You wouldn’t know it if you were a casual consumer of news, but the Biden/Harris administration has gotten a lot of stuff done despite not being able to pass crucial legislation like codifying Roe and reforming voting rights. #AbolishTheFilibuster. They’re not perfect, but things that the administration has accomplished over the past three years include vaccinating the majority of non-brainwashed Americans against Covid-19, lowering the price of insulin, allowing Medicare to negotiate some prescription drug prices, the CHIPS Act, the Infrastructure Law, and the Inflation Reduction Act. Secretary Pete has also been working on making our flying experience better, albeit to mixed results.
On Wednesday, the Biden administration proposed something they’ve been promising for a while now. The Federal Trade Commission has proposed a rule that would ban all things considered to be “hidden and bogus fees” that fall to consumers. In the same spirit of transparency that’s required for airlines, this rule would make it clearer for consumers when extra fees are being charged, the most glaring examples being hotels and live-ticket events. (F you, Ticketmaster!) It would also bar businesses from applying these BS fees to consumers and prohibit a business from advertising prices without mentioning the mandatory fees that inflate the actual cost. For example, U-Haul can’t advertise their price being “Only $19.99 in town!!” without mentioning, “Only $19.99 in town, plus a $100 fee just because!”
The Federal Trade Commission rolled out a proposed rule Wednesday that would ban what it calls hidden and bogus fees that can cost consumers an extra $80 billion every year, officials said.
“This is real money. It really adds up for people,” FTC Chair Lina Khan said in an interview that aired Wednesday on NBC’s “TODAY” show. The proposed rule would make it clearer when extra fees are being charged, like at hotels and at live-ticket events, the agency says. It would bar businesses from using hidden fees, or charges that the FTC calls “bogus fees” and which are misrepresentations, the commission said in a statement.
It would also prohibit businesses from advertising prices that leave out mandatory fees, a practice that causes consumers to expect to pay one price, only to see the actual cost soar, according to the FTC. It wouldn’t stop a company selling tickets to a concert from adding fees, and it wouldn’t limit what they can charge.
“What the rule says is that if there’s going to be a fee, a mandatory fee, it needs to be part of the total price that consumers see up front,” a senior administration official said in a briefing. Hidden fees are an issue that Robert Kraus, a frequent traveler who organizes conventions, knows all too well — things like getting charged $3 for a glass of water he didn’t ask for, and the price of which is not on the menu, and other extra fees, like resort fees.
“Sometimes they call it a convenience fee,” Kraus said. “Because it’s convenient for me and you to pay 20, 30, 40 dollars a night so that they can make more money and not be honest and upfront.”
President Joe Biden at his State of the Union address in February mentioned junk fees, which he described as “those hidden surcharges too many companies use to make you pay more.”
“They add up to hundreds of dollars a month. They make it harder for you to pay your bills or afford that family trip,” Biden said. His administration has proposed a bill that would ban surprise hotel resort fees, he said. It was introduced in the Senate in March. In June, Biden said ticket sales giants Ticketmaster and Live Nation have pledged to provide consumers with full pricing upfront. The proposed FTC rule will next be published in the Federal Register, and then people can comment for 60 days.
The FTC could force violators to provide refunds, and it could seek monetary penalties against companies. Other agencies are also taking action, officials said. The Consumer Financial Protection Bureau is issuing guidance to enforce rules to prevent banks from charging fees for basic services, like balance requests or other information, it said.
The bureau also plans later this month to propose a rule that it says would make it easier to shop around with banks and to switch accounts, for example to find a better interest rate, officials said.
Things really have gotten so expensive nowadays and it’s frustrating. For the smaller business, I completely understand that they are at the mercy of the bigger ones above them. You know, the bigger companies that they get their supplies from at a higher rate than ever before because it’s all about those profit margins for the executives and stockholders, baby. I like this rule, but I am skeptical that just like the airlines did, bigger businesses will still find a way around them. If they all agree to have these extra fees, then what does it matter to them if they disclose ’em? You’re still paying the same price, you just know what you’re paying for and don’t have another option to pay less. I guess it does help to realistically budget what you’re actually going to spend.
The other day, my friend Tweeted, “I wish people would stop confusing inflation with capitalism,” and I can’t stop thinking about that. I’ve been trying to put those thoughts into words for a little while now, and she expressed it so eloquently and succinctly. I really hope this ends up being a solution that actually helps make things more affordable and discourages companies from charging these junk fees.
air bnb fees have gotten ridiculous. you can find a place for $100 a night and 2 nights somehow comes out to be $500… not doing it, I’ll just get a hotel.
— india. (@IndiaDionna) February 19, 2021
Absolutely nuts that @Ticketmaster get's away with these kind of fees pic.twitter.com/sr4KKwYFkX
— Bret Little 🇺🇦 (@little_bret) October 12, 2023
Junk fees can add up to hundreds of dollars for working families.
President Biden continues to call on Congress to pass the Junk Fee Prevention Act to stop unfair charges by hotels, airlines, cable and internet companies, and online ticket sellers.
— The White House (@WhiteHouse) October 9, 2023
The entire Biden administration is working to eliminate junk fees across the board & protect families from unfair charges.
Visit https://t.co/1QkmVqmAaB to see how USDOT is strengthening passengers’ rights and improving airlines’ customers service. https://t.co/WD1uPmgMog
— Secretary Pete Buttigieg (@SecretaryPete) October 11, 2023
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