happens in 2024 Washington DC. But, wait, remember our opening line. Jacobin tells what Cruz et. al. have in common. “All of them take substantial airline industry donations.”

Jacobin continued: “The lawmakers are four of the six largest congressional recipients of campaign cash from the airline industry in the current election cycle, according to data from the government transparency group OpenSecrets.”

Joining Cruz are Maria Cantwell and Rick Larsen (both Democrats from Washington where, um, isn’t Boeing headquartered there?) Sam Graves (R – Mo) is also in the group.

Much of the draft bill is plain vanilla, little to object to.

And then there’s a curveball: “Sets Clear Right to Refunds: For the first time, passengers will have clear standards in law for refunds when an airline cancels or significantly delays a flight.  A refund will be required if a domestic flight is delayed 3-hours and if an international flight is delayed 6-hours. Airlines will be required to display easy-to-find refund request buttons on their websites.”

That sounds good. It isn’t. What it does is undo the DOT rules and puts the burden for action back on the passenger, many of whom long ago gave up fighting with air carriers because it’s akin to trying to put an egg back into a cracked shell.

Usually, nobody except a low level aide would actually read such a routine document from Cruz et. al. That’s why it’s a perfect place to insert mayhem. 

But in this case clumsy Cruz stumbled and others took notice.  For instance: “Congress is using the latest FAA Reauthorization to weaken the DOT’s hugely popular new rule requiring automatic cash refunds for flight cancellations and delays—a watershed achievement issued just last week to protect passengers against too-big-to-care airlines,” said Morgan Harper, Director of Policy and Advocacy at the American Economic Liberties Project.

What can we do? Write your Senator and get this legislation stopped..

Sure, the Biden rules are disappointing…but they are better than the nothing burger Cruz et al are serving up.